Integrated Risk Management Model Research Articles

An Integrated Risk Management Model for Transporting Explosive Remnants of War: A Case Study in the Republic of Serbia

Existing legal and by-law regulations prescribe risk management methodologies for various domains, such as the transportation of hazardous materials, fire and explosion protection, environmental protection, and protection against chemical accidents. However, there is a lack of comprehensive methodological guidance that unifies the management of all risks associated with the transportation of explosive remnants of war (ERW), which pose significant threats to human life, cultural assets, and the environment. Furthermore, the transportation of ERW often occurs along traffic corridors with compromised infrastructure, increasing the range of potential risks affecting the safety of people, their property, and critical infrastructure. This study presents an integrated risk management model for ERW transportation in the Republic of Serbia, developed based on current legal and by-law regulations, as well as modern criteria and risk assessment methodologies. By applying this model, the various risks associated with ERW transportation can be effectively mitigated, ensuring the safety and protection of people, assets, and the environment.

Climate Risks and Opportunities of the Marine Fishery Industry: A Case Study in Taiwan

As climate change and extreme weather intensify, forecasting natural environmental changes involves high uncertainty and variation. Planned policy changes and the ability of fisheries to withstand these changes and impacts are major challenges in regard to addressing future climate hazards in Taiwan. Taiwan’s geographic location is favourable for the marine fishery industry, which is an important primary industry and a source of animal protein for residents of Taiwan. Recently, both long-term climate change and extreme climate hazards have led to shocks in the marine fishery industry. The resulting instability of the industry directly affects the market supply of and demand for seafood. We conduct a case study of a marine fishery industry in Taiwan that incorporates social concern assessments of risk perception and judgements of risk acceptance through risk management processes. Furthermore, we incorporate stakeholder participatory processes to reduce the gap in awareness of adaptation and to increase the opportunity to reach consensus and develop an integrated risk management model that enables decision-makers to better meet the needs of society. These measures will enhance all parties’ willingness to adapt and help achieve the goal of public–private collaboration in facing climate change challenges.

An Integrated Risk Management Model for an Oil and Gas Company

Oil and gas companies’ returns are heavily affected by price fluctuations. In financial terms, the “price in—price out” dynamics influence companies’ gross margins and impact to a high extent on their multiyear budgets and accomplishment of goals. Due to world scale size and geographically scattered organizations oil and gas companies use separate hedging tactics to protect each of their business units (e.g. crude oil production, oil refining and natural gas) from the risk associated with the fluctuation of prices. The present research compares, for an oil and gas company, the results of using a “hedging at business unit level” approach with the results of employing a “hedging at company level” approach, by finding the best derivatives portfolios through coherent risk measures and stochastic optimization. The analysis is subsequently extended to a utility based approach, where the company’s risk tolerance is included.

Enhancing organizational sustainability: The green construction way

With the increase in global population (Roser, Ritchie, Ortiz-Ospina, & Rodés-Guirao, 2019), the construction industry has grown exponentially contributing to the economic and social development of a country. But due to massive contribution to environmental pollution (“How Does Construction Impact the Environment?”, 2021), a significant portion of construction projects are being developed as green and sustainable. Green construction projects are exposed to some unique risks; hence, the management of these risks is crucial to ensure organizational sustainability. However, limited research has been reported bridging the gap and linking the risks with organizational sustainability. The objectives of the present study are to identify the correlation of the risks with organizational sustainability and model development for risk mitigation. Semi-structured interviews, Spearman rank correlation, regression analysis, and interpretive structural modelling (ISM) have been used as research methods. Results show a strong negative correlation between the risks with sustainability, the environment as the most significant sustainability driver, and an integrated risk management model is developed. Organizational theories are well supported by the study results. The study benefits construction project managers in more systematic and structured thinking towards relating the green construction risks with sustainability, understanding the sustainability drivers and managing the risks through the integrated risk management model thus successful project execution ensuring organizational sustainability

Development of integrated asset management model for highway facilities based on risk evaluation

