6.5.3.2 Risks

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6.5.3.2

Risks

When assigning responsibilities for managing risks, different types of risks are normally assigned to different individuals or divisions within a transportation agency:

  • Strategic risks – Impact the agency’s ability to achieve its goals and objectives. Ignoring risks at this level can cascade down to impact programs and projects at other levels of the agency. For this reason, strategic risks are generally assigned to members of agency leadership and may be addressed by incorporating risks into regular management meetings and key policy documents.
  • Program risks – Impact an organization’s ability to administer a program in a coordinated way. Risks at this level are typically the responsibility of the program manager ensuring there are effective controls over risk and documenting risk activities.
  • Project risks – In many agencies, a project risk management process is in place with responsibility for managing risks assigned to the project manager. At this level, primary responsibilities include managing risks associated with the project scope, schedule and quality.
  • Activity risks – Associated with routine activities performed by the agency, such as snow and ice control, incident response and pavement management modeling. Risks at this level are typically managed and monitored by the activity leader.

An agency may elect to appoint a Chief Risk Officer or to create an Enterprise Risk Unit charged with coordinating the agency’s risk processes and training agency personnel on risk management. If such a unit is created, the Chief Risk Officer often reports directly to the agency’s chief executive officer or another high-ranking executive, symbolizing the importance of risk management to the agency. Agencies without a formal Risk Unit may rely on the Asset Management Coordinator to serve in this role. Examples showing how risk roles and responsibilities have been assigned are provided in Figures 6.8 and 6.9.