Risk Management Module 5 Summary

The Fundamentals of Asset Integrity Management
Online Training Series Course Summary
COURSE B: THE FUNDAMENTALS OF ASSET INTEGRITY RISK

MANAGEMENT
Module 5: Monitoring and review
Demands for performance monitoring and auditing

There are a number of potential drivers with respect to performance auditing and monitoring:
Legislative Requirements - set standards to be achieved (Local Laws, General
Environmental and Social Responsibility)
Stakeholder Expectations - Internal certifications, Client requirements, investor pressures
Internal needs such as increased business scope, risk reduction, financial savings and
accidents/incidents
Integrity monitoring should be based on facts.
Key Performance Indicators

There are 2 types of indicators used by the Industry:
1. Lagging Indicators - which tend to be based on incidents that have already occurred. But
industry tends to measure lagging indicators such as LTI (Loss Time Injuries) and so on. A
Lagging Indicator is the number of unexpected loss of containment incidents due to
failure of flexi hoses, couplings, pumps, valves, flanges, fixed pipes, bulk tanks or
instrumentation.
2. Leading Indicators which are more proactive and tend to measure things before they
occur. This is the percentage of safety critical plant/equipment that performs to
specification when inspected or tested. The percentage of maintenance actions
identified which are completed to specific timescale.
The UK HSG254 suggests Key Performance Indicators (KPI) in 4 key areas:

1. Maintenance and Mechanical Integrity
2. Action Item Follow-up
3. Management of Change
4. Process Safety Training including Competence and Assurance
"You don't improve what you don't measure"
As an Asset owner, you should know the following:

What your risks are,
That you've established suitable levels of controls,
Understand what these controls have to do, and
Ensure that you are proactively measuring whether or not these controls do what you
expect them to do.
Safety Critical Equipment (SCE) Performance Management

This is a management system that an asset manager needs to have to measure the risk in
performance. This goes back to the idea of what controls you have, what these controls do and
Course summary developed by Michelle McIntyre on behalf of Oil and Gas Fundamentals Oil and Gas Fundamentals 2012
THIS IS A CONFIDENTIAL SUMMARY OF THE CONTENTS OF AN ONLINE TRAINING COURSE FOUND AT WWW.OILANDGASFUNDAMENTALS.COM.
IT IS FOR THE REVIEW OF COURSE PARTICIPANTS ONLY AND IS NOT FOR DISSEMINATION COPYRIGHT RESTRICTIONS APPLY
are these controls doing what they have to do.

Using maintenance, test, inspection & failure histories to identify whether risk control
element or systems have
passed performance criteria
been maintained, tested etc. at required frequency
Risk control element and system pass/ failure reviewed at regular Integrity Management
meetings
Decision on whether to add additional safeguards, suspend or moderate operations in
light of deviations
Integrity KPI Scorecard - shows the sore of your performance management system and if the
controls are doing what it has to do.
OIM monthly status report - has performance standards and the status of them - it assists the
asset manager to manage their assets and measure the controls.
Key Performance Indicators across the business

There are 3 types of level indicators:
1. Organization Level Indicators - these type of level indicators are normally generic and
reflect common process safety system elements in place at all the company facilities (be
it nationwide/worldwide)
2. Site Level Indicators - these indicators should reflect the major hazard scenarios
relevant to each site and show the condition of the RCS in place at the site to prevent
major accident hazards
3. Installation/Plant or Facility Level Indicators
At the end of the day, what is being said here basically is that Management must understand
and appreciate the role of Risk Management with the context of Asset Integrity.
Verification scheme
To allow us to ensure that our equipment is working, we must have some form of verification
scheme.
A Verification Scheme is:
a written process implemented to confirm, or otherwise, that Critical Risk Control
Systems are suitable and remain in good repair and condition
the process used to manage the Critical Risk Control Systems assurance during the
asset lifetime
Elements of Verification Scheme

Companys Competency Management system ensures that assurance and verification
activities are carried out by competent people (Suitably Qualified Experienced
Personnel - SQEP)
Verification activities often carried out by an Independent Competent Person (ICP) -
normally an asset owner drives this and encourages this action, an owner must take it
upon himself to verify all that activities with highest integrity.
ICP must be sufficiently independent so as to be impartial and objective in their
judgment such that safety is not compromised.
Arrangements for reviewing and revising the scheme

Periodic Review of processes.
Periodic review of maintenance history.
Maintenance, inspection and testing, details:
Critical Risk Control Systems register - to establish the key controls that are relied
on
Maintenance Planning and scheduling tool - recording and dealing with
deficiencies and using this information to schedule and plan maintenance activities
Maintenance procedures
Records are kept of these activities and any findings:
Maintenance Logs
Defect Logs
Calibration records
Deficiencies are dealt with:
Defect Log and review
Action tracking systems
Change Management process
Verification tasks are often carried out by an Independent Competent Person.

