Dyman & Associates Risk Management Projects, What are you willing to pay?
by Jerry Breacker Dyman & Associates Risk Management ProjectsWinter
weather has taken its toll on both sides the US and Canadian border. One utility that has taken it in the chops
from all the ice and snow has been electric companies
that provide services to businesses and individuals. Now this wasn't the only time that there have
been electrical outages due to severe weather.
Power outages have become rather routine when severe weather hits. The question is, "How much mitigation do
you want to invest in to reduce the impact of outages?"
The above is
the theme from a Toronto Glob editorial, see the ice storm: Why you want the
lights to go out, sometimes in the piece they call attention to the fact that
you can't mitigate every risk. The costs
to do so would be too high. Thus, the focus
on risk management.
"What
is risk? It is the odds of suffering a loss in the future. It is a
cost. And what about the reduction or elimination of that risk? Also a cost. In
deciding whether to pay the price, utilities – and all of us – end up having to
weigh three factors: the size of the possible damage, the likelihood of its
occurrence, and the price of mitigation."
Risk
management will become a greater part of
the discussion as we move forward and the warming climate starts to impact our
communities in varying ways. This will
be a good discussion for communities to have.
One way to reduce risk is to disperse it in the entire community (whole
community). If individuals are better
prepared than the costs for organizations can be lessened, and costs of single
entity preparedness reduced.
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Created on Dec 31st 1969 18:00. Viewed 0 times.