MGT8077 Project Risk Management: A BHP Billiton Case Study

This report critically analyzes the risk management practices adopted by BHP Billiton, a multinational mining company, focusing on health and occupational risks. It examines the risk management processes, including risk identification, analysis, evaluation, treatment, and integration. The analysis co...Read More

Running head: RISK MANAGEMENT
Assignment – 2: Risk management
Name of the Student
Name of the University
Author’s Note

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Executive Summary
The paper mainly reflects on the risk management practices that are required to be utilized for
resolving the health and occupational risks that the organization “BHP Billiton” faces. It is
identified that due to health and occupational risk the organization faces lot of issues and
challenges that is needed to be resolved effectively. It is found that a well-designed
occupational health as well as safety program is considered to be too good for the wellbeing
of legal as well as social obligation and therefore project risk management practices for
resolving health and occupational risks is one of the most important requirements. The paper
reflected on various risk management processes for identifying the risks that are associated
with the project. It is identified that the paper also analyzes health and occupational risk and
evaluates them properly for resolving them. In addition to this, proper risk treatment as well
as risk management integration is generally utilized in order to reflect the significance of risk
management within the project. Moreover, the paper also elaborates some of the
recommendations that are very much necessary for managing the occupational as well as
risks that are associated with the health and safety of the project employees.

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Table of Contents
1. Introduction............................................................................................................................3
2. Organizational context...........................................................................................................3
3. Risk management process......................................................................................................4
4. Risk identification..................................................................................................................6
5. Risk analysis and evaluation..................................................................................................8
6. Risk treatment......................................................................................................................10
7. Risk management integration...............................................................................................12
8. Findings and recommendations...........................................................................................14
9. References............................................................................................................................16

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1. Introduction
The paper mainly focusses on reviewing the health and occupational risks within the
organization BHP Billiton which is one of the multinational mining, metals and petroleum
dual listed company that has its headquarters in Melbourne, Australia (BHP, 2018). As the
part of the review, the paper reflects on the risk management processes as well as practices
that is adopted by the organization BHP Billiton in order to mitigate as well as for reducing
the health and occupational risks that are mainly associated with the organization “BHP
Billiton”.
The paper generally focusses on the risk management processes and risk identification
processes. It is identified that the paper also analyzes health and occupational risk and
evaluates them properly for resolving them. In addition to this, proper risk treatment as well
as risk management integration is generally utilized for managing the risks as well as
challenges of the organization.
2. Organizational context
The organization “BHP Billiton” which is one of the mining company for whom
health and safety measures are quite critical. Therefore, the organization utilizes proper risk
management practices as well as processes so that they can be able to protect as well as
manage the health and well-bring of the employees who are mainly associated with the
organization (BHP, 2018). It is analyzed that as the employees of the organization faces lot
of health and occupational issues including exposure to stressor, silica as well as diesel
particulate matter (Yazdani et al., 2015). Thus, in order to reduce the impact of the risk, it is
very much important to utilize proper risk identification, analysis as well as evaluation
processes. Utilization of proper risk treatment strategies are quite necessary for implementing
treatments as well as re-evaluating residual risk in order to resolve the health and

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occupational risks as well as challenges that are mainly related with the organization “BHP
Billiton”.
3. Risk management process
The risk management processes as well as frameworks that are mainly adopted by the
organization “BHP Billiton” are listed below:
Risk identification: The first and the most important step is to identify the risk. Risk
identification is considered as one of the important step that is necessary to undertake in order
to know the risk. It is found that the organization “BHP Billiton” utilizes brainstorming in
order to identify health and occupational risks as well as challenges that are mainly faced by
the employees of the organization (Rantonen et al., 2016). The organization also set up
interviews for gathering information that is needed for the identification of risk. While risk
identification it is quite important to make sure that it is very much important to analyze risk
that are much important to be minimized first.
Analysis of risk: The next step that is adopted by BHP Billiton is to determine the
likelihood of the risk. While assessing the risk including avoiding potential litigation,
complying with new legislation as well as reducing the impact of exposure must be
proactively addressed with their impacts. It is identified that risk analysis is quite hard and it
is analyzed that there is not enough information that one can gather. The organization utilizes
both quantitative as well as qualitative risk analysis method in order to identify the health and
occupational risks.
Prioritizing risk: The BHP Billiton prioritizes the risk as per their impact after risk
analysis. As the organization analyses some of the health and safety risk that have little or no
impact on the employees. Therefore, the organization prioritizes risks that high impact on the

