The Swedish Transport Administration

Johan Hansen

Coordinating Risk Manager

johan.hansen@trafikverket.se

2 2010-05-19

2

• Sweden is a country in the north of Europe

• Population of 9 million• Land area 450,000 square metre• The climate consists of four seasons.

Every season has its special condition for managing roads.

• The Swedish Transport Administration has approximately 6,500 employees

• Responsible for the long-term planning of the transport system for road, rail, maritime and air traffic.

• Responsible for the construction, operation and maintenance of public roads and railways.

• Manage approx. 100,000 km road network

3 2010-05-19

4 2010-05-19

Integrated Risk Management

The line organization,Support functions

Risk Ownership

Own risk andrisk management activities

Internal control;safety, emergency and security,

Information, etc.

Risk Management functions

Establishes and instructionsframework for risk assessment

and follow-up

Internal audit;quality audit,Audit activities

Audit functions

Testing and validation ofeffectiveness of risk management

and control

Common concepts and definitions

Common methods and tools

Joint monitoring and reporting structure

Common support schemes

First line responsibility Second line of responsibility Third line of responsibility

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Bad things can happen.

attitude: Conservation

Static viewNaturediseaseswaraccidentslandslidefloods

Maybe good thingsnot happening.

attitude: Development

Dynamic visionIdeamarketDevelopmentpolicyImplementationperformance managementperformance

Humans

RISKInsecurity effect on goal

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Risk Management Process

Global risk assess

Define the context

Analyse Risks

Evaluate risk

Treat Risks

Identify Risks Monitor and review

C

omm

unic

ate

and

cons

ult

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Risk management process integrated into the organization

Risk Monitoring and Communications

Risk Monitoring and Communications

Risk assessment

Risk identification Riskanalysis Risk Evaluation Risk

treatment

Documentation / Risk Register

Risk Monitoring and Communications

Mission Reporting

Inputvalues

Risk Profiler / Basis for risk reports

Project, management and ongoing operations

Society Traffic Major projects Profit centers

Top Management

Mission Reporting

Investment Key functions

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Risk Management Sub Areas

Guidelines for Risk Management

Risk Management in:• Balanced Scorecard• Project • Network Management• Internal Safety (IT-security, Working

Environmental, Offices)

Normal Condition / Serious Condition / Crisis

•Crisis Management

RM - Top Management

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Consolidated risk matrix and profile

Very high 4Investigation Action Action Action

High 3Investigation Investigation Action Action

Medium 2Acceptance Investigation Investigation Action

Low 1Acceptance Acceptance Acceptance Investigation

1 2 3 4Negative media coverage and attention

Single column Local Regional National

Management time and effort/ negative attention

Unit Unit management

Executive top management

Board/ investors /ministry

Property Damage

Infrastructure/Equipment/ Buildings etc.

≤ 1 million US Dollar

≤ 50 million US Dollar

≤ 200 million US Dollar

> 200 million US Dollar

Road users

Employees

Operations Dow ntime

Short dow n-time Single unit dow n for short period

Single unit dow n more than 50% for more than 1 day

Single governing unit dow n more than 50% for more than 1 day

Environ- ment

Impairment Single occur-rence/gradual

Temporary minor

Temporary serious

Permanent minor

Permanent serious

Minor Moderate Major Critical

Main road shut dow n for several hrs or secondary road for > 24 hrs or one area for > 12 hrs

Main road shut dow n for > 24 hrs or one area for > 48 hrs

Minor injuries Multiple injuries Single death or multiple serious

injuries

Multiple deaths and serious

injuries

Aspect

Risk response

Increased accident rate

Reduced transport capacity

Impact

Transport capacity

Secondary road shut dow n for a few hours or one area shut dow n

Main road shut dow n or secondary road shut dow n for > 12 hrs or one area for a few hrs

Like

lihoo

d/fre

quen

cy

Event occurs several times per year w ithin the realm of the organisationEvent has occurred w ithin the realm of the organisation

Event has occurred in the country

Event never occurred in the country

Intangibles Confidence /reputation

Type

of a

sset

Personal

Finance

• Each level in the organization, or project, must decide thereown evaluation support. Project should add Time as qonsequence class.

