DWIC18 - NASA on managing space-age risks from the coalface

The National Aeronautics and Space Administration’s (NASA) advanced risk management framework – which places the ownership of complex space-age risks into the hands of those working at the coalface – was revealed to delegates at this year’s Dubai World Insurance Congress (DWIC) 2018.

NASA’S aerospace engineer Jeevan Perera’s presentation added an interesting risk-focused dynamic to the (re)insurance-related discussions at this year’s DWIC, which focussed on the risks and opportunities linked to emerging markets, technologies and customers for day two.

Perera revealed a bottom-up but “integrated” risk management process, which sees project managers and engineers, rather than risk management professionals, lead in the identification of project-related risks.

Perera told the conference, attended by 600 (re)insurance professionals from 40 countries, that this approach encourages a holistic and ‘enterprise-wide’ risk management system, effective in reducing the myriad threats that could prevent NASA’s space explorative missions.

He said that risk management was more effective if NASA’s project leads and subject matter experts were embedded into the risk framework, and qualified risk professionals supported them in their risk efforts.

He said: “Take our international space station programme office, as an example. Each department within that programme would assign one engineer as its ‘mini risk officer’; and the risk management professional would train that engineer on how to identify and manage risks.

“The most important elements about this approach is that we have the best knowledge on that particular project or mission, and that we are not bringing ‘outside individuals’ to analyse and manage risks.”

He added: “We wanted to leverage existing [project] processes, to avoid a disparate risk management programme. Risk management needs to be integrated into the business process.”

This framework, backed by a self-insurance programme, is further supported by a risk management board for the escalation of more complex and strategic risk.

The risk management board is responsible for quantifying the impact of more complex risks; the implications for stakeholders; and developing a risk mitigation strategy.

Perera’s presentation elicited discussions at the event around how NASA’s risk management model provides a good example for how (re)insurers could amplify efforts in adopting a ‘service-driven’, consultative approach around risk mitigation.