IN A PERFECT WORLD, chemical shippers and the companies that provide transportation and storage services wouldn't have to worry about accidents and spills. Every shipment would arrive safe, secure, and on time.
Unfortunately, we don't lead a utopian existence. We live in a world with plenty of factors that challenge the security of every shipment. However, risk assessment makes it possible to identify and address most of the challenges.
Chemical shippers and carriers addressed risk assessment at length during the Hazardous Materials Transportation Safety Inter-Industry Workshop August 22 and 23 in New Orleans, Louisiana. Chevron Phillips Chemical Co LP, American Chemistry Council, Dupré Transport, Burlington Northern Santa Fe Railway, the Transportation Research Board, Department of Transportation Research and Special Programs Administration (RSPA), and Kirby Marine jointly sponsored the workshop.
Among the conclusions coming out of the workshop: Better industry-standard information is needed for the risk assessment process, along with better benchmarking to quantify risk. All areas of the company need to be involved in risk assessment. Better coordination is needed between the tank truck, railroad, and tank container industries.
Several speakers raised a concern that risk data is sorely lacking for many of the transport sectors. Railroads and the Association of American Railroads were recognized for developing detailed incident and accident statistics for the rail sector. The same broad statistics are needed for the trucking, intermodal container, and marine sectors.
Participants expressed concern that third parties pose an obstacle to good communication between shippers and carriers. Mergers are bringing new challenges for all parties, and workforce consolidations have resulted in a loss of people with an understanding of the risks inherent in hazardous materials transportation.
A Douglas Reeves with the Department of Transportation's Office of Hazardous Materials Safety (OHMS) said that risk management is something that every organization involved in hazmat transport does at some level. Statistics show that most companies do a good job of controlling risk.
Proof can be seen in fatality statistics. For instance, an average of 33 hazmat transport fatalities per year were recorded from 1994 to 1998. In contrast, automobile fatalities for that period averaged 41,616 per year.
OHMS Risk Management
OHMS has its own risk management system that is designed to address a broad set of hazardous materials, most modes of transport (except bulk marine, pipeline, and postal), and all routes. The program places a premium on uniformity and consistency.
Risk management and assessment are used in rulemakings. In one form or another, risk assessments have been an integral part of rulemakings in areas such as the wet-lines-elimination rules that are still under development.
In an effort to improve risk assessments at all levels, OHMS developed the Risk Management Self-Evaluation Framework (RMSEF). The process is a tool to help understand and manage risk. It encourages and builds on existing efforts by providing a way to systematically assess risk issues in any operation.
“However, this is not a regulatory mandate,” Reeves said. “It's not a standard or best practice. It is not a rigid or prescriptive methodology. It is voluntary, flexible, and can be tailored to individual circumstances.”
The RMSEF process consists of seven steps: scoping, knowledge of operations, assessment, strategy, action, verification, and evaluation.
Under scoping, the risk manager characterizes hazmat transportation operations and responsibilities. He identifies other organizations that impact his company's hazmat transportation (shippers, cargo tank manufacturers, emergency responders). Risks are identified, as is the scope of the operation that needs risk management.
In building knowledge of the operation, management collects detailed information about transportation operations, including quantities of hazmat transported, who handles the materials, and where and when they are handled. Safety programs and policies already in place are described.
Control Points
In the assessment phase, management analyzes the information gathered in the previous steps to characterize the nature and magnitude of the risks. Reeves suggested identifying points in the transportation chain where actions can be taken to affect risk. These are called control points.
“Some examples of risk control points for the government are material classification standards, packaging specifications, outreach and compliance, and our Emergency Response Guide,” Reeves said. “For industry, some risk control points would be hazard identification and classification, carrier and route selection, employee knowledge and training, vehicle condition and maintenance, and operating procedures.”
Risks need to be ranked or grouped according to criteria established by the company as a first step to building a strategy. Opportunities for risk reduction are prioritized. These findings should be collected in a written document that summarizes decisions and lays out a plan of action.
The written plan should be implemented in the action phase. Verification is the process of monitoring the risk management strategy to make sure that actions decided upon are carried out successfully. Periodic evaluation is needed to ensure that everything stays on track.
Recognized Discipline
Mark Abkowitz, professor of civil engineering and management of technology at Vanderbilt University, said that risk management is coming of age as a recognized discipline. However, industry has yet to embrace all of the tools needed to promote risk management as a core business practice.
Those tools are information clearinghouses, database management, and performance monitoring. “Companies need to adopt a systematic approach to risk management, and they must view the risk analysis process as more than just a snapshot in time,” he said. “Risk management, especially in transportation, is a living process. Change is constant.”
The DuPont Co puts considerable time and effort into corporate risk management policies, specifically those focused on distribution safety and risk management. “We see distribution as an extension of the manufacturing process,” said Cherry Burke with DuPont.
While each business unit is responsible and accountable for managing risks within its operation, some prioritization does take place at the corporate level. This is particularly true for highly toxic materials (HTMs).
HTMs are defined based on vapor pressure and toxicity. The corporate standard for these products applies to fixed sites and transportation. It requires establishment of safety guardian committees (SGCs), development of material-specific standards, and additional requirements as needed.
Where transportation is required for HTMs, the SGC must specify the minimum acceptable design of DuPont-owned or leased equipment and non-DuPont equipment. The SGC also must specify the design of DuPont-owned and dedicated distribution facilities.
Special emphasis is placed on off-site storage, including rolling stock. More attention is given to selection and training of carriers and storage providers. Routing gets a close look.
Overall, DuPont follows a step-wise approach in distribution risk management. Management prioritizes activities, examines current practices, questions what might go wrong, and considers what improvements are needed.
What risk managers need more than anything else is good data. One of Burke's concerns is that there isn't adequate risk data for all transport modes. “We lack sufficient data to accurately define risk for different modes,” she said.
While route assessments usually are performed only for HTMs or products that are poisonous by inhalation, Burke recognized that they could be a useful tool. “Sometimes there is more than one good direct route,” she said. “This can help in tracking time-sensitive shipments, as well as those that are highly hazardous.”
Multiple Factors
Avoiding populated areas is not the main or only focus of route assessments. Multiple factors are considered, including road and rail characteristics and quality, population centers, timing along the route, overall transit time, and location of emergency response resources.
Route assessments are not a replacement or alternative for a detailed risk management program, though. “Route assessments are not detailed enough,” Burke said. “Simply using a route analysis program can result in impractical routes and even increased risks.”
Burke added that it's important to focus on issues that most clearly relate to actual distribution conditions. “Risk managers need to step back from their obsession with fatality statistics,” she said. “All too often, managers concentrate the risk management effort on catastrophic risks that have a low probability.”
Good risk management requires looking at all factors and working with all relevant stakeholders. These include other shippers, package manufacturers, carriers, regulators, and the public. “It's especially important to work with your carriers on route and risk assessments,” Burke said. “Safe transportation and risk reduction is a joint effort. It's everyone's responsibility.”