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Crisis Management Models for Risk Assessment Case Study


Introduction

Crisis management is an essential strategy that organizations employ in the prevention and mitigation of hazards threatening to harm humans and property6. Crisis management models are applicable in the assessment of terrorism and other risk events that are common in various organizations4, 5. Effective crisis management is possible when there is a reliable forecast of risks that a given organization faces. ISO-30000 offers an elaborate risk management process comprising risk identification, risk analysis, and risk evaluation3. Risk identification enhances the forecast of risk for it entails an assessment of an organization, strategic operations, and social, political, economic, technological, cultural, and legal environment. Risk analysis provides a way of profiling risks and mapping them to specific areas requiring urgent attention, and thus, improving the reliability of the forecast. The review of risk identification and analysis requires risk evaluation to update the dynamics of threats and hazards that an organization faces.

The process of Threat and Hazard Identification and Risk Assessment (THIRA process) offers four phases of forecasting and handling risks1. The first phase involves the identification of threats and hazards from humans, the natural environment, and technology-based on potential risks, experiences, and expertise. Contextualization of threats and hazards by describing their occurrence regarding time, location, and conditions promote the reliability of the forecast. The third phase of the THIRA process is the establishment of capability targets by undertaking the quantitative assessment of impacts such as the size of an area affected the number of displaced households, the number of injuries, the number of deaths, and the extent of infrastructure damaged1.

The last phase entails the forecast of resources required to prevent the occurrence of threats and hazards as well as protect communities through recovery and mitigation strategies. The National Preparedness System has stipulated six steps of forecasting threats and hazards. These steps are identification and assessment of risks, estimation of capability requirements, creation and sustenance of capabilities, delivery of capabilities, validation of capabilities, and review and update of capabilities2. The THIRA process and the National Preparedness System permit reliable prediction of risks and consequently plan for effective response to prevent and mitigate. In this view, the study seeks to undertake vulnerability and risk assessment of Rice University’s Baker Institute of Public Policy.

Vulnerability and Risk Assessment Practical Application Assignment

The following table identifies vulnerabilities and risk scenarios events of the Baker Institute of Public Policy at Rice University. The identified vulnerabilities and risk scenarios are flood, hurricane, earthquake, mass protest, campus shootings, terrorism, power outage, water outage, arson, electrical fire, robbery, cybercrime, sexual abuse, disease outbreak, political clashes, hostage situation, bomb threat, elevator failure, racial fights, and food poisoning. To assess the relative risk of each of the risk events, the assessment tool quantified the probability of occurrence, impact on students, impact on staff, impact on learning, the preparedness of the institution, and the effectiveness of mitigation measures.

Table 1: Vulnerability and Risk Assessment Tool for the Baker Institute of Public Policy at Rice University.

PROBABILITY IMPACT ON STUDENTS IMPACT ON STAFF IMPACT ON LEARNING PREPAREDNESS MITIGATION RELATIVE RISK
Percent likelihood of occurrence The extent of injury or death The extent of injury or death The extent of disruption of learning The extent of preparedness The effectiveness of mitigation
SCORING KEY Percent (0-100%)
  1. Low impact
  2. Moderate impact
  3. High impact
  1. Low impact
  2. Moderate impact
  3. High impact
  1. Low impact
  2. Moderate impact
  3. High impact
  1. Limited or none preparedness
  2. Moderate preparedness
  3. Significant preparedness
  1. Low effectiveness
  2. Moderate effectiveness
  3. High effectiveness
Percent risk (0-100%)
RISK SCENARIOS
1 Flood 50 3 3 3 2 2 52.65
2 Hurricane 40 3 3 3 2 2 41.45
3 Earthquake 20 3 3 3 1 2 19.63
4 Mass protest 30 2 2 3 3 2 25.10
5 Campus shooting 10 3 2 3 2 1 3.71
6 Terrorism 10 3 2 3 2 1 3.71
7 Power outage 20 2 3 3 2 3 12.85
8 Water outage 20 2 2 3 2 3 11.38
9 Arson 10 3 2 2 1 2 2.00
10 Electrical fire 10 3 2 3 1 2 3.71
11 Robbery 20 1 2 2 2 2 11.21
12 Cybercrime 60 2 3 3 2 3 61.15
13 Sexual abuse 40 1 1 1 2 3 32.58
14 Disease outbreak 20 2 2 2 3 2 9.87
15 Political clashes 30 2 1 2 2 2 24.74
16 Hostage situation 20 3 1 3 2 2 14.10
17 Bomb threat 20 3 2 3 2 2 15.50
18 Food poisoning 30 2 1 1 2 2 23.47
19 Racial fight 20 1 1 1 2 3 5.14
20 Elevator failure 20 1 1 1 3 3 2.31
MEAN 25 2.25 1.95 2.4 2 2.2 18.81
RELATIVE RISK = SUM OF IMPACTS/(SUM OF IMPACTS + PREPAREDNESS + MITIGATION )* 100%