Highways are vital infrastructures that play a crucial role in providing social welfare. Highway structures could experience different types of deterioration (e.g. pavement ageing, pavement cracking, potholes, bridge structure deteriorations, and rockfall due to unstable slopes). Minimal attention has been directed towards developing a comprehensive model to effectively reduce the potential hazards for the entire highway network while considering the associated individual and overall risks. An integrated risk management model is used to separately assess each section's risk value and the extent of its impact on the network. An efficient model has been developed to identify the highway sections that its maintenance will effectively reduce the total risk within the highway network. The developed model competence is examined and verified after evaluating a four major highway network in Florida. The results of the highway's analysis were compared for all routes within the network. Also, the developed model's proficiency in optimally reducing the network's overall risk is presented. The proposed model could be utilized as a support-decision tool to decide which highway segments must be maintained to minimize the network's potential risk.

Design of Integrated Risk Management Model as A Core for Integrated Management System (Case Study: in Chemicals Industry)

Design of Integrated Risk Management Model as A Core for Integrated Management System (Case Study: in Chemicals Industry)

Kontekstualna zavisnost primene integrisanog modela mendžmenta rizikom od veličine preduzeća

Novel integrated risk management model for standardized management systems, such as ISO 9001:2015 for quality management systems, ISO 14001:2015 for environmental management systems, ISO/IEC 27001:2013 for information security management systems, ISO 45001:2018 for occupational health and safety management systems, and ISO 22000:2018 for food safety management systems, has been proposed in order to enable that organizations can manage their processes and associated risks versus requirements of each internal and external stakeholder, due to the fact that those models rarely exist in literature. Proposed model consists of three levels - correspondence, coordination and integration and put in place a clear and structured approach to controlling organizational risks. Using sample of 30 Serbian companies the proposed model has been checked empirically to contextual independence of proposed model using Mann-Whitney U*test and it has been proved that model is context free and applicable to companies different in size since there were no differences between micro & small vs. medium & large companies. Limitation of this research for sure is the sample size, so its extension is recommended. Further recommendation for future research is also a more detailed analysis on collected data done by using more sophisticated statistical analysis tools, such as regression analysis, structural equations modeling and similar to see interrelations between variables in the proposed model.

Primena novog integrisanog modela za upravlajnje rizikom - poređenje proizvodnih i uslužnih preduzeća

Till now a framework to define a common and unified standard model for integrated risk management systems, which is suitable to be used in all contingency factors settings, has not been found. For this reason, as the main objective of applying the standards of management systems in the organizations is to determine the risk that affects the ability of the organization to achieve its goals and desired results in addition to organizing and coordinating all operations and the optimal use of resources, the purpose is to develop an integrated risk management model for standardized management systems with growing trends such as ISO 9001:2015, ISO 14001:2015, ISO/IEC 27001:2013, ISO 45001:2018 and ISO 22000:2018 with the aim to allow organizations to manage their operations and risks appearing in a manner that reduces the use of available resources and improves the overall performance. Novel risk management integrated model in standardized management systems has three levels - correspondence, coordination and integration and putting in place a clear and structured approach to control of organizational risk. Proposed model has been checked empirically to survey contextual independence of proposed model using Mann-Whitney U*test and it has been proved that the model is context free and applicable to companies from different sectors - both in production and service companies.

Risk management of sociocultural process: digital revolution

Risks and threats play an important role in the development of the sociocultural sphere, while risk management makes it possible to identify and predict them. In this regard, it is relevant, expedient and necessary to undertake an attempt to adapt the economic methodology of risk management to the sociocultural process by means of socio-humanitarian revision of risk management and the formation of an integrated model of sociocultural risk management based on the relevant methodology. Such a model will provide an opportunity for a more detailed approach to the process of assessing and controlling the occurrence of risk, as well as increasing the predictability of potential risk based on the accumulated scientific and practical knowledge and previous experience. The approach to the problem proposed by the author will expand the theoretical and methodological base not only of socio-humanitarian science, but also innovation, general management theory and the risk management methodology itself. The purpose of the paper is to define the specifics and main trends of risk management in relation to the sociocultural process, as well as assess the possibilities of applying this methodology for managing and preventing sociocultural risks. Basing on sociocultural and interdisciplinary approaches, risk management techniques, crisis concepts and the socio-technical landscape of digital reality, an integrated risk management model was formed in relation to the socio-cultural process. It will create an effective mechanism for predicting risk and reducing its impact on the sociocultural process, focused on solving the problems of stabilization and development of objects and processes, and can also be used as a tool in the procedure for making and implementing decisions in strategic planning and project management. Based on the results of this study, a set of main trends in risk management will be formulated in relation to the sociocultural process. The authors of the paper consider the possibilities of using this methodology for managing and preventing sociocultural risks and form an integrated model of risk management in relation to the sociocultural process in the context of a digital revolution.

