Risk Management

Risk Management PolicyFrom an early stage Crossrail recognised that managing risk was critical to the success of the programme. Crossrail implemented risk management across the organisation with three core objectives:

  1. Support the delivery of Crossrail by reducing the likelihood and potential consequences of events that could have a negative effect on the programme and increasing the likelihood and potential consequences of events that could have a positive effect on the programme;
  2. Provide assurance to internal and external stakeholders that each project understands its significant risks and is actively managing them;
  3. Improve decision making, planning and prioritisation by improving understanding of uncertainty and risk.

Key to implementing the above was the support of senior management and the authority provided by the Crossrail’s governance through the adoption of an independent sub-committee for the approach to risk management, as well as visibility of performance through a robust set of performance indicators and assurance framework.

Crossrail has taken the approach of integrating Health and Safety risk into its overall risk management process which differs from other railway models where the safety risk model is generally separate from the business risk model. As a result, risk management covers all categories of risk, both during design and construction as well as during commissioning and operation, including:

  • Health and Safety risks;
  • Business Risks including Funding and Delivery risks;
  • Engineering and Design risks;
  • Interface and Logistics risks;
  • Environmental risks;
  • Quality risks;
  • Business Continuity risks; and
  • Security risks (including Fraud).

Crossrail’s approach to risk management is set out in the risk management framework of documentation shown below:

PPM_Risk Diagram 1

Key risk management documents:

Early in its development, Crossrail was innovative in its rejection of optimism bias in favour of Quantitative Risk Assessment (QRA) techniques. This approach placed an early focus on the management of risk and uncertainty and resulted in a helpful acknowledgement that outturn costs should be reported as a range. This resulted in Crossrail’s reporting of Anticipated Final Crossrail Direct Cost (AFCDC) at P50 and P95. A future learning legacy paper will discuss the above and how a Quantified Risk Assessment process was then implemented throughout the organisation and integrated within the cost management process.

As well as implementing formal risk management disciplines within the client organisation, risk management was extended throughout the supply chain.   A learning legacy paper on Supply Chain Risk Management  describes Crossrail’s approach to both mandating a consistent approach to risk management through the Works Information and also to engaging and working with the contractor teams to develop their capability beyond the minimum requirements to the benefit of both parties.  A further paper – Managing Risk under NEC Contracts – will review the relationship with NEC Target Cost Contract and the Early Warning process.

Risk management worked in partnership with the insurance and assurance functions within Crossrail.The learning legacy paper Risk and Assurance demonstrates the key role this played in keeping the project on track.  Future learning legacy papers will review successes and lessons learned from the collaborative approach taken. A Strategic Risk Management paper identifies the importance of recognising  high level strategic risks and engaging senior management in the risk process.

Crossrail has been a contributor to the Infrastructure UK work on risk resulting in a report on Managing Cost Risk and Uncertainty in Infrastructure Projects published by Institute of Risk Management.

 

Risk Documents and Videos

Summary Publication date Document Type

Engaging the Supply Chain in Risk Management

Topic area: Risk Management

Managing risk and uncertainty was identified as being a  critical element from the start of the Crossrail project. The size, complexity, nature of the works, and ‘thin client’ operating model resulted in a requirement to extend risk management into the supply chain. This paper describes the process of doin...

14/03/2017 Micro-report

Risk and Assurance

Topic area: Risk Management

For Crossrail Risk and Assurance played a key role in keeping the organisation on track and within its project delivery targets. As a public sector funded project, Crossrail has to provide assurance to a number of external bodies in relation to its governance and effectiveness of delivery. This paper describes its appr...

14/03/2017 Micro-report

Strategic Risk Management

Topic area: Risk Management

From an early stage of the project, managing risk and uncertainty was identified as being critical to the successful delivery of the Crossrail project. The project’s senior management were strongly supportive and actively engaged in implementing the risk management process, which facilitated the creation of a dedicat...

14/03/2017 Micro-report

Risk Management Plan

Topic area: Risk Management

Managing risk and uncertainty is vital to the successful delivery of Crossrail. This Risk Management Plan describes the activities, governance, roles, responsibilities and process which are required to ensure that Crossrail manages its risks effectively. It forms part of a consistent suite of documentation which descri...

27/09/2016 Good Practice Document

Risk Management Policy

Topic area: Risk Management

Managing risk and uncertainty is critical to the successful delivery of Crossrail. This Risk Management Policy was put in place to ensure that risk management is an integral, visible and consistent part of routine management activity across the programme. It also outlines how effective risk management can support progr...

27/09/2016 Good Practice Document

Quantitative Risk Assessment Procedure

Topic area: Risk Management

The purpose of this procedure is to set out how Quantitative Risk Assessment (QRA) is undertaken on Crossrail. It represents a quality plan for achieving Crossrail risk management objectives. It is written to accord with the: Crossrail Risk Management Plan Crossrail Risk Management Procedure Change Control and Budget ...

27/09/2016 Good Practice Document

Risk Videos

Topic area: Risk Management

A number of videos have been produced outlining the importance of risk management to Crossrail and also detailing how it is important for the project to consider the risk strategy when working with contractors and the wider supply  chain. Each of the videos are linked below: The importance of Risk Management to the...

26/02/2016 Video

Managing Cost Risk and Uncertainty in Infrastructure Projects

Topic area: Risk Management

In 2015 Infrastructure UK undertook a review of the cost of infrastructure projects in the UK and how this cost could be reduced.  One workstream researched the management of cost risk and uncertainty throughout the project lifecycle, the incentive being to significantly reduce the cost of projects by curbing unnecess...

30/12/2013 Good Practice Document

Risk Management Critical to Crossrail’s Success

Topic area: Risk Management

Following the positive outcome from the UK government’s 2010 comprehensive spending review, the Crossrail cross-London railway project started awarding its main construction contracts. The author explains how risk management has already benefited the project and why its adoption by the supply chain is critical. Acce...

30/05/2011 Journal Publication

Strategic Risk – A Guide for Directors

Topic area: Risk Management

Strategic risk consists of the most important risks that an organisation faces, i.e. the possible future scenarios that would make a material difference (for better or worse) to its ability to achieve its main objectives or even to survive. These risks differ in magnitude from project risks or operational risks, which...

01/05/2006 Journal Publication