Risk assessment using the designed tool shows that the institution has a high probability of the occurrence of natural disasters such as a hurricane and flood and human actions such as cybercrime. The mean of the occurrence of risk events is 25%, which means that these events are unlikely to occur in the institution. Risk events such as hurricane, flood, earthquake, campus shootings, hostage situation, bomb threat, terrorism, arson, and electrical fire have a high or moderate impact on students, staff, and learning. On average, these risk events have a higher impact on learning (M = 2.4) when compared to staff (M = 2.25) or students (M = 2.24). The assessment of the preparedness shows that the institution has moderate preparedness (M = 2) while the effectiveness of mitigation is also moderate (M = 2.2). The findings suggest that the institution needs to review its preparedness to enhance its effectiveness in mitigating the occurrence of risk events. The assessment of relative risks for flood, hurricane, and cybercrime 52.65%, 41.45%, and 61.15% respectively, which are relatively higher than those of other risk events. Mass protest, sexual abuse, political clashes, and food poisoning have relative risks of 25.1%, 32.58%, 24.74%, and 23.47% correspondingly. Other risk events have low relative risk values of less than 20%.

The data obtained from the assessment tool was used to generate a heat map to illustrate the distribution of risk events in terms of probability and impact on students, staff, and learning. The heat map shows that most risk events are probable and have a high impact on students, staff, and learners. However, few risk events are likely to occur and have high impacts on students, staff, and learners.

Heat map depicting the distribution of impact and probability.
Figure 1: Heat map depicting the distribution of impact and probability.

The risk matrix below classifies risk events into four categories depending on their probability level and impact level. Most risk events, namely, arson, earthquake, campus shooting, terrorism, electrical fire, disease outbreak, hostage situation, bomb threat, water outage, and power outage have probabilities lower than 30% and impact level of above 7. Flood, hurricane, cybercrime, and mass protest have high impact levels of greater than 7 and probabilities 30% and above. Racial fight, elevator fight, and robbery are risk events that have impacts lower than 7 and probabilities lower than 30%. Comparatively, sexual abuse, food poisoning, and political clashes are risk events that have low impact levels of less than 7 and high probabilities of 30% and above.

Risk matrix.
Figure 2: Risk matrix.

References

, DHS, Second Edition, 2013. Web.

“National Preparedness System”, DHS, 2011. Web.

“A Structured Approach to Enterprise Risk Management (ERM) and the Requirements of ISO-31000”, AIRMIC, alarm, IRM. Web.

Willis et al. (2005). RAND. Web.

Poland, James M. “Understanding Terrorism: Groups, Strategies, Responses”. Prentice Hall, 2011. Chapters 2, 7, and 8.

Fink, Steven. “Crisis Management, Preparing for the Inevitable”. AMACOM, 1986. Chapters 6, 8, 10.

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IvyPanda. "Crisis Management Models for Risk Assessment." January 10, 2021. https://ivypanda.com/essays/crisis-management-models-for-risk-assessment/.

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IvyPanda. 2021. "Crisis Management Models for Risk Assessment." January 10, 2021. https://ivypanda.com/essays/crisis-management-models-for-risk-assessment/.

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