EPMS
Event Risk Management
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List of Tables and Figures |
Sample of Environment Risk checklist
Alcohol Policy -a study of the New Millennium celebrations at Darling Harbour, Sydney
1. Risks are Integral to Special Events
"You can not step twice into the same river" Heraclitus 6th Century BC
In a time of change there is a risk in staying exactly the same. One only has to consider the state of many computer companies to see the risk involved in modern corporate life. The great advantage of the event industry is that risk is an integral part of it. If there is one industry that is used to the roller coaster ride it is the event industry. Ticketed events, such as concerts, depend for their income on the financial risk involved in promoting events. This risk keeps the number of competitors in the industry to a minimum. Sporting events such as the Xtreme games depend on an element of danger as their attraction. This very fact results in an industry that is very careful when it comes to risk. If an event manager is risking a large sum of money on the success of a concert, then in just about every other area of the event the risk has to be determinedly reduced to a minimum.
In particular one off events are, by their very nature, a high risk. If anything is special it is out of the ordinary and people are used to responding to the ordinary. With the changes that are happening in the general business environment such as deregulation, globalization and the pervasive growth of information technology, a detailed plan for a special event can be out of date long before the special event actually occurs. The measurable objectives, so carefully thought out, can quickly become constraints and strangle the creativity so needed in a changing environment. When the Australian dollar suddenly dropped in value against the US dollar in 1998, many festivals had to completely rethink their programs as they could no longer afford the major performing acts from overseas.
What is risk? It is the measure of the probability and consequence of not achieving a defined event project goal. Ideally it can be expressed mathematically. However whether that is practically possible is a risk itself.
2 Special Circumstance of Events
In the event field as in so many project based industries the identification and management of risks is a high priority for management. There are special circumstances at events that add to the importance of risk management such as
The lack of time to make well considered choices as the event approaches combines with the cost of making any changes, leads to a high risk period just prior to the start of an event.
When combined the above points provide a very good reason to identify and control as many problems as possible.
The Australian Standard's definition of a risk management is:
Risk Management is the term applied to a logical and systematic method of establishing the context, identifying, analyzing, evaluating, treating, monitoring and communicating risks associated with any activity, function or process in a way that will enable organizations to minimize losses and maximize opportunities. Risk Management is as much about identifying opportunities as avoiding or mitigating losses.
The stress on identifying opportunities is important to event management as many risks can be a stimulus for the creative process.
At a recent event I organised with the local Arts Council in the remote Warrumbungles area of Australia, it poured with rain, hailed and all the rivers flooded. It was an out door event. I made the decision to change it to the local (covered and very large) sports arena. During the day at the venue, the local artists painted a picture of the magnificent mountain range so that the audience would at least feel that they were in these volcanic mountains. Here was an opportunity to raise money for a local charity. We decided to auction the painting and raised $1500. A risk was turned into an opportunity.
Part of the knowledge gained by event experience is the ability to identify risks. It would then make sense to ask those people with the most experience. In many cases this is the subcontractors and suppliers. Although the event may take a year to plan and be over in a day, the suppliers are continually working at various events and their knowledge is invaluable to the event manager.
Other methods of identifying risk are:
Brainstorming is a common method of identifying risk. The brainstorming meeting can apply itself to the whole event or to particular sections.
The use of test events, event modelling and 'event incubating' are methods for risk identification. The Olympic Organising Committee carries out a detailed schedule of smaller events that test aspects of their overall plan. As yet there is little computer modelling of events. However, simple financial scenarios, using spreadsheets and project management software, are used as a method of risk identification. On a larger, more scientific scale, events can be 'incubated' in a controlled environment or on a small scale and the finished plan used as the basis of a larger event or franchised to other regions.
5. Tools to identifying risks
The remaider of this material is available on the EPMS CDROM
Cause to effect :
Effect to cause ;
Lack of attendance at a one day Wine and Food Festival
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Promotion |
Theme/content |
Operations/Staging |
Environmental |
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Negative publicity |
Unsuitable suppliers |
No parking/transport |
Bad weather |
An outcome of the risk analysis process may be an integrated plan of action in response to a major problem. The plan would contain responsibilities, chain of command and procedures to minimise or contain the impact. In Project Risk Management, Chapman and Ward distinguish the base plan, how the project should proceed, from the second level plan or contingency plan containing the response to threats or opportunities.
Recommended Reading ( required reading!)
Safe and Healthy Mass Gatherings Manual 2 Part 3 of the Australian Emergency Manual Series.Commonwealth of Australia 1999 available from www.ema.gov.au - excellent checklists - essential reading. All their series are well written, (cost around $5) and straight to the point.
Emergency Risk Management- Applications Guide Commonwealth of Australia 1999 available from www.ema.gov.au.
Copyright W.J. O'Toole 2006