Risk-Based Decision Making

It is important to understand how the concept of risk can inform decision-making in terms of interventions during the asset’s life, including how to operate, maintain, repair, rehabilitate and replace the assets. Risk-based decision making is about expending more of the resources, both personnel and finances, on the higher risk assets and fewer resources on the lower risk assets. 

High-risk Assets 

For assets in the high-risk category, the consequence of failure might be so great that it is ill-advised to allow the asset to fail. Because high-risk assets are both likely to cause consequences and likely to fail, it is important for the system to take action to prevent failure. For each asset in this category, determining what action(s) can prevent failure is of utmost importance. Actions that can prevent failure include: 

• Preventive maintenance can ensure that the utility can get the maximum amount of use out of the asset. 

• Asset rehabilitation supports level of service by renewing an asset to almost new condition without the expense of full replacement. 

• Asset replacement is an option when replacing an asset before it fails can prevent negative consequences. 

Moderate-risk Assets 

For those assets in the moderate risk category, there are three possibilities:  

• Assets that are likely to fail but have low consequences can often run to failure and usually only require minimal maintenance. 

• Assets that are unlikely to fail but would cause high consequences are ideal for additional monitoring to determine if the condition is worsening or the likelihood of failure is increasing. Routine maintenance can help with monitoring these assets. 

• Assets that have a moderate probability of failure and a moderate consequence of failure should receive routine and preventative maintenance to try to prevent failure and reduce potential consequences. 

Low-risk Assets 

Assets in the low-risk category are not likely to fail, and if they do, they are unlikely to cause significant consequences. These assets require the minimum maintenance necessary to prevent the asset from increasing its probability of failure. No extra work should be done, as work in this portion of the risk profile will not change the risk profile. Work in all other areas of the risk profile can change the risk profile, but not this portion. Therefore, expenditure in this area is kept to a minimum.