OPERATIONAL RISK

MANAGEMENT
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Introduction

1. Risk management is a formalised way of dealing with hazards. It is the logical process
of weighing the potential costs of risks against the possible benefits of allowing those risks to
stand uncontrolled. In order to better understand risk management, the terms “hazard” and
“risk” need to be understood first. Hazard is a present condition, event, object, or
circumstance that could lead to or contribute to an unplanned or undesired event such as an
accident. Recognizing hazards is critical to beginning the risk management process. Risk is
the future impact of a hazard that is not controlled or eliminated. It can be viewed as future
uncertainty created by the hazard. Therefore to understand risk, one should be able look
past the immediate condition (hazard) and project the progression of the condition
into the future. Hazard and risk are the two defining elements of risk management.

Risk Management

2. Risk management is the method used to control, eliminate, or reduce the hazard and
thereby manage the associated risk within parameters of acceptability. However, perception
of ‘hazards’ and the ‘parameters of acceptability’ are greatly influenced by individual traits
and experience. Therefore, standardisation becomes a great challenge. The organisation
does provide some basic tools, in the form of regulations and SOPs, to recognize hazards.
These provide restrictions to actions and thereby reduce hazards by establishing a threshold.
An example is the visual flight rules (VFR) weather minima which provides an operational
boundary that a pilot can use in helping to recognize a hazard. It was the need to reduce the
dependency on individual traits in risk management that led to the concept of ORM.

.What is ORM?

3. ORM is a decision-making tool to systematically identify hazards, predict the

associated risks and determine the best courses of action for any given situation within the
acceptable parameters laid down by the organisation. ORM is pre-emptive, rather than
reactive, thereby ensuring that it is not restricted to focusing only on hazards that have
caused problems in the past.
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The ORM Process

4. Every ORM process follows six basic steps (Fig 1), each of which is as important as
the other.

Fig 1: The ORM Process

Fig 1: ORM Process

(a) Step 1: Identify the Hazard. The first step of the process is to identify the
hazard and attendant risk(s). In aviation, experience, training and common sense
help pilots spot hazards quickly and accurately. Further clarity on the associated risks
can be achieved by classifying them into different types as given in Fig 2 and further
enumerated in Fig 3.
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Types of Risks

Identified Risk Risks that have been determined using analytical tools
like Logic diagrams, Flow charts, Dependency mapping
tools etc. The time and costs of analysis efforts, the
quality of the risk management program, and the state
of the technology involved decide the amount of risk
that can be identified.

Unidentified Risk Risk not yet identified. Some unidentified risks are
subsequently identified when an accident/incident
occurs.
Some risk is never known.

Total Risk The sum of identified and unidentified risk

Acceptable Risk This is part of the identified risk that is allowed to

persist after controls are applied. Risks are deemed
acceptable when further efforts to reduce it would
degrade the probability of success of the
operation/mission.

Unacceptable Risk Risk that cannot be tolerated by the organisation. It is a

subset of identified risk that must be eliminated or
controlled.

Residual Risk Residual risk is the risk remaining after risk

management efforts have been fully employed. It is not
necessarily the same as acceptable risk. Residual risk
is the sum of acceptable risk and unidentified risk. This
is the total risk passed on to the user.

Fig 2: Classification of Risks

Fig 3: Types of Risk

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(b) Step 2: Assess the Risk. The most basic tool for risk assessment is the
risk matrix (Fig 4). It is created by assessing two factors: the likelihood of an event
occurring and the consequence of that event.

Catastrophic Critical Marginal Negligible

Probable High Risk High Risk Serious Risk Medium Risk
Occasional High Risk Serious Risk Medium Risk Low Risk
Remote Serious Risk Medium Risk Medium Risk Low Risk
Fig 4: Risk Matrix
Improbable Medium Risk Medium risk Medium Risk Low Risk
Fig 4: Risk Matrix

(c) The remaining steps of the ORM process have been illustrated with the help of
the following scenario:

Illustration of the Six Step ORM Process

An aircraft has been offered for a ground run after an engine change. Identify and implement
risk control measures associated with conduct of the ground run.

