Risk assessment requires evaluating both consequence and likelihood of an occurrence or failure. It starts with consequence:
- If consequence of failure is high:
- Value of knowing likelihood is high
- It is worth spending on inspection and assessment to establish this
- If consequence of failure is low:
- Knowing likelihood is unlikely to change decisions
- Therefore value of knowing likelihood is low
Inspection and condition assessment establish likelihood of failure. This is a quantitative calculation of likelihood from audit & inspection data.
- High likelihood: focus on rehabilitation & replacement
- Low likelihood: develop intervention plan for fail & fix approach
A proper risk assessment:
- Enables prioritisation and focus on high-priority and high-risk assets.
- Drives asset management budgets for maximum cost-effectiveness.
