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Scoping risk assessment for an Olympic velodrome

Outline

This case study describes the conduct and outcomes of an initial risk assessment of the Sydney Olympic Velodrome, undertaken in 1994 in the early stages of Olympic facilities planning. The intention was to facilitate a short brainstorming session, involving the main Government stakeholders in the development of the velodrome, to provide input to a subsequent value management study.

Risk assessment

Overview

The session followed the initial steps in the NSW Government Risk Management Guidelines, a precursor to the Australian and New Zealand Standard AS/NZS 4360 Risk management, which itself formed the basis for the risk management approach contained in the international standard ISO 31000 Risk management – Principles and guidance. (The NSW Guidelines used different terms from ISO 31000, but we shall use those from ISO 31000 here.)

Participants in the process included representatives from Government agencies concerned with sport, Olympic planning, urban planning, architecture, facility construction and venue management.

Establishing the context

Establishing the context involved an examination of briefing documents to develop an initial structure of 12 topics for the workshop. Other steps in the context-setting process, including the identification of stakeholders and the definition of critical success factors, were incorporated into the workshop itself.

The objectives for the velodrome are listed in Table 1.

Table 1: Objectives for the velodrome

Focus area

Objective

Sydney 2000 Olympic Games

A venue for track cycling at the Sydney 2000 Olympics, including a preliminary event to test the facility

Sydney 2000 Paralympic Games

A venue for events during the Sydney 2000 Paralympics

Track cycling

A velodrome for long-term cycling use at all levels in NSW

Other sports

A velodrome with flexibility to accommodate other sports

Other functions

Accommodation within the velodrome for other functions related to or compatible with the sport of track cycling

Capacity

A velodrome capable of expansion for use for an Olympic Games or World Championship in track cycling

Management

A facility that facilitates efficient management and operation

International events

A velodrome that will attract international events to Sydney

Urban design

A velodrome in keeping with the development plans for Sydney Olympic Park

Budget

Construction within the Government’s budget

These objectives were reduced to five criteria for the risk assessment:

  • Performance of the facility for track cycling
  • Performance of the facility for Olympic and Paralympic use
  • Performance of the facility for other requirements
  • Budget
  • Construction schedule.

The initial structure for the risk assessment was based on the main phases of the procurement and life of the asset. The structure was adjusted during the workshop to reflect the stakeholder interests and priorities as they emerged in the discussion. The 12 key elements were:

  1. Pre-design and planning
  2. Registration of interest and short-listing
  3. Procurement policy and the split between private and public involvement
  4. Approvals, including environmental approvals
  5. Selection of contract form
  6. Tendering and evaluation
  7. Contract negotiation
  8. Design
  9. Construction
  10. Acceptance, commissioning and handover
  11. Olympic and Paralympic Games use
  12. Continuing operations.

Workshop process

The workshop process involved two phases. In the first phase, the structure and analysis framework was discussed, and the lists of key elements, stakeholders and critical success factors were adjusted to suit the participants’ priorities. The description here reflects the adjustments made during this first phase.

During the second phase, each key element was examined. For each key element, the following steps were conducted:

  • The general nature of the key element was discussed, to provide a common understanding for the assessment
  • A structured brainstorming took place, to generate a list of the risks that might affect the element; these were recorded on an electronic white board and adjusted to eliminate obvious duplications and irrelevant risks, but otherwise the participants attempted to avoid inhibiting the brainstorming process by commenting on the risks at this stage
  • Each risk was rated in terms of its potential impact (linked to the five criteria noted above) and the likelihood of that level of impact
  • The stakeholder with the prime responsibility for managing each risk was noted, where this could be identified.

The likelihood analysis took account of the potential for problems in:

  • Preparation and planning
  • Procurement
  • Construction
  • Commissioning and acceptance
  • The first five years of operation.

For the first elements from the list of twelve examined in the workshop, an attempt was made to record the individual criteria that might be affected by each risk. However, this did not prove practicable in the time available and so it was not continued for all elements.

Outcomes

The impact and likelihood ratings were converted to a risk score for each of the 126 risks identified in the workshop. The risk profile is summarised in Figure 1.

Figure 1: Initial risk profile

Actions

The assessment process was undertaken quickly, to meet tight timing requirements. It was recognised that the workshop outcomes would have to be reviewed and extended, to ensure that the best possible use was made of the findings. It was nevertheless seen as an important scoping exercise and a valuable contributor to the initial value management study that would follow, as well as initiating the process of risk management for this facility.

Immediate risk-related actions that followed the workshop included:

  • Assigning responsibility for developing a Risk Management Plan for the velodrome development
  • Reviewing the risks and priorities from the workshop
  • Reviewing and agreeing the stakeholder responsibilities for each risk
  • Ensuring the responsible stakeholders developed action plans for managing each major risk
  • Ensuring the responsible stakeholders had plans in place for managing each moderate risk
  • Developing a monitoring plan for implementation, as part of the Risk Management Plan.

Lessons

The risk assessment described here was undertaken at an early stage in the velodrome development: only an outline concept was available, a site had been identified but not yet formalised, the procurement strategy had not been agreed, and Sydney had not even been awarded hosting rights for the 2000 Games. Nevertheless, the risk assessment process was valuable.

  • It identified a broad set of risks for inclusion in the velodrome project plans
  • It initiated policy discussions about balancing Olympic requirements and long-term future uses of the velodrome among key stakeholders.

An important lesson here is that the risk management process can, and should, start early in the life of a project. The early focus is on strategic and policy matters, when great detail is neither available nor needed; risk assessment at this stage helps to focus subsequent activities on the most important areas of uncertainty, and so assists in shaping the strategic and policy approach that is adopted.

There are close links between risk management (RM) and value management (VM), and a form of RM is part of the evaluation phase of the VM process. The VM that was proposed for the velodrome was to examine the initial concept options, and the high-level initial risk assessment described here was well suited to this purpose.

Subsequent note

Shortly after we prepared this case study for our web site, the Australian Olympic Committee announced that Australia's flag bearer at the Opening Ceremony for the Rio Olympic Games would be Anna Meares, Austraia's most successful track cyclist. Rio will be her fourth Olympic Games. Congratulations and best wishes!

Client:
NSW Government agencies
Date:
1994
Sector:
Public sector and government business
Sport and recreation
Services included:
Value management
Risk assessment and risk treatment