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The Importance of Risk-Based Thinking

Written by Charles Nelson - December 11, 2019

Risk shadows your every step whether you think about it or not. Anyone can sue you, at anytime, for anything. However, the greatest risk of all is not taking any risk. The secret is: become a low-risk practice to give you the competitive advantage you need.

How shall I go about this, you ask? Largely by establishing a keen appreciation of risk issues and persistently following design processes. This will lessen the severity of risks if they occur, and even limit the likelihood of their occurrence.

Thus, a sequence of risks that would inflict serious damage on unprepared practices would have no lasting impact on well-prepared, low-risk practices.

One of the key changes in the international quality standard ISO 9001:2015 from the previous 2008 version is that there is a new requirement to include “risk-based thinking” and risk analysis.

Therefore, it is imperative that design professionals acquire risk-based thinking as well as conduct a formal risk management assessment. This should be completed, at minimum, at three intervals in the project delivery process.

Visit https://buildingtech.com/designrisk/ to learn about the DesignRisk App, which can be used as the basis for significantly lowering your practice risk – that is, the likelihood that claims will be made against you.

Why use DesignRisk?

Risk is simultaneously unique and common. Because almost every project is unique, every project has a huge number of risks – mostly minor, but often major. Virtually every aspect of the design process carries some risk. Stakeholders in design risk are the design firm, the client, users of the project, and the public.

DesignRisk covers five of the most common areas of design practice risk: Client risk, Approvals risk, Site risk, Design risk and Construction risk. There are 6 to 14 Risk Categories in each of these areas.

All of these risk areas have the potential to affect the design firm, and many of them also pose risks for other stakeholders. The firm’s prior experience is probably the most important factor in being able to reduce the severity of risk situations – but there are many other measures the design firm can take to reduce the probability of the risk occurring.

The DesignRisk App:

  • Greatly simplifies and speeds up creation of a Design Risk Management Plan;
  • Identifies risk areas that many less-experienced practitioners might miss;
  • Takes the guesswork out of assigning values for risk probability and severity;
  • Is completely scalable – fits any size project;
  • Allows users to select only the risk areas relevant to the project;
  • Exports a PDF or Excel file that can be further tailored to suit the project; and
  • Runs on a PC, Mac or iPad (and even your iPhone).

What next?

Refer to Chapter 8.8 of Managing Quality in Architecture, 2nd Edition, to learn about the five steps to avoid project surprises. You can order my new book from any good online bookstore. Book Depository offers a good discount as well as free shipping worldwide. To learn more, check out https://mqia.com/.

Head to https://www.designnode.net/knowledge-to-forge-your-future/#risk to browse multiple articles on the topic of risk, including risk response & loss of relevance, how to become a low-risk practice and risk management 101.

To find out about how ISO:9001 and Risk Management interrelate, go to https://mqia.com/quality-standards/iso-9001-risk-management/.

Charles Nelson AIA, LFRAIA, AECPM

December 11, 2018