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health and occupation of the employees and as per the priority the risks are resolved
successfully (Subramanian et al., 2016).
Assigning owner: The hard work that the organization does in identifying as well as
evaluating the risks will go in vain if the risks are not assigned to someone to oversee the
entire risk. It is found that it is quite important to assign the risk to the owner by identifying
the person who will be mainly responsible of resolving the risks and challenges that is
associated with health and safety issues. The employees who will be skilled in resolving the
risk should be assigned with the work of risk mitigation so that they can be able to utilize
proper methods as well as techniques for risk mitigation.
Respond to the risk: It is found that all the risks that are planned by BHP Billiton
will get implicated. But before this, it is very much important to analyze the positive or
negative risk that are associated with project. For each of the risk BHP Billiton, created
proper plan of risk mitigation. The plans that are used for used for mitigating the risks include
preventive measures or contingency planning (McNeil, Frey and Embrechts, 2015). After
then, it is very much necessary to act on the risks that are identified as well ad prioritized. In
addition to this, it is also important to communicate properly with the owner of the risks in
order to develop plans that are required to be created for resolving the risks.
Monitoring risk: In order to monitor the risks and challenges, BHP Billiton follows
proper steps in order to track the progress of the risk towards resolution. It is quite essential to
remain updated to get an accurate picture of the overall project progress in order to identify as
well as monitor the new risks as well as challenges of the project. The project manager needs
to arrange face to face meetings however some of the updates regarding the risks as well as
challenges needs to be delivered by email and text with the help of project management
software tool.

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4. Risk identification
The tools and techniques that are utilized by BHP Billiton in identifying the risks are
mainly elaborated below:
Information gathering techniques: It is identified that in order to identify risks, the
organization “BHP Billiton” utilizes various techniques with which they collect the
requirements as well as data that are associated with risk identification.
Brainstorming: It is one of the technique that is utilized by BHP Billiton for
focussing on the identification of risks that are mainly associated with the health and safety of
the organizational employees (Sui, Ding and Wang, 2018).
Delphi technique: In this technique proper team of experts are generally consulted. It
is found that a list of required information is generally sent to the experts with appropriate as
well as response for reviewing the risks until consensus us generally reached.
Interviewing: It is identified that the organization mainly utilized interview process
in which the stakeholders as well as experts who are associated with the project are
interviewed in order to analyze as well as identify the risks as well as challenges (Nexo et al.,
2018).
Root cause analysis: Root cause determination is one of the technique with which
BHP Billiton identifies risks that are mainly associated with the organization. It is found that
the root is further utilized in order to identify the additional risks that are mainly associated
with the risks.

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Checklist analysis: The checklist od risk categories are generally utilized for
analyzing the risks that are mainly associated with the health and safety of the employees
(Silva et al., 2016).
Risk register: Risk register is considered as one of the living document that is
generally updated on a regular basis throughout the lifecycle of the project. It is generally
considered as one of the section of the project that generally includes historical data that are
generally utilized for future projects. The risk register generally comprises of risks, their
potential response, root causes of risks as well as updated risk categories
Probability and impact matrix: This matrix generally assists in determining risks
that generally requires an immediate response (Jespersen and Hasle, 2017). The matrix must
be properly customized as per the needs of the project. The organization have proper
standardized template for the probability and impact matrix so that they can easily identify
the risks.
Identification of stakeholders and the level of importance of each stakeholder for
evaluating the degree of risk pertaining to the stakeholder is quite essential. It is quite
important to evolve risk management methods. It is found that before attempting to deal with
the stakeholder risk management, it is quite essential to understand the responsible
stakeholders and the risk perceptions related with the stakeholders (Yorio, Willmer and
Moore, 2015). The organization or project should identify the stakeholders by determining
their expectations and must evaluate and identify the levels of risk of each of them for
effectively managing the risk factors. Proper stakeholder analysis is very much essential so
that the stakeholder must be aware of the risk reception.
It is quite necessary to identify the stakeholders, various types of risks as well as level
of stakeholder commitment as well as degree of influence. It is found that effective risk