Step 1: Identify Hazards. Based on common sense and previous experience, the
following hazards can be identified:
- Fire during the ground run.
- FOD damage due to tools/equipment inadvertently left behind in the
engine by the tradesmen.
- Vibrations due to loose fitting/engine mounts.
- Inadvertent movement of ac due to improper picketing/parking brakes not
holding.
- Seizure of engine due to oil leak as a result of inadequately tightened
lubrication pipes.

Step 2: Assess the Risks. Based on severity and exposure to men and material, ‘Fire
during the ground run’ would qualify as the top ranking risk.

Step 3: Analyse Risk Control Measures. Measures to control the risk of ‘Fire during the
ground run’ can be determined by studying the risk based on its three components,
probability of occurrence, severity of the hazard, and the exposure of people and
equipment. Thereafter, measures to mitigate/eliminate any one of these components would
result in the control of the risk. The measures to mitigate/eliminate each of the three
components are given in the table below:
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Risk Component of Risk Measures to Mitigate/Eliminate

Fire during the Probability of - Ensure no fuel accumulation in the engine
ground run Occurrence chambers by first carrying out vent run.
- Fuel in the ac tanks to be just adequate for
the ground run
- Ensure proper connection of the fuel lines.
Severity of the - Ensure presence of CFT on site for the
Hazard ground run
- Ensure subsidiary fire fighting
equipment(DFT) is on stand by.
- Ensure no inflammable material or
equipment (eg, refuellers) in the vicinity.
Exposure of People - Ensure that the ground run is carried out at
and Equipment a bay that is sufficiently displaced from other
ac, equipment and personnel.
- Only personnel that are essential to the
conduct of the ground run should be present
in the vicinity.

Step 4: Make Control Decisions. The risk control decisions would have to be taken at a
level that has the resources to implement the risk control measures taken in step 3. For
example, one of the control measures was the requirement of the CFT on site. The CFT is a
resource that is controlled by the SATCO. Therefore the clearance for the round run would
have to be taken from the SATCO, as he has to provide the CFT.

Step 5: Implement Risk Controls. The risk control is effectively implemented through the
formulation of SOPs and Orders that specify the location, the precautions to be adopted,
mandatory resources etc for the conduct of a ground run. In addition, responsibilities for
various aspects of the ground run are assigned.

Step 6: Supervise and Review. The controls that have been put in place must be
constantly reviewed and re-assessed to check for any shortfalls in content and
implementation.

Principles of ORM

5. Four principles govern all actions associated with operational risk management. These
continuously employed principles are applicable before, during and after all tasks and
operations. These are also applicable to all individuals at all levels of responsibility.

(a) Accept No Unnecessary Risk. Everything involves risk. The most logical
choices for accomplishing an operation are those that meet all requirements with the
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minimum acceptable risk. Unnecessary risk is that which carries no commensurate

return in terms of benefits or opportunities.

(b) Make Risk Decisions at the Appropriate Level. Anyone can make a risk
decision. However, the appropriate decision-maker is the person who can allocate the
resources to reduce or eliminate the risk and implement controls. He should elevate
decisions to the next level if the controls available to him do not reduce residual risk
to an acceptable level. This aspect is illustrated with the following scenario:

A MOFT U/T ops pilot is planned for a GH sortie. The weather is cloudy and
sector is likely to be under cast. The sector is located close to the IB. The only GPS
receiver available in the Sqn has become u/s. The base radar is non-ops as it is being
taken up for PMI. Considering the close proximity of the IB, the Flt Cdr decides that
non-availability of GPS receivers poses a risk in terms of Sector maintenance and
apprises the COO. COO informs the Command HQs. Command HQ decides to
delay the PMI of the radar and make it available for the sortie. The Flt Cdr raised the
level of the risk decision to a higher level (COO), who in turn raised it to the Command
HQ level as the necessary risk control resource (radar) was under their control.

(c) Accept Risk When Benefits Outweigh the Costs. All identified benefits
should be compared against all identified costs. Even high-risk endeavors may be
undertaken when there is clear knowledge that the sum of the benefits exceeds the
sum of the costs. Balancing costs and benefits is a subjective process, and ultimately
the balance may have to be arbitrarily determined by the appropriate decision-maker.
This is illustrated with the following scenario:

Normal helicopter operations, in the IAF, to helipads above 8000’ AMSL are restricted
to 1200 hrs. The reason for this is the risks due to turbulence, wind shear and
downdraughts. However for casualty evacuation flights, these restriction is waived off,
with prior permission of Command HQs. Thus, risks that are unacceptable for normal
operations become acceptable for casualty evacuation missions. The change from an
unacceptable to acceptable risk in this example is more subjective than objective and
probably arbitrarily determined by the appropriate decision maker (Command HQs).

