Components of Risk

Risk is an expression of potential loss stated in terms of hazard exposure, severity, and probability.

Exposure:

Amount of time, number of events, how many people involved, how much equipment involved, or the amount of activity during which mishap exposure exists. The mission you perform is the basis for measuring exposure. It identifies generally how many people will be exposed to what hazards for how long. This data is critical to the risk assessment process.

Severity:

What is the likely result of each event -injury, damage, or death? The database is the key here. It can tell the distribution of hazard events by severity for personal injury, occupational illness, property damage, or equipment damage that could ultimately occur.

Probability:

Probability is the likelihood that, given an exposure to a hazard, an accident will result.

Question: As a manager, which of the three components should concern you the most?

We will delve into this in our next article.

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