ABSTRACT
Risk and uncertainty are unavoidable in shutdown life and it’s dangerous to ignore or deny their impact� Adopting a “can do” attitude may be a good way to get your team members energized and committed, but it’s a foolhardy approach when it comes to managing a complex shutdown�
Risk analysis is conducted so that a shutdown team can accurately predict the shutdown completion date� It is based on a task-by-task analysis� We discovered that we can identify each task’s expected duration that will be good most of the time-over 50% of the time if the task were repeated over and over� And, we can identify the likely worst case overrun for each task� We discovered a way to use this information to average out task overruns to create a shutdown time buffer� We create a time buffer for the Gantt chart to protect our completion date estimate from the tasks that overrun most of their time forecast�
The uncertainty in undertaking a shutdown comes from many sources and often involves many participants in the shutdown� As each participant tries to minimize its own risk, the conflicts among various participants can be detrimental to the shutdown�
A risk is a possible unplanned event� Because risks are the unpredictable part of the shutdown, it is important for us to be able to control them as much as possible and make them as predictable as possible�
Risk management is the process of identifying, analyzing, and quantifying risks, responding to them with a risk strategy, and then controlling them�
There are usually four steps considered in managing any risk�
1� Risk identification 2� Risk quantification 3� Risk response 4� Risk control
Risk identification is the process of identifying the threats and opportunities that could occur during the life of the shutdown along with their associated uncertainties� The first step in risk management is identifying the risks that we will see in our shutdown� These are the things that threaten to stop us from delivering what we have promised on the schedule we promised for the budget we promised�
The first thing we must do in risk identification is recognize the areas of the shutdown where the risks can occur� This means that we will have to investigate the following areas:
• Scope: We must look at the work of the shutdown� The work breakdown structure (WBS) will be useful here� The shutdown scope must be clearly defined in terms of both the deliverables and the work that must be done to deliver them� Errors and omissions on the part of the shutdown team and the stakeholders must be minimized� As always, the WBS will be very helpful in doing this�
• Time: Estimates for the duration of the shutdown and the duration of the shutdown tasks must be done accurately and reliably� The sequence of work must be identified, and the interrelationships between the tasks must be clearly defined�
• Cost: Estimates for tasks must be done accurately and reliably� All associated costs must be considered and reported accurately�
Life cycle costs should be considered as well as maintenance, warranty, inflation, and any other costs�
• Customer expectations: Estimates of shutdown success must be considered in terms of customer needs and desires� The ability of the shutdown to be scaled up or manufactured in different quantities or for different uses and sizes must also be considered�
• Resources: This involves the quantity, quality, and availability of the resources that will be needed for the shutdown� Skills must be defined in the roles that will be necessary for the shutdown�
The following items can be explored to stimulate discussion and flesh out hidden risks:
• Staffing assumptions: Some important activities may depend on the attendance of essential personnel� Identify people who will be indispensable during the shutdown execution because of their special skills or knowledge� Next, determine whether or not the shutdown can proceed without these people� Also consider the potential for work stoppages or slowdowns�
• Estimate risks: Identify time and cost estimates that were developed with minimal information�
• Procurement problems: Any deliveries expected during the shutdown execution should be reviewed for potential delays or even cancellation� Items from sole-source suppliers represent the highest risk�
• Shutdown files: Review previous shutdown results� Even shutdowns performed in a different area can provide some insight into potential problems�
• Commercial data: Review trade articles for insight into some problems that others have encountered� The American Society of Professional Estimators has published articles on shutdowns and major modifications performed in industry�
• Shutdown team knowledge: Query the shutdown team� Team member recollections of previous shutdowns are useful, although less reliable than documented results�
• Possible weather conditions: Major storms, or just rain and snow, can affect the schedule of a shutdown�
• Nature of the shutdown: Sometimes the magnitude of internal damage is unknown� Corrosion, abrasion, or wear may be higher than expected� A similar risk exists when primary activities of a shutdown are performed for the first time� Application of new technologies or methods falls into this category�
Risk quantification is the process of evaluating the risk as a potential threat or opportunity� We are mainly concerned about two items: risk probability and risk impact� Risk probability tells us the likelihood that the risk will take place, and risk impact is the measure of how much pain or happiness will result if it does take place� Risks that have very high impacts with very low probabilities and risks that have very low impacts with high probabilities are usually of little concern, so we need to consider the combination of these two items before considering how important a risk is� The combination of impact and probability is called severity�
The objective of quantification is to establish a way of arranging the risks in the order of importance� In most shutdowns, there will not be enough time or money to take action against every risk that is identified� Two questions should be asked of the shutdown team for each item on the list: Is the probability that this risk will be encountered high or low? Would an occurrence of the event significantly lengthen the shutdown?