Source quantification and risk assessment as a foundation for risk management of metals in urban road deposited solids

Urban road build-up solids contain toxic metals posing potential risks to human health. Management of human health risks arising from these metals is critical in urban areas. This study collected solids build-up data from 16 study sites with various land use and traffic characteristics. Source quantification was conducted using PCA/APCS receptor model. It was found that soil and asphalt wear are the largest contributors (69.43%) to risk and mainly contribute Al, Cr, Mn, Fe, Ni, Zn and Pb to build-up solids. Brake wear is the second largest contributor accounting for 17.20% and contributes Cd and Cu. Tyre wear is the third major contributor (11.38%) and it primarily contributes Ni, Zn and Cr. Mathematical equations were fitted to estimate the risk against daily traffic volume and land use fractions, and the uncertainty analysis highlighted that risk assessment should account for the variability in metal concentrations rather than a point value of concentrations at a given time and space. Based on source quantification and risk assessment, an integrated risk management model was developed to manage human health risks from toxic metals in build-up solids. This risk model provides guidance for urban planning and land use development to mitigate risk arising from urban road deposited solids.

Risk Management in Born Globals: the Case of Brazilian Craft Breweries

This work analyzes how risk management occurs in the internationalization process of Brazilian born global companies. Accordingly, we adopted the qualitative research approach, used a multiple case study strategy, and selected seven relevant craft breweries with national prominence. The findings highlight how risks are perceived in the internationalization process by managers and classified among commercial, intercultural, monetary and country risks. We also identified that these enterprises use different actions to mitigate risks, such as planning, market research, and building scenarios. The contributions discussed in this study are the identification of factors such as the international background of managers and the use of networks to minimize the perception of risk. Additionally, we discussed the ways in which risks are perceived and how the different mitigation strategies work. Finally, we proposed an integrated risk management model for the internationalization of born globals.

Formation of a vertically integrated risk management model in a State Corporation

The article considers the approaches for formation of integrated risk management model in the state corporation for the purpose of determining the optimal methodology to choose the decisions on creation of effective corporate risk management system by an example of nuclear industry organizations. The stages of risk management model formation and their results on strategic tactic, operating levels (state corporation — managing division company — production company) have been analyzed.

Модель комплексного управления рисками при обеспечении ресурсо- и энергосбережения процессов на примере сложных теплотехнологических систем

Under the conditions of constantly growing complexity of the processes used in technological systems, the main risk management tasks cannot be solved by using the traditional methods implying exact representation of problem situations. This is because such tasks are characterized by a large number of parameters, uncertainty and data ambiguity. The external environmental conditions for such systems are characterized by instability and uncertainty, which are caused, on the one hand, by high variability of the external environment and, on the other hand, by uniqueness of the emerging problem situations. The problem is formulated, and a cascade-composition integrated risk management model in setting up resource and energy saving processes is proposed taking complex thermal processing systems (CTPS) as an example. The proposed model is based on a fuzzy approach and on fuzzy model hybridization and integration methods. The need for comprehensively managing the risks in setting up resource and energy saving processes in a CTPS is primarily stemming from the requirement of keeping the violation risks within the acceptable level. It should be noted that the acceptable level of risk can be established not only for violation of technological processes in a CTPS as a whole, but also for all stages and for individual technological processes. The proposed cascade-composition model includes fuzzy models for carrying out a component-wise analysis of the technological processes in the CTPS, for estimating the resource and energy efficiency of technological processes, and for assessing the risks in setting up resource and energy savings. The article describes an approach to solving the problem of integrated risk management in setting up resource and energy saving processes in the CTPS using the proposed model. The approach implies specification of different combinations of control parameters at each stage for all technological processes with taking into account all constraints imposed on these processes, and modeling and determining the combinations of control parameters that will make it possible to improve the resource and energy efficiency of technological processes in the CTPS while keeping the violation risks within the acceptable level. The article presents the experimental results of integrated risk management in setting up resource and energy savings using the proposed model and approach taking as an example the process of drying phosphate pellets in the calcining conveyor machine. The obtained results are supposed to be used for integrated risk management in setting up resource and energy saving for various processes in CTPSs.