Example Verification Tasks which by the way are mainly carried out during design phases:
Study reviews
Audit of testing and inspection records
Witness testing
Verification tasks is used in the design phase to provide an independent view point that the
inspection and testing is actually being done, to make checks on it and to witness testing on it
as well in a suitable and sufficient manner and that barriers have worked when they were
expected to work.
At a Company level, verification tasks lead to an Audit which is a process used to determine
whether asset integrity management system is performing effectively and identify areas for
improvement. Auditing is a key part of an HSE Management System and Asset Integrity
Management System. Basic rules have to be established such as:
How often is an audit conducted?
What so we need to audit?
Asset risk profile determines audit type and frequency
Exactly how these audits are to be done?
May be internal and/or external?
Requires competent auditors and objective protocols
Recommendations for improvement should be followed up
Evidence submitted for management review
To determine whether asset integrity management system is performing effectively and
identify areas for improvement
Management review
Look for possible improvement opportunities in asset integrity
Evidence from audits should be submitted to management for review.

Lessons learned from incident and near misses company and others
Benchmarking against industry best practice and case studies
Set suitable objectives for next improvement cycle
Risk-based allocation of resources to asset integrity monitoring and improvements
So if we don't know where our key risks are, then we won't be able to make sure that we're
managing them properly.
Leadership, culture and human behavior the new frontier

Management team decisions influences and creates the environment that surrounds the
employees. Not only the physical environment but the social mental environment that is going
to influence and be reflected by the culture of a particular operation.
Technical standards and operating procedures were put in place to influence the culture
and behaviors, but these were not enough.
So management of these systems needed to be improved, so ISO systems were put in
place.
It is believed that the next area of improvement is to improve leadership, cultures and
behaviors. What gets done on a particular site is what needs to be done to be able to
manage assets effectively.
Process safety cultural ladder

To assist in encouraging and creating a better environment, we must understand the steps
from the bottom upwards on the cultural ladder.
Moving up the cultural ladder requires acceptance that there are more advanced cultures than your own. From the
bottom of the culture ladder go up, one is increasingly informed and trust is increasing.
1. Pathological - this is where the attitude of management is that of "who cares about safety, as long as we don't get
caught" - their main ideas are such like sacking the idiot who caused the accident and not investigating how the
accident really happened and how to improve.
2. Reactive - Safety is important in this step of the cultural ladder, but they only do a lot when an accident happens.
Safety is normally high on the agenda after an accident, but not enough is done to encourage safe actions
throughout the day.
3. Calculative - systems are in place to manage all hazards. Many audits are done and HSE advisors benchmark their
performance a lot and chase statistics.
4. Proactive - management basic behavior is working to identify the problems that may still and do exist in their
systems. Management is open-minded but still obsessed by statistics and still not enough on generation and
measuring of their own information and performance measurement.
5. Generative - HSE is fully integrated into the company's business and continues to strive for continuous
improvement. Safety is seen as a profit center and new ideas are welcomed.
A new way of thinking about process safety leadership

Starts with safety leadership and establishing systems and behaviors. Ensuring that employees understand that:
Safety is a personal value
Focus on what is missing (and involve people in the solution) not on what is wrong (blaming people)
Keep the message simple and on what is or isnt working (avoid blame and justification)
There is a transition process From climate to culture. It starts at the top because management has to walk the talk and it
has to be stuck to and followed through.
Leaders steer and create the climate through leadership practices
When leadership practices are effective they create employee engagement
Culture is an outcome of any different factors interacting over time
Leaders create the right climate for the culture to develop
There is a cause and effect relationship between leadership practices, employee motivation and effort, and
business performance
Module 5 - Key learning points

1. What gets measured gets done
2. Verification of performance standards gives assurance that Critical Risk Control Systems are suitable and remain in
good repair and condition
3. Audit checks whether what is required to be done is being done
4. Management review assess the overall effectiveness of the asset integrity management system
5. It is increasingly important to focus on organizational processes and culture to prevent major accidents in complex
industries
6. Culture is an outcome of the climate created by executive decisions and leadership practice

Risk Management Module 5 Summary

Uploaded by

Document Information

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

Risk Management Module 5 Summary

Uploaded by

Copyright:

Available Formats

The Fundamentals of Asset Integrity Management

Online Training Series Course Summary

COURSE B: THE FUNDAMENTALS OF ASSET INTEGRITY RISK

Module 5: Monitoring and review

Demands for performance monitoring and auditing

Key Performance Indicators

The UK HSG254 suggests Key Performance Indicators (KPI) in 4 key areas:

"You don't improve what you don't measure"

As an Asset owner, you should know the following:

Safety Critical Equipment (SCE) Performance Management

are these controls doing what they have to do.

Key Performance Indicators across the business

Elements of Verification Scheme

Arrangements for reviewing and revising the scheme

Verification tasks are often carried out by an Independent Competent Person.

Evidence from audits should be submitted to management for review.

Leadership, culture and human behavior the new frontier

Process safety cultural ladder

A new way of thinking about process safety leadership

Module 5 - Key learning points

You might also like