• Preferably from a organizational top evaluationsupport.

• The top evaluation support are used as an aid to decide if risks and serious incidents that occur should be escalated to higher organizational level

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RM, Balanced Scorecard-

Government Focus

• Critical Goals•••

Internal/Financial Focus

• Critical goals•••

Co-worker Focus

• Critical Goals•••

We make the good journeypossible.

Development focus

• Critical Goals•••

Customer Focus

• Critical Goals•••

VISION

Risk Analysis

Plan for Action

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• Hazard within the Road Transport System

• Hazard from Surroundings

• Hazard from the Road Transport System

Crisis Management – Main Scenarios

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RM in Network Management / Infrastructural Project

StrategicPlanning

PhysicalPlanning Construction

Roads in use(Maintenance)

Riskprofile deliveries to risk owners (contractor, consultant, municipality, project sponsor, etc.) and demands for supplier’sown Risk Management.

Deliveries DeliveriesDeliveries Deliveries

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The Southern Link in Stockholm – Successful ”Mega Project”

• 6.5 km road length in total

• 4.5 km mining tunnel in each direction

• Total tunnel length 17 km

• Opened October 2004

• Traffic volume 75,000 vehicles per day

• Cost 1100 million US Dollar

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The Southern Link in Stockholm

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What Happened in the Project Southern Link

• Strikes• Burglaries• Damage• Sheet piling penetrating gas conduit• Settling of houses and pipes• Sheet piling penetrating water-pipe• Collapse of footbridge• Building crane falling down• Rock nail missing in the sheet piling• Settling after freezing activity

• Rockslide• Flooding• Ceiling-fire• Sunk water level in a lake• Explosion accidents• Need of extra cable culvert• Mould in the evacuating tunnel /

equipment• Epoxi would not harden• Dispute with contractors

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Short Checklist for Project RM

• Decide on a plan for the project’s Risk Management• For larger projects appoint a coordinator for Risk Management • Best qualified to deal with the risk should undertake it• Project´s top 10 ranking risks delivered to the next phase with

suggestions for measures• Requirements in the contract for the contractor’s own RM• Perform the risk analysis based on the two perspectives

- Contractor phase- Road using phase

• During construction always prioritize safety, working environmentand environment along with Time-Cost-Function

• Keep the analysis up to date

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Road Using Phase –One PossibleApproach

• The map shows prioritization of the links based on the road userperspective, which causes most public economy damage if not operational (has high traffic volume and long reservealternative road).

• Investigate probability for hazards (e.g. snowstorms, windstorms, landslides, fog, accidents) for the highest prioritizedlinks.

• Complete with e.g. source of water supply, dangerous goods transportation, hospitals.

• Evaluate, rank the risks and carry outrisk reduction measures.

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5

4

3

2

1

PROBABILITY

CONSEQUENCES

Risk class 3 Risk class 2 Risk class 1

1 2 3 4 5

Which ASSETS/OBJECT can be damaged?

· within VTS · in the surroundings

Person Property Environment Finance Intangible

1

Which DANGERS can cause damage? · from VTS · from the surroudings

RISK FACTORS Which causes?

Which DAMAGE- EXTENT?

· min · type · max

RISK LEVEL

How urgent is the action?

PROBABILITY How probable?

CONSEQUENCE total damage value

POSSIBLE RISK REDUCING

ACTION · costs? · Effect on risk

6

4

4 2

3

5

×

3

A summary of thework procedure

INSTRUCTIONS – RISK ANALYSIS CHOSEN ROAD STRETCH

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Risk Management Must Have Active Support From the Management – Otherwise It Will Not be Successful.

It will not always be as it’s meant to be….things do happen!

20 2010-05-19

Risk Treatment Logic

risk treatment

carry avoid

control

reduce / eliminate

residual risk

accept / retain

Despite control action exposures that are not avoided or eliminated still exists

transfer / share

risk evaluation domain

the strategic choice

Risk treatment options

risk treatment

carry avoid

control

reduce / eliminate

residual risk

accept / retain

Despite control action exposures that are not avoided or eliminated still exists

transfer / share

risk evaluation domain

the strategic choice

Risk treatment options