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management generally involves prioritization as well as proper analysis of risk factors as per
the probabilistic models which is mainly related with the risk impact (Giorgi et al., 2018). It
is found that stakeholders prioritization with the help of authority as well as degree of
involvement are quite necessary. It is found that this analysis generally helps in providing
proper valuable input to proper risk mitigation plan so that proper resources as well as
stakeholders are paid who generally poses greatest risk to the project.
Risk communication is considered as the process that helps in informing people with
potential hazards to the person, property as well as community. In the perspective of risk it is
very much important to have proper communication so that the risks that is associated with
health and safety can be mitigated quite effectively (Khan, Rathnayaka and Ahmed, 2015). It
is analyzed that communication generally assists in playing an important role in analyzing as
well as identifying the risks that are associated with the project. It is found that proper risk
communication tools must be utilized in order to resolve the risks and challenges that are
mainly associated with the project.
5. Risk analysis and evaluation
The risk that are identified within the project are mainly analyzed with the help of the
tools and techniques that are as follows:
Interviewing: Interview technique are mainly utilized for quantifying the probability
as well as impact of risk on the objectives of the project. The information that is required
generally dependent on the probability distribution type. It is identified that the organization
“BHP Billiton” must gather information on both pessimistic as well as pessimistic scenarios
that are commonly utilized for distributions (Rantonen et al., 2016). It is found that
documentation of the rationale for the range is considered as one of the important factor for

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risk interview as it generally helps in providing information based on credibility as well as
reliability of the analysis.
Probability distribution: It is found that continuous probability distribution
generally helps in representing the uncertainty in values including cost related with the
project. It is found that discrete distributions are generally used for representing various types
of uncertain event including outcome of test on a decision tree.
Sensitivity analysis: Sensitivity analysis is quite helpful in determining which risks
have the most important impact on the project. It generally helps in examining the extent to
which the uncertainty that is associated with the project generally helps in affecting the
objective that is being examined when all the various elements are generally helps at different
baseline values (Subramanian et al., 2016). One of the most typical display that is mainly
associated with sensitive analysis id the tornado diagram that is very much helpful for making
proper comparison with the various variables that have high degree of uncertainty to those
that are generally much more stable.
Decision tree analysis: Decision tree analysis is mainly considered as to be structured
by utilizing proper decision tree diagram that helps in helps in elaborating each of the choices
as well as possible scenarios. It generally assists in incorporating the cost that is mainly
available to each choice. It is found that the probability that is associated with each scenario
must have appropriate logical path. It is found that solving the decision tree generally assets
in giving the EVM for each of the alternative when all the rewards as well as subsequent
number of rewards are generally quantified.
Delphi method: The basic concept is to derive a consensus by utilizing proper panel
of experts for arriving at the convergent solution to a proper specific problem. It is found that
this is quite useful in arriving at proper probability assessments that is mainly related to

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various future events where the risk related impact is quite large as well as critical (McNeil,
Frey and Embrechts, 2015). It is found that the first and the most important step for selecting
proper panel of individuals who generally have proper experience in that specific area. In
order to achieve proper results, the members of the panels must know each other identity as
well as processes that needs to conducted with each of the separate locations.
Brainstorming: It is identified that this technique is utilized extensively while
planning the project and can be utilized properly for identifying as well as postulating various
risk scenario for a specific project. It is considered as one of the simplest attempt that help the
people to creatively involve in proper group setting (Nexo et al., 2018). The rules are that
each member must try to build on the basis of the ideas that is generally offered with the help
of various preceding comments. It is found that no criticism as dis-improvement are allowed.
6. Risk treatment
Risk treatment is considered as one of the action that is generally used for managing
the risk of the project. The risk management processes generally include various types of
steps including identification, assessing as well as treating risks. The health and occupational
risks that are associated with the organization needs to be treated with the help of the steps
that are as follows:
Avoidance: This risk treatment method is generally utilized in order to avoid the
health and occupational risks that are associated with the organization “BHP Billiton”. It is
identified that if the health and occupational risks that occurs does not create any negative
impact then the risks can be avoided (Silva et al., 2016).
Reduction: The health and occupational risks that are associated with the
organization BHP Billiton can be reduced with the help of proper mitigation measures. The