(d) Integrate Risk Management into Mission Planning, Preparation, and Execution.
Risks are more easily assessed and managed when ORM is implemented right
from the planning stages of an operation. The ORM process should start as soon
as the objectives of the mission are laid out. Delays in ORM implementation during the
process of planning and executing an operation would render the process more
expensive, time-consuming and less effective.
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Time-Critical ORM

6. Time-Critical or Cockpit ORM is an "on the run" process of learning how to identify
problems, analyze the information, and make informed and timely decisions in a time-
compressed situation using the basic risk management process. Learning how to judge a
situation and “how to think” in the endless variety of situations encountered while flying out in
the “real world” is a very difficult preposition. Each pilot is expected to analyse each situation
in light of experience level, personal minimums, and current physical and mental readiness
level, and make his or her own decision. In the past few decades, attempts have been made
to aid pilots’ decision making by the use of acronyms (models) that attempt to prompt the
pilot to include all necessary parts of the decision making process. A few of these models
have been enumerated below. A suggested quick reference card for cockpit ORM is also
placed as Appendix.

Fig 5: 3-P Model

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DETECT
ASSESS
DECIDE
ACT

DETECT
See, hear, smell or feel cues
Instrument displays
Pattern recognition

ASSESS
Compare with something familiar
Form a mental model
Pattern match

DECIDE
Evaluate the relative importance
of the information
Review patterns and mental
models
Identify suitable action – a pattern
or mental model

ACT Fig 7: DECIDE Model

Monitor
Review the situation
Plan ahead

Fig 6: DADA Model

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3-P Model

7. The 3P model is a very simple yet effective method for carrying out cockpit ORM. With
practice, the 3P model could become second nature for pilots, a mental equivalent to the
physical scan patterns utilised for checking airplane configuration and instruments.

(a) The first step (first ‘P’) in this model is to identify or Perceive hazards, which
are events, objects, or circumstances that have contributed to an undesired event.
Thereafter segregate the perceived hazards by looking at:
Pilot……..Experience, Condition, Currency
Aircraft………..Fuel Reserves, Ac performance, Ac equipment
enVironment…….Weather, Terrain, R/W condition, Radar availability etc
External Factors……..Deadlines, Mission accomplishment, Professional
pride, Family pressures etc.
For managing risks associated with ‘Pilot’, ‘Aircraft’ and ‘Environment’, pilots are
assisted by SOPs, orders and regulations to establish a risk threshold or clear cut
go/no-go criteria. However, the same is not the case for ‘External factors’. The
absence of such SOPs, orders or regulations results in risk management of
external factors being greatly influenced by individual traits. Therefore, risks
associated with ‘external factors’ are the most difficult to manage.

(b) The second step (second ‘P’) is to Process risk level by considering:
What are the Consequences?
What are the Alternatives available to me?
What is the Reality of the situation facing me?
What kind of External pressures may affect my thinking?

(c) The third and final step is to Perform risk management by:
Transfer - Can this risk or risk decision be transferred to someone
else?
Eliminate - Can you remove the hazards?
Accept -- Do the benefits of accepting risk outweigh the dangers?
Mitigate -- What can you do to mitigate the risk?

8. The 3P model is can be better understood by applying it to the scenario below:

A young Flt Lt is ferrying a Mig-21 ac back to base after a long det. As the pilot approaches
over head the destination, the R/W gets blocked. The R/W is taking longer than originally
estimated to become operational. The only available diversion is a busy civil airfield. The pilot
is not familiar with this airfield. The last landing time is fast approaching and fuel is becoming
critical for the diversion.
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Step 1: Perceive Hazards using the PAVE checklist.

