Consequence of Failure

The next step in determining a criticality score is determining the consequences of an asset failing. Consequences of failure include criteria set using the financial, environmental, and social impacts a utility and community experience when an asset fails under any failure mode. These impacts can be valued differently by giving more weight to one type of consequence than another. These three categories are frequently referred to as the Triple Bottom Line. There are multiple tangible and intangible factors that influence the consequences of an asset failing. These consequences can range from impacts on public safety to environmental contamination to costs related to collateral damage caused by the failure.  

To calculate the overall criticality score of an asset, the consequence(s) of failure needs to be quantified. Like the probability of failure rating, each asset should be assigned a consequence of failure (CoF) rating based on the severity of any financial, environmental, and social consequences caused by that asset failure. Also, a consequence of failure rating structure should be developed and implemented. Each consequence rating should have a general degree of impact description. It is important to create a consistent rating structure so that different staff members are likely to rate the consequences of failure of an asset similarly. 

A consequence of failure rating is essential to calculating a criticality score. The consequence of failure rating is multiplied with the probability of failure rating to get an overall risk score of each asset. The reason for considering both probability and consequence of assets is that neither one taken by itself is likely to result in the best expenditure of funds.  

Consider the following example: 

 Both Assets A and B have moderate probability of failure scores; however, Asset B has a higher consequence of failure score. The criticality score indicates that repair or replacement of Asset B may need to be prioritized. 

Conversely: 

If both assets A and B have moderate consequences of failure, but Asset A has a higher probability of failure, the criticality score indicates that repair or replacement of Asset A may need to be prioritized. 

The two ratings together help identify which assets may need priority attention to ensure that assets remain functioning at the desired level.