Should you attend the Engineering Due Diligence Workshop?

An introduction to the concept of Engineering Due Diligence

Engineering is the business of changing things, ostensibly for the better. The change aspect is not contentious. Who decides what’s ‘better’ is the primary source of mischief.

In a free society, this responsibility is morally and primarily placed on the individual, subject always to the caveat that you shouldn’t damage your neighbours in the process. Otherwise you can pursue personal happiness to your heart’s content even though this often does not make you as happy as you’d hoped. And it becomes rapidly more complex once collective cooperation via immortal legal entities known as corporations came to the fore as the best way to generate and sustain wealth. This is particularly significant for engineers as the successful implementation of big ideas requires large scale cooperative effort to the possible detriment of other collectives.

The rule of law underpins the whole social system. It is the method by which harm to others is minimised consistent with the principle of reciprocity (the golden rule – do unto others as you would have done unto you) prevalent in successful, prosperous societies. In Australia it has been implemented via the common law and increasingly, in statute law. Company directors, for example, have to be confident that debts can be paid when they fall due (corporations law), workers (and others) should not be put unreasonably at risk in the search for profits (WHS law) and the whole community should be protected against catastrophic environmental harm (environmental legislation). It is unacceptable for drink-drivers to kill and injure others, the vulnerable to be exploited or the powerful to be immune from prosecution. Everyone is to be equal before the law.

Provided such outcomes are achieved, the corporation and the individuals within them are pretty much free to do as they please. Monitoring all these constraints and ensuring the balance between individual freedoms and unreasonable harm (safety, environmental and financial) to others has become the primary focus of our legal system.

But the world is a complex place and its difficult to be aways right particularly when dealing with major projects. But it is entirely proper to try to be right within the limits of human skill and ingenuity. The legal solution to address all this has been via the notion of ‘due diligence’ and the ‘reasonable person’ test.

Analysing complex issues in a way that is transparent to an entire organisation, the larger society and, if necessary, the courts can be perplexing. Challenges arise in organisations when there are competing ideas of better, meaning different courses of action all constrained with finite resources. This EDD workshop provides a framework for the various internal and external stakeholders to listen to, understand and decide on the optimal course of action taking into account safety, environmental, operational, financial and other factors.

To be ‘safe’, for example, requires that the laws of nature be effectively managed, but done in a way that satisfies the laws of man, in that order.

Engineering Due Diligence Workshop

The learning method at the R2A & EEA public workshops follows a form of the Socratic ‘dialogue’. Typical risk issues and the reasons for their manifestation are articulated and exemplar solutions presented for consideration. The resulting discussion is found to be the best part for participants as they consider how such approaches might be used in their own organisation or project/s.

Current risk issues of concern and exemplar solutions include:

• Project schedule and cost overruns. This is much to do with the over-reliance on Monte Carlo simulations and the Risk Management Standard which logically and necessarily overlook potential project show-stoppers. A proven solution using military intelligence techniques will be articulated. This has never failed in 20 years with projects up to $2.5b.
• Inconsistencies between the Risk Management Standard and due diligence requirements in legislation, particularly the model WHS Act. A tested solution that integrates the two is presented, as is now being implemented by many major Australian and New Zealand organisations, shown diagrammatically below.

• Compliance does not equal due diligence. Solutions are provided to avoid over reliance on legal compliance as an attempt to demonstrate due diligence. It also demonstrates how a due diligence approach facilitates innovation.
• The SFAIRP v ALARP debate. Model solutions presented (if relevant to participants) including marine and air pilotage, seaport and airport design (airspace and public safety zones), power distribution, roads, rail, tunnels and water supply.

Participants are also encouraged to raise issues of concern. To enable open discussion and explore possible solutions, the Chatham House Rule applies to participants’ remarks meaning everyone is free to use the information received without revealing the identity or affiliation of the speaker.

To find out more information about the Engineering Due Diligence Workshop held in partnership with Engineering Education Australia, head to our workshop page or contact course facilitator, presenter and R2A Partner Richard Robinson at richard.robinson(@)r2a.com.au or call 1300 772 333.

If you're ready to register, do so direct via EEA website here.

Engineering: Ideas and Reality

Engineers play an integral role in bringing society’s wishes to fruition. As Engineers Australia’s monthly magazine create notes, we engineer ideas into reality.

However, when we go about taking ideas and making them real we have responsibilities. We are obliged to consider the ideas’ risks as well as benefits. We must ensure that our engineering activities meet our society’s expectations, and in particular that we address all our legal duties as engineers.