Pilot Aircraft EnVironment External Factors
- Distraction of - Criticality of Fuel - Last landing time - Different recovery
unfamiliar place - No on board aids - Enroute head procedures at civil
could degrade SA like VOR/DME to winds would airfields
aid recovery at the aggravate the - Unfamiliarity of AF
civil airfield situation vs professional
- No arrester barrier pride
- Get homitis

Step 2: Process risk levels with CARE

Consequences Alternatives Reality External factors
- Loss of SA due - Ask SU to co- - No scope for nav - Stretch decision to
distractions ordinate with civil errors hold over own base
associated with ATC - Need to land off to avoid going to
unfamiliar - Declare fuel the first approach at the civil airfield
procedures/requests emergency an unfamiliar AF -TRS and recovery
from the civil ATC - Jettison DTs - Last landing time from the civil airfield
- Could run out of - Planned Ejection - Flame Out
Fuel

Step 3: Perform risk management using the TEAM checklist.

Transfer Eliminate Accept Mitigate
- Ask the SU to co- - Take input of - Risk associated - Jettison DTs
ordinate with the winds and divert in with non-availability -Critical navigation
civil ATC thereby time to be within of arrester barrier. and planning to
transferring the last landing time -Non availability of identify the airfield
associated and with adequate compatible in time and land of
distractions to the fuel recovery aids the first approach if
SU required

Pre-requisites for Effective Time-Critical ORM

9. Cockpit ORM capabilities of a pilot would depend on the possession of certain solid
skills that can be broadly divided into three distinct, but interrelated groups.

(a) “Physical Airplane” Skills. This refers to the pure flying skills ie. basic
stick-and-rudder proficiency. Good flying skills ensure adequate spare mental capacity
to carry out cockpit ORM.
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(b) “Mental Airplane” Skills. This refers to the knowledge and proficiency in
aircraft systems. Without adequate knowledge of the capabilities and limitations of the
on board equipment, they cannot be fully exploited.
For eg. When faced with a requirement to land as soon as possible due to an
emergency, knowledge of the ‘nrst’ function of the GPS receiver could hasten the
decision making.

(c) Aeronautical Decision-Making Skills. Aeronautical decision making

(ADM) provides a structured and systematic approach to analyzing changes that
occur during a flight and how these changes might affect a flight’s safe outcome.
Thereafter, it helps pilots to consistently determine the best course of action based on
the latest information available. The importance of learning and understanding
effective ADM skills cannot be overemphasized. Inadequate ADM skills are the sole
reason why accidents occur inspite of the advancements in the field of aviation.

Cognitive Biases that Impede Cockpit ORM

10. Cognitive bias is a general term used to describe the distortions in the human mind
that lead to perceptual distortion, inaccurate judgment, or illogical interpretation. These
biases are due to the inherent psychological limitations of the human mind and require a
conscious effort to eliminate. These include:

(a) Plan Continuation Bias. Plan continuation bias is defined as

failure to revise a flight plan despite emerging evidence that suggests it is no
longer safe. One reason for this is a deep rooted belief that the default plan has
always worked before and a change might throw up unknown variables. Another
reason is that the human mind finds reactive responding much easier than proactive
thinking and changing the plan in-flight would definitely necessitate proactive thinking.
Almost every weather related accident and most landing accidents are due to this
bias. Key aspects of this bias include:

(i) Tendency to justify continuation by not giving due cognizance to cues

that suggest a change in plan is required while giving undue weightage to even
minor cues that tend to support continuation of the plan.

(ii) It becomes stronger as one nears completion of activity

(e.g. approach to landing).

(iii) Get hom-itis strongly reinforces this bias.

(b) Confirmation Bias. This is a tendency for people to favour information

that confirms their preconceptions, regardless of whether the information is true. Even
when presented with contrary evidence, he/she will tend to ignore that evidence, but
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will seize with alacrity any small detail which reinforces the preconception. Essentially,
you see what you want to see. Confirmation biases can therefore maintain or
strengthen beliefs in the face of contrary evidence, leading to potentially disastrous
decisions. A classic example of this bias is trying to fit the ground to the map when not
very sure of position during LLN and trying to convince oneself that the navigation is
progressing accurately.

(c) Frequency Bias. This is the tendency to call to mind frequently encountered
experiences or scenarios and applying them to an inappropriate scenario. For
example if a pilot has previously experienced a tyre burst during T/O, the next time he
hears a bang on T/O roll, he will straight away assume that it is a tyre burst.
Frequency bias can also lead you to see a routinely observed object as it normally
appears, even when its current appearance is actually different. An example is pilots
reporting ‘three greens’ when the undercarriage is still retracted.