An experience in integrated management of clinical risks

BackgroundManage clinical risks under the integrated risk management model of the BUPA organization (British United Provident Association). Materials and methodsBUPA is an international group that provides health insurance and healthcare services. The project has been limited to Europe and Latin America (ELA) and this article presents the results related to hospitals.The integral risk management model was based on a governance structure, a risk management framework and the risk management itself (continuous process of identification, evaluation, management, monitoring and reporting).For the latter, a catalog of potential clinical risks was drawn up, using the Joint Commission International (JCI) standards as a reference and applied to a hospital to identify the risk to which they were exposed in their daily activity. An evaluation was conducted, based on its impact and probability of occurrence and depending on the residual and inherent score obtained, the action on each risk and the effectiveness of the controls were determined.A continuous monitoring of the risk profile and the information to share with the Board was defined. ResultsThe catalog consisted of 126 risks and 479 controls, divided by areas of application.In the assessment of the inherent risk, 84% of the risks were at an acceptable and assumable level, and in 16% it was necessary to establish an action plan. ConclusionsUnder the conditions of the study, we believe the benefits of implementing an integrated management of clinical risk system consisted in providing services that meet the legal requirements and standards of good practice (in our case, the JCI's standards). They allowed us to advance in the organization's management of, improving its efficiency in the allocation of resources for risk management and adaptation to the environment and the patient. In addition, this strategy can facilitate decision-making and encourage the organization's transformation capacity.

Integrated Financial and Operational Risk Management of Foreign Exchange Risk, Input Commodity Price Risk and Demand Uncertainty

In this paper, we study the risk management performance of a supply chain which is exposed to foreign exchange risk, commodity price risk and demand uncertainty. We develop an integrated risk management model which uses both financial derivatives and operational methods to hedge the supply chain risks. Findings are discussed for the cases of exchange rate risk with and without hedging.

Exploring critical road project delay factors in Ghana

PurposeThe purpose of this paper is to investigate the causes of road construction delays in Ghana and identify appropriate mitigation measures.Design/methodology/approachThe initial approach involved an empirical analysis of 48 road projects to quantify the extent of time. This was followed by a survey of the perception of road agency and donor partner officials of the critical causes of road project delays.FindingsAbout 70 per cent of road projects experience delays and 52 per cent experience cost overruns. The average time overrun and cost overruns of road projects in Ghana was 17 months and US$1.15m (or 22.5 per cent), respectively. The five most critical causes of road construction delays were delay in finance and payment of completed work by owner (client-related); inadequate contractor experience (contractor-related); changes in scope by the owner during construction (client-related); delay to furnish and deliver the site to the contractor (client-related); and inflexible funding allocation for project items (donor-related).Research limitations/implicationsThe most critical constraint of this study is the fact that findings are based on only the views of industry professional experts. It may be assumed that despite using broadly used terminology to refer to the causes of project delays, the interpretations by respondents may have differed from those intended. Further research could look at the correlation between time overrun and cost overrun using principle component analysis.Practical implicationsThe identified delay factors are not unique to the road sector. From both academic and practical perspectives, the results emphasizes on the need for a holistic and integrated risk management model for the entire construction industry in Ghana.Originality/valueThe paper examined the causes of road project delays in the Ghanaian context and recommended remedial measures.

Integrated work safety of public transport drivers

ABSTRACTThe concept of integrated safety is most often promoted in areas which are crucial to the functioning of the economy and in which human and technological failure are not acceptable and may have major negative consequences for the environment. The idea of a comprehensive understanding of safety is a matter of concern to large manufacturing organisations as well as of all areas of human activities which occur in a particular space and use different technologies. The integrated risk management model is applicable to all areas of human activities. This article discusses its use in assessing risks at public transport driver's work.

