Operations Due Diligence
As risk and due diligence engineers, R2A has the opportunity to work on a diverse range of projects. Interestingly we are currently undertaking two operations due diligence reviews for two very different applications. The first is a review for the power supply at the Monash Medical Centre and the second is the supply of Class A recycled water from the Eastern Treatment Plant.
Both studies are utilising our Operations Due Diligence methodology. This process tests for the catastrophic, low likelihood outliers before it optimises for operational availability. It does this by testing the system as a whole in relation to management concerns, applying a top-down systems analysis approach that focuses analysis effort where it is needed. This approach means many lower-level sub-systems don’t need to be analysed in detail, as further analysis is not performed if information to answer the question is produced. It also aligns results with management’s concerns, often with far less effort and more clarity than a full bottom-up analysis.
Traditionally, risk analysis techniques are not normally considered as part of an availability analysis, which is usually focussed on system functional design and reliability and maintainability of system elements. From an organisational viewpoint, however, all causes of system failure are important, including further factors such as external effects (for example, materials supply interruptions, picketing, power failures, bushfires, floods, staff epidemic) and accidents (for example, building fires, materials handling, vehicle collisions, operator errors). These factors are external to the traditional scope of availability analyses but can have a disproportionate effect, as the damaged caused can be severe, leading to much longer downtimes than simple failures.
Operations Due Diligence includes these factors, assessing the criticality and risk of such threats from the start of the analysis and consists of four steps:
- Context (or boundary) vulnerability assessment
- Common mode (zonal) vulnerability assessment
- Functional availability modelling
- Options review, investment payback analysis and recommendations.
Further information on our Operations Due Diligence methodology can be found in our Operations Due Diligence whitepaper.