APPENDIX C

Gap Assessment

Contents

Introduction and Background

Key Needs to Build and Sustain a Risk Management Program

Key Challenges

Key Knowledge Gaps

Next Steps

Introduction and Background

The objective of NCHRP Project 08-151 was to develop content on how to implement and sustain the use of formal risk management at state DOTs. The research described within this report focuses on assessing the gaps identified through the project practitioner survey and the focused literature that exists to achieve the goal of formalized risk management. The research team used information included in this summary to shape discussion topics that were included in the industry roundtable in Task 4 and throughout the research.

Through the practitioner survey and the focused literature review, the team concentrated their efforts on identifying a baseline understanding of practices implemented to assist in building momentum and sustaining risk management practices within organizations or agencies, with a focus on organizational traits and change management strategies needed to overcome barriers to implementing and sustaining formal risk management. The team organized information into the following categories in both the practitioner survey and the focused literature review to assist in highlighting the remaining gaps in knowledge or resources that agencies have identified as necessary to build and sustain their risk management programs:

Value Proposition: What is the value of risk management to a DOT? How is it understood, summarized, explained, and measured within a DOT?

Quantification of Risk: How do agencies quantify risk and how can it be done throughout the agency? What is the impact?

Organizational Change: How have agencies successfully managed major change initiatives? Is it top-down or bottom-up? What was done to prepare the agency for change?

Data and Tools: What are the risk management tools and data agencies use to help in their risk assessments? How can the data be shared across divisional lines—up and down?

Culture of Risk: What is the tolerance for risk within the agency? How do agencies create a culture that accepts certain failures?

Integration with Existing Processes: What are acceptable methods of considering risk as part of planning, programming, environmental review, asset management, transportation system management & operations, and other existing processes? What concerns do agencies have about ensuring consistency with federal requirements?

Communication and Promotion: What types of communication or promotional material have been used to help educate agencies internally? How do transportation agencies create change agents within their organization to ensure risk management is a key pillar?

Key Needs to Build and Sustain a Risk Management Program

Within the Value Proposition, Organizational Change, and Communication and Promotion categories of the efforts in Task 2 and 3, these key needs to build and sustain a risk management program were noted, where need is defined as a required component to achieve optimal risk management adoption:

• Risk management champion and executive leadership support.
• Clear policies that adopt risk management into strategic planning and performance management processes.

• Communication strategy for how to incorporate risk management within agencies, including basic principles and terminology of risk management.

Most respondents to the practitioner survey and findings from the focused literature review noted that building and sustaining a risk management program within a state DOT requires executive leadership and a consistent risk management champion. In addition, it was noted that having clear policies that require the use of risk management practices in strategic planning and applicable management processes is valuable to propel staff to integrate risk management into their existing processes.

Communication strategies and the promotion of risk management programs are essential to integrate risk into business practices. Communication strategies are coupled with needs identified for executives and leadership. Without leadership buy-in and a clear communication strategy, agencies find it challenging to increase awareness, trigger action by decision-makers, and reduce their chances of acquiring required investments to reduce risks and improve performance.

The focused literature review also found that organizations are more likely to adopt strategies that are used by their peers; in other words, risk management implementation gains momentum when the knowledge of implementation successes spreads to others within the industry with improved communication of success stories.

Considerations for Industry Roundtable

The research team considered the following questions for the industry roundtable:

• Is the need for risk management champions an unmet one that requires additional resources, which can be developed in Phase II of this study, or is the need well-known and simply requires additional education and outreach to executives to fill it?
• Does the transportation industry have adequate communication tools for risk management practices?
• Are there similar policies within the transportation industry, or similar industries, that may help solidify risk management practices within DOTs?

Potential avenues to pursue in the industry roundtable could include the following:

• Development of materials for the AASHTO Leadership Institute.
• Engagement of executives and leadership to describe their experiences with risk management integration within their agencies.
• Development of testimonial videos from peer executives and leadership with successfully maintained risk management programs.
• Documented case studies of implemented risk management programs in two-page fliers.
• Example policies adopted by peer agencies.
• Development of executive training opportunities on the benefits of risk management at annual AASHTO or TRB meetings.
• Development of online training materials aimed at executives and leadership to provide knowledge of risk management practices with state DOTs and example peer experiences.
• Development of templates for agencies to communicate their risk management efforts and successes.