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risks that are associated with the project can be effectively be reduced with the help of this
method.
Transfer: Some of the risks that are associated with health and safety of the
employees can be transferred to the third party. The two main types of transfer include
outsourcing as well as insurance. The company must choose to transfer the risks related with
the organization by outsourcing the project effectively.
Acceptance: Risk acceptance is considered as one of the risk retention method that is
mainly selected for facing the risks that is associated with the project (Yorio, Willmer and
Moore, 2015). It is found that it is quite impossible to know the profits that are related with
the business for enjoying active value without selecting to take on proper risks.
Sharing: Rusk sharing is considered as a technique with which the risk is distributed
to multiple organizations or individuals. It is found that this is generally done with the help of
number of reasons including self-insurance strategies.
Residual risk: It is found that risk treatment generally does not necessarily helps in
reducing the risk to zero. The risks that remains after treatment is known as the residual risks,
It is identified that if a risk is too difficult to mitigate then the organization generally utilizes
this technique so that the risk can be minimized to a level and thus the impact that is
associated with the risk can also get reduced.
The risk treatment plan that is associated with the risks can be developed by utilizing
steps that are elaborated below:
Specifying the treatment option: There are various types of treatment options
including avoid, reduce, share as well as accept in order to specify the treatment option
(Khan, Rathnayaka and Ahmed, 2015). The project manager must engage in risk treatment as
per the risk that occurs, it will generally depend on the type of risk that mainly occurs.

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Documenting the plan: It is quite necessary to create a risk register that should be
clear as well as concise for handling the risks. It is necessary to use four response planning
for determining if the risks that occur is external risk or internal risk. It is quite essential to be
clear on who approves the entire risk management. The project team members must analyze
as well as suggests the risks quite effectively for dealing with the risks quite successfully.
Sponsors of the project must help in resolving the risks and it is needed to offer proper ideas
for tracking the risks with the help of the project stakeholders.
Assigning appropriate owner: It is quite necessary to assign proper owner as per the
risk who is mainly accountable for reporting as well as monitoring risks as per the progress of
the risk treatment plan. When both the risk owner as well as risk planner are different then it
is the responsibility of the risk owner to take the entire accountability in order to ensure the
agreed treatment plan is implemented (Yazdani et al., 2015).
Specifying target resolution date: When the risk treatment generally have long lead
times the it is quite necessary to develop the interim measures quite effectively. It is found
that it is quite unlikely for a residual risk to rate high.
7. Risk management integration
It is found that the risk management processes are generally integrated with the
project management practices within the project. It is found that the various risk management
processes are generally integrated in order to recognize the most important tool that is helpful
in tackling the uncertainty that is mainly associated with different practices of the project
management (Sui, Ding and Wang, 2018). It is found that the practices of project
management are generally integrated with risk management as risk management is generally
considered as one of the factor that generally helps in affecting the project success. When
something unforeseen happens while undertaking any of the practices of project management

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then it is quite difficult for managing the entire situation that generally might contribute for
the project failure.
It is identified that there are number of practices that are generally undertaken in
order to progress with the project. However, if a risk occurs while utilizing any of the
practices of project management then it generally can affect the entire project (Jespersen and
Hasle, 2017). The main goal of risk integration is to identify the risks and challenges in each
step that is utilized for progressing within the project so that it further does not create any
type of negative risk on the project.
The areas of project management generally assist in creating impact on the risk
management. It is found that if the entire project is initiated as well as planned successfully
then the chances of risk occurrence reduces. In addition to this, it is found that if each of the
phase of the project are properly reviewed then the chances of risk occurrence get minimized
(Khan, Rathnayaka and Ahmed, 2015). Thus, it is analyzed that if the practices of project
management are generally undertaken then it will create a huge impact on the risk
management and as a result the risks that are analyzed in the project are resolved quite
effectively.
It is found that the risk management mainly impact other areas of the project
management. It is found that due to effective risk management, it became quite easier to
progress within the project without facing any type of difficulty. The project managers can be
able to make better quality of decision making with the help of project practices as the risks
that are associated with the project are managed effectively and they do not create any type of
obstruction within the project. Proper management of project risks generally helps in setting
an expectation for achieving success within the project (Jespersen and Hasle, 2017). Proper
management of project risks generally focusses on the critical outcomes of the project and

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generally makes the team focused on the work which further helps in achieving success.
Proper management of project generally helps in saving time and cost and assists in providing
proper opportunities to the project (Giorgi et al., 2018). It is found that if the risks as well as
challenges that are associated with the project are managed then the impact on the project
also get reduced and as a result the project management practices generally assists in
finishing the entire project within the expected project and time.
8. Findings and recommendations
It is concluded from the entire project that effective risk management strategies as
well as techniques are quite helpful in resolving the health and occupational risk of the
organization “BHP Billiton”. It is found that effective risk management generally helps in
allowing the project managers in exploring different ways so that the risks that are associated
with health and occupation of the employees can be effectively get resolved. It is found that a
well designed occupational health as well as safety program is considered to be too good for
the well being of legal as well as social obligation (Silva et al., 2016). It is analyzed from the
project that effective risk management of health and safety risks generally helps the business
to meet the OSH expectation level of the customers and also encourages the work field to a
proper active life. It is found that the main goal of health and safety is to provide proper
nourishment so that the work environment can easily foster in the entire work field (Sui, Ding
and Wang, 2018). By keeping every individual safe as well as healthy, it is the responsibility
of the entire business to minimize the workers medical expenses as well as cost associated
with insurances. Keeping each of the employees of the organization safe and healthy will
generally be helpful in enhancing the efficiency as well as productivity for the entire business
for leading successful as well as proper business.