Improving ORM in IAF

11. The formal ORM process in its present form is more of an ‘add on’ and therefore not
fully integrated into the mainstream operational process. This makes it less effective. The
following are some suggestions to improve the ORM process in IAF:

(a) ORM must be made an integral part of all role SOPs. It must not be undertaken
as a separate exercise.

(b) All missions must have ORM as one of its objectives. Based on the ORM,
decision matrices with specific go/no-go parameters should be worked out. These
parameters may be reviewed and no-go decisions may be revoked at higher levels of
the chain of command if the mission requirement so warrants. Performance of ORM
tasks should be assessed in the mission debriefs. The medium of the AFNET could be
utilised to make pre-flight ORM an online process and therefore more dynamic.

(c) COIs into accidents/incidents should specifically assess and comment on

whether ORM process weaknesses were a causative factor to the accident/incident.
ORM process improvements should also form part of the recommendations.

Conclusion

12. In the last 20 years, approximately 85 percent of aviation accidents have been caused
by “pilot error.” Many of these accidents are the result of the tendency to focus flight training
purely on the physical aspects of flying the aircraft while paying inadequate attention to the
cognitive aspects of aviation. A training program that integrates risk management into
flight training would teach aspiring pilots how to be more aware of potential risks in flying,
how to
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clearly identify those risks, and how to manage them successfully. The risks involved in
aviation are quite different from those experienced in daily activities. Managing these risks
require a conscious effort and established standards (or a maximum risk threshold).

References

1. FAA Aviation News Magazine May – June 2005 Vol- 44 . Number 3: Susan Parson:
Article ‘Practical Risk Management in Flight Training’

2. Tony Kern (1998) ‘Flight Discipline’

3. FAA System Safety Handbook, Chapter 15: Operational Risk Management:

4. Richard S Jensen (1995) ‘Pilot Judgment and Crew Resource Management’:

Chapter 11, Risk Management in Aviation

5. FAA Pilots Handbook of Aviation Knowledge.

6. FAA Risk Management Handbook.

7. Oxford Aviation Services Limited; Jeppesen Manual; Book 08: Human Performance
and Limitations.
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Appendix

COCKPIT ORM QUICK REFERENCE GUIDE

Pilot Aircraft Environment External Factors

Detect Change

No Time Time Available

Land as soon as Confess / Climb / Conserve / Consult

conditions permit

PRIORITIES Identify Hazards

• AVIATE
• NAVIGATE
• COMMUNICATE
• PREVENT INJURY
Pilot Aircraft Environment External
• PREVENT DAMAGE
• MISSION COMPLETION
Factors

WATCH OUT!!
• FIXATION
Transfer / Eliminate / Accept / Mitigate
• LOSA Hazards
• PLAN CONTINUATION
ERROR
• CONFIRMATION BIAS
• FREQUENCY BIAS Solution

Execute

Review

Successful
Not
Successful

Re-evaluate
Post landing
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Explanatory Notes

1. Any in-flight change would be related to one or more of four elements viz pilot, aircraft,
environment or external factors.

2. The portion shaded yellow is the 4-C checklist for an in-flight change.
• Confess - Admit to yourself and your crew that the situation has changed and a
new plan is required. This establishes the increased risk level.
• Climb - If at low levels, or if higher altitude is advantageous in terms of
weather/ R/T range/ Fuel consumption, climb.
• Conserve - Conserve fuel, as the new plan might require more than originally
planned
• Consult - Get help. Look at all available resources to professionally re-plan the
situation

3. The activities in the portion shaded red constitute the most critical portion of the
process and would cause the maximum drain on the cockpit spare mental capacity.

4. Top priorities during the shaded portion of the process should be:
• Aviate – Ac control in terms of attitude, speed, altitude.
• Navigate – Terrain/Weather avoidance, funneling into the intended recovery
point.
• Communicate – Inform external agencies of changes, traffic de-confliction,
requirement of assistance etc.

5. While deciding on a solution, ensure that:

• There is no fixation on the problem
• SA is maintained at all times through regular scanning for information and
seeking feedback.
• Cognitive biases do not affect the solution/decision.

6. Review of the process after landing is often a very neglected and yet very important
aspect. Review can be done by seeking answers to the following questions:
• What went well?
• What could have been better?
• What should I do differently if I encounter similar conditions in a future flight?
• What is the skill that I most need to practice and improve?