The research team developed discussion questions and example/draft materials for consideration by the industry roundtable to improve the key needs to build and sustain a risk management program at a state DOT.

• Access to educated well-trained staff on the principles and application of risk management within a state DOT.
• Simple online databases, dashboards, and risk procedures for internal agency staff to easily understand how risk is being used at agencies.

Of note, of these identified key knowledge gaps are the repeated selection of lack of data/tools, measurement methods/metrics, and staff competence as one of the top three needs to build and sustain a risk management program in the industry survey conducted in Task 2. It was also noted by survey participants that a gap exists to support professionals in the calculation of risk to improve visualization of their findings and incorporate quantified risk into project scoring and benefit-cost assessments. Also noted as a gap is the lack of established numeric goals for risk performance. Twenty-five of the 44 survey participants (56%) noted the need for risk visualization tools to help tell the story of their assessments. When quantifying risks, documentation often cited the desire to keep it simple and scalable rather than complex. There is a desire to “strike the right balance” between quantifying and managing risk with limited resources.

Considerations for Industry Roundtable

When considering how to address these identified key knowledge gaps in building and sustaining a risk management program at a state DOT during the Task 4 industry roundtable, one must consider the following:

• What readily available risk quantification tools and methods are available to practitioners? What research may be underway for future tools, methods, models, or metrics? What information or data is currently available to DOTs that could reflect risk, such as percentage of assets operating in poor condition?
• Are there examples from other critical infrastructure sectors or within the transportation sector to support (1) the need for quantitative risk methods, models, or metrics and (2) how to portray/visualize/communicate such information?
• What training is available to staff? Is it being utilized? Does our industry have adequate easily obtainable training on the topic of risk management that applies to a range of duties/processes?
• What is the available time in staff schedules to gain the necessary training?
• Are staff being asked to perform assessments that the industry has not developed easily implementable procedures for?

When considering the identification of tools to address these knowledge gaps in Phase II, potential avenues to pursue with the industry roundtable in Task 4 could include the following:

• Documentation of any existing quantitative models to support such assessments, including providing example applications, if possible, with a focus on models that are simple and have the potential to be replicated elsewhere. Note: The research team included example models, applicability, and level of complexity to implement them to the roundtable members to expedite this discussion topic.
• Case studies documenting the use of quantitative methods, models, and metrics to portray the risk profile of a particular process of state DOTs.
• Development of templates to assist agencies in applying quantitative methods, if applicable.
• Development of educational materials for undergraduate educational programs to introduce risk management processes within relevant courses (e.g., highway safety courses, engineering economics courses, GIS courses, performance management courses, planning courses).
  • – These materials could include example datasets, maps, and reporting requirements to introduce students to this “soft” side of engineering.
  • – Worked examples of small-scale portions of a system.

• Consider the value of certification for risk management in transportation.
  • – Road Safety Professional Certification (Institute of Transportation Engineers).
  • – Professional Traffic Operations Engineer (Institute of Transportation Engineers).
  • – GIS Professional Certification (GIS Certification Institute).
  • – Undergraduate Certificate in Security and Resilience in the Transportation Sector (Sam Houston State University).
• Educational contests: The AJE30 Committee has resurrected an Asset Management Competition. Could risk be added as a component?
• Development of training opportunities on the benefits and lessons learned of risk management at annual AASHTO and TRB meetings and local ITE Chapter meetings that allow for easy roundtable discussions.
• Development of online training materials aimed at staff required to integrate risk management into their daily processes/responsibilities, potentially accredited to support required continuing education credits.

Next Steps

These gaps framed the industry roundtable discussion and the resource development in Phase II. The team’s next steps were to develop the industry roundtable discussion topics and exercises for Task 4.