And so, even as we engineer new ideas into reality, we must also engineer the new reality we create into ideas – the ideas expressed in Australia’s laws.

Australia is an egalitarian society. Our judicial and political systems are predicted on the basis of equality for all before the law. This gives rise to a number of interesting ideals. For instance, one of our fundamental legal safety principles is that, for a known safety hazard, everyone is entitled to the same minimum level of protection. This arises from work health and safety legislation in all states and territories.

As another example of this, recognised good practice is a standard to which all engineers are held, in safety matters and otherwise. Engineering good practice is demonstrated in many ways, including standards and guidelines for design, operation, asset management and so on. It is also presented in regulations, which essentially present good practice that is so well recognised that the governments agree that it must be mandated. The National Construction Code is a prime example of this.

This reliance on recognised good practice means that, for instance, an engineering project manager who fails to implement recognised good practice measures to address the risk of project cost or timeline overrun would very likely expose his organisation to civil liabilities.

The simplest, cheapest and most effective way for engineers to address these and other legal requirements is to adopt systems and processes that demonstrate due diligence, that is, that all reasonable measures have been taken. This approach ensures engineering activities and engineering decisions are conducted in a manner consistent with legal requirements – that as we engineer ideas into reality, we also engineer reality to the right ideas.

To learn more about demonstrating due diligence as engineers, register for EEA’s Engineering Due Diligence workshop.

EEA R2A Due Diligence Workshop Wrap Up

As a new addition to the R2A Consulting team, the timing of the recent EEA (Engineering Education Australia) and R2A ‘Engineering Due Diligence’ workshop was such that I was able to attend in my first few weeks of my new role.

Richard Robinson presented the workshop with eight participants from various industries and locations in Australia, which provided for interesting and varied discussion.

The workshop was the first of its kind following the recent partnership between R2A and EEA. Previous workshops had been more structured and closely followed the framework of the R2A text (2013) Risk and Reliability: Engineering Due Diligence, whereas the focus of this workshop explored in greater depth the queries and views of the participants in attendance.

The topics that stimulated most discussion amongst the group were -

1. Risk paradigms as they relate to business, projects and safety
2. Implications of the model Work Health and Safety Act
3. Limitations of the risk management standard as a tool to manage critical vulnerabilities
4. Determining critical success factors and undertaking a vulnerability assessment
5. Establishing time sequence diagrams
6. Establishing threat-barrier diagrams and locating the legal loss of control point

Of interest also was the diverse range of legal and technical examples that Richard drew upon to support the points of discussion that demonstrate due diligence or not, the case may have been.

The workshop format worked well and the feedback from the group was overwhelmingly positive. And no R2A workshop would be complete without the entertainment of a good set of well delivered jokes!

R2A is set to conduct more due diligence workshops like this in 2014 which I think will be of great value to personnel of varied responsibility including but certainly not limited to company directors, senior executives and project managers.

WH&S Workshops - Perth

Work Health & Safety (OHS) Training Workshops – Perth

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The introduction of the new Work, Health & Safety Act in Western Australia is expected in late 2012/13. The WA parliament has completed drafting the bill for general industry and is seeking public comment. This legislation is expected to replace existing OHS legislation.

The changes are such that most internal OHS systems wont comply with the new legislation. Is your OHS policy ready for the change?

The proposed new Work Health & Safety Act requires a positive demonstration of due diligence, a large paradigm shift from the traditional hazard based approach encourage by the current risk management standard and most existing OHS legislation.

Is your business ready for the change? Has the management team in your organisation reviewed the OHS policy of your organisation? Are you a responsible officer under the new legislation?

The new WHS Act should be on the agenda at your next Board meeting.

Now is the time to act and to learn more. Why not join R2A for a half-day workshop on 5th October.

The workshop will explain the implications of the new Act with a focus on organisational governance with respect to safety matters and how you can positively demonstrate due diligence.

The workshop will provide participants with –

• An appreciate of the new Act and relevant High court case law and the impacts of such
• An understanding of the paradigm shift from hazard based risk management to precaution based risk management
• An understanding of the requirement for a positive duty of care for officers to exercise due diligence
• An appreciation of R2A’s defensible risk management approach including practical examples from a case study

Register now for the Work Health & Safety (OHS) Training Workshops on 5th October.

Questions?

Please contact Gaye Francis on 1300 772 333 or email Gaye here.