Implementation of a Risk Management Program to Address Public Policy Issues in Mega Projects

Discussing risk raises a variety of questions. What is risk? Why have so many types of risk developed? How are the quantitative modeling aspects of risk used to communicate risk information as well as the opinions and judgments of the evaluators? In the end, the more fundamental question is why do we perform risk analysis at all? As an advanced economy and developed nation, the US has addressed risk in many areas, primarily in insurance and more recently in the financial industry. Now the concept of risk is being extended into physical infrastructure projects and transportation in particular. Clearly this extension is due to the complexity of today’s megaprojects. These projects are planned and built based on enormous quantities of data and information. The reality that not all data is of the same quality and often the planning is insufficient. What is driving this? What are the expectations of the stakeholders? After all, they are allocating resources into this effort with some expectation of a return. The value received from performing a risk analysis offers advantages over proceeding blindly thru the fog without the benefit of a “risk radar.” Why spend the effort to analyze past experience and apply these lessons learned in a systemic manner to the current project? Is this something that we do intuitively? Is another engineering management discipline needed that will invariably lead to more work?