Flood Catastrophe Model for Designing Optimal Flood Insurance Program: Estimating Location-Specific Premiums in the Netherlands.

As flood risks grow worldwide, a well-designed insurance program engaging various stakeholders becomes a vital instrument in flood risk management. The main challenge concerns the applicability of standard approaches for calculating insurance premiums of rare catastrophic losses. This article focuses on the design of a flood-loss-sharing program involving private insurance based on location-specific exposures. The analysis is guided by a developed integrated catastrophe risk management (ICRM) model consisting of a GIS-based flood model and a stochastic optimization procedure with respect to location-specific risk exposures. To achieve the stability and robustness of the program towards floods with various recurrences, the ICRM uses stochastic optimization procedure, which relies on quantile-related risk functions of a systemic insolvency involving overpayments and underpayments of the stakeholders. Two alternative ways of calculating insurance premiums are compared: the robust derived with the ICRM and the traditional average annual loss approach. The applicability of the proposed model is illustrated in a case study of a Rotterdam area outside the main flood protection system in the Netherlands. Our numerical experiments demonstrate essential advantages of the robust premiums, namely, that they: (1) guarantee the program's solvency under all relevant flood scenarios rather than one average event; (2) establish a tradeoff between the security of the program and the welfare of locations; and (3) decrease the need for other risk transfer and risk reduction measures.

Integrated risk management for defined benefit pensions: models and metrics

AbstractThe Pension Benefit Guaranty Corporation (PBGC) insures private sector defined benefit (DB) pension plans, when an employer becomes insolvent and is unable to pay the pension liabilities. In principle, the insurance premiums collected by PBGC should be sufficient to cover potential losses; this would ensure that PBGC could pay the insured benefits of terminated pension plan without additional external funding (e.g., from taxpayers). Therefore, the risk exposure of the PBGC from insuring DB pension plans arises from the probability of the employer insolvencies; and the terminating plans’ funding status (the excess of the value of the insured plan liabilities over the plan assets). Here we explore only the second component, namely the impact of plan underfunding for the operation of the PBGC. When a DB plan is fully funded, the PBGC's risk exposure for an ongoing plan is low even if the plan sponsor becomes insolvent. Thus the questions most pertinent to the PBGC are: what key risk factors can produce underfunding in a DB plan, and how can these risk factors be quantified? We discuss the key risk factors that produce DB pension underfunding, namely, investment risk and liability risk. These are interrelated and must be considered simultaneously in order to quantify the risk exposure of a DB pension plan. We propose that an integrated risk management model (an Integrated Asset/Liability Model) can help better understand DB pension plan funding risk. We also examine the Pension Insurance Modeling System developed by the PBGC in terms of its own use of some of the building blocks of an integrated risk management model.

Integrated supply chain risk management via operational methods and financial instruments

Supply chain risk management (SCRM) is an emerging field that generally lacks integrative approaches across different disciplines. This study contributes to narrowing this gap by developing an integrated approach to SCRM using operational methods and financial instruments. We study a supply chain composed of an aluminium can supplier, a brewery and a distributor. The supply chain is exposed to aluminium price fluctuation and beer demand uncertainty. A stochastic optimisation model is developed for managing operational and financial risks along the supply chain. Using this model as a base, we compare the performance of an integrated risk management model (under which operational and financial risk management decisions are made simultaneously) to a sequential model (under which the financial risk management decisions are made after the operational risk management decisions are finalised). Through simulation-based optimisation and using experimental designs and statistical analyses, we analyse the performance of the two models in minimising the expected total opportunity cost of the supply chain. We examine the supply chain performance as a function of three factors, each at three levels: risk aversion, demand variability and aluminium price volatility. We find that the integrated model outperforms the sequential model in most but not in all cases. Furthermore, while the results indicate that the supply chain improves its performance by being less risk averse, there exists a threshold beyond which accepting a higher risk level is not justified. Managerial insights are provided for various business scenarios experimented with.