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It is identified that in this paper, proper risk management strategies as well as
techniques that are utilized by the organization for resolving health and occupational risks are
generally elaborated. The paper mainly focusses on the various processes of risk management
including the principles that is adopted by the organization “BHP Billiton”. It is found that
proper identification of risks based on the utilization of tools and techniques are done in order
to elaborate the significance of stakeholder’s analysis as well as communication for effective
management of project risks (Khan, Rathnayaka and Ahmed, 2015). The paper also
evaluates risk analysis and provides proper steps that needs to be followed by the project
manager in order to manage the project risks and for mitigating the risk that generally can
create negative impact on the project. The suitability of all the project risk treatment are
successfully explained for reflecting their importance. In addition to this the paper also
elaborates the significance of project risk management integration with the various practices
of project management.
The recommendations that are required to be followed while undertaking risk
management are listed below:
Ongoing longitudinal survey needs to be undertaken: It is found that proper
online longitudinal surveys must be undertaken for increasing the information or for
gathering health and safety risk factors for developing periodic modules.
Research program must be conducted: Proper research program must be
conducted for providing substantial as well as systematic understanding of the harmful
workplace exposure.
Establishment of occupational safety and health management system: OSH
management system helps in improving the work environment and assists in resolving the
risks that are associated with safety and health of the organization.

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9. References
BHP. (2018). BHP Billiton | A leading global resources company. [online] Available at:
https://www.bhp.com/ [Accessed 3 Jun. 2018].
Giorgi, G., Leon-Perez, J. M., Pignata, S., Demiral, Y., and Arcangeli, G. (2018). Addressing
Risks: Mental Health, Work-Related Stress, and Occupational Disease Management to
Enhance Well-Being. BioMed Research International, 2018.
Jespersen, A. H., and Hasle, P. (2017). Developing a concept for external audits of
psychosocial risks in certified occupational health and safety management systems. Safety
Science, 99, 227-234.
Khan, F., Rathnayaka, S., and Ahmed, S. (2015). Methods and models in process safety and
risk management: past, present and future. Process Safety and Environmental Protection, 98,
116-147.
McNeil, A. J., Frey, R., and Embrechts, P. (2015). Quantitative risk management: Concepts,
techniques and tools. Princeton university press.
Nexø, M. A., Kristensen, J. V., Grønvad, M. T., Kristiansen, J., and Poulsen, O. M. (2018).
Content and quality of workplace guidelines developed to prevent mental health problems:
results from a systematic review. Scandinavian journal of work, environment & health.
Rantonen, J., Karppinen, J., Vehtari, A., Luoto, S., Viikari-Juntura, E., Hupli, M., ... and
Taimela, S. (2016). Cost-effectiveness of providing patients with information on managing
mild low-back symptoms in an occupational health setting. BMC public health, 16(1), 316.
Silva, R. P., Barreto, B. M. F., Camacho, A. C. L. F., and Valente, G. S. C. (2016). The risk
management and interference in occupational health worker: integrative review. Revista de
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Subramanian, V., Semenzin, E., Hristozov, D., Zabeo, A., Malsch, I., McAlea, E., ... and
Linkov, I. (2016). Sustainable nanotechnology decision support system: bridging risk
management, sustainable innovation and risk governance. Journal of Nanoparticle
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Sui, Y., Ding, R., and Wang, H. (2018). An integrated management system for occupational
health and safety and environment in an operating nuclear power plant in East China and its
management information system. Journal of Cleaner Production, 183, 261-271.
Yazdani, A., Neumann, W. P., Imbeau, D., Bigelow, P., Pagell, M., Theberge, N., ... and
Wells, R. (2015). How compatible are participatory ergonomics programs with occupational
health and safety management systems?. Scandinavian journal of work, environment &
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Yorio, P. L., Willmer, D. R., and Moore, S. M. (2015). Health and safety management
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