Risk Management in Water Supply Network Development: A Report

This report delves into the critical aspects of risk management within the context of water supply network development, focusing on the United Arab Emirates, particularly Dubai. It emphasizes the importance of proactive risk analysis and treatment processes to mitigate potential issues during the implementation of water pipeline networks. The report outlines key issues such as location selection, financial risks, lack of training, protective equipment deficiencies, and time management risks. It then details significant features of effective risk management processes, including risk identification, analysis, prioritization, and strategy development. The report also identifies various risks associated with water pipeline development, categorizing them by type and impact, and discusses risk management techniques and treatment strategies, including avoidance, mitigation, transfer, and retention. The report concludes with a discussion of risk management and organizational culture and the identification of standards of risk management, referencing ISO 31000 as a benchmark for best practices.

Running head: RISK ANALYSIS TECHNIQUES AND RISK TREATMENT
Risk Analysis Techniques and Risk Treatment: Risk Management Issues Associated with
Engineering Asset Management for Water Supply Network Development
Name of the student:
Name of the university:

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Table of Contents
Introduction......................................................................................................................................2
1. Risk Treatment processes............................................................................................................3
1.1 Different key issues to be addressed in designing and operating the risk management
process.........................................................................................................................................3
1.2 Significant features for risk management processes..............................................................5
2. Identification of different risks....................................................................................................6
3. Risk management techniques and risk treatment.......................................................................11
3.1 Risk management processes and procedures.......................................................................11
3.2 Risk treatment......................................................................................................................18
3.3 Risk management and organizational culture......................................................................20
3.4 Identification of standard of risk management....................................................................20
Conclusion.....................................................................................................................................22
References......................................................................................................................................23

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Introduction
This report depicts the importance of developing proper risk management processes and
accurate risk treatment programs to mitigate the issues those are occurring during the
development of the water supply network implementation. Risk management is referred to as a
simple identification, assessment and prioritization of risks considering the economical and
coordination application for the development of opportunities. Risk might rise for different
reasons such as financial market, legal actions, accidents, regulatory liabilities and even natural
disaster (Vesper et al. 2016). The definition of risk is strictly compartmentalized depending upon
the business continuity, project management, security, engineering and process followed by the
industries.
Though, risk management is a basic concept but risk analysis and treatment defines the
details of risk. After analyzing the details of the risks management factors it has been defined,
that for business continuity is dependent upon risk management. In order to reduce the total cost
and operational details of the engineering asset it is necessary to recognize the risks that might
interrupt the water pipeline network development (Boyko et al. 2017). The water industries of
United Arab is facing huge challenges therefore for resolving the issues of risk management
processes are required to be development considering the standard ISO 3100. The key issues that
the water supply industry of Dubai (United Arab) is facing as a sequential task is identified. In
addition to this, the significance features of risk management with proper treatment and
processes are elaborated in this report.

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1. Risk Treatment processes
1.1 Different key issues to be addressed in designing and operating the risk
management process
In variety physiographic and climatic environmental setup it is found that due to the
interaction of ground and surface water involvement of different physical, chemical and
biological reactions are available. In the recent years of analysis it is defined that, the interest
about the ground water and surface water is increasing rapidly. However considering the health
condition of the human and other living creatures, the contamination of the water, lakes, streams
are needed to be avoided as much as possible (Dias 2017). The atmospheric fiction, sulfate,
nitrate deposition and certain climatic changes are also the reasons for the challenges for the
water distribution in Dubai. However, during evaluating the risks associated to the engineering
asset management that is “Water pipeline design”, many key issues are identified. The issues
associated to the project are as follows:
Risk with location selection: In order to develop the water pipelines networks it is
necessary for the developers to identify proper channel. If the nominated location is found to be
wrong then, water quality could be affected and even the flow of water delivery to both
residential and rural area can be interrupted (Shepherd 2016). Thus location selection is referred
to as one of the most important things which might raise major issues of the project manager
fails to highlight the proper location for the pipeline development. In addition to this, the
respective location based security approaches should also be adopted to avoid site risks.
Financial risks: In order to implement the project successfully it is necessary for the
project manager to make the feasibility study at the very project initiation phase. It would help

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the project manager to avoid economical risks (Aven, Vinnem and Wiencke 2007). All the
resources should be highlighted and cost should be estimated according to that, if the finance
manager fails to make the study accurately then they would face major financial risks while
implementing the project.
Lack of training: Development of water pipeline network is a complex project thus for
successful project implementation the associates must possess professional knowledge. In order
to make the professionals more engaged to their work accurate training and development
programs are need to be arranged. With the help of the training programs they will get to know
more about the project details.
Lack of presence for protective equipments: In order to avoid sudden challenges, the
project associates must hold proper protective equipments so that on urgent phases the situations
could be handled (Blanchard and Fabryky 2006). If the project manager fails to consider these
kinds of protective equipments then that would be another major key risk for the water pipeline
network development project. Protective equipments in terms of materials will help the to avoid
serious water chemical contamination.
Time management risk: While developing any project the three constraints that any
project manager should consider at the initial phase are the time, scope and budget. In order to
eliminate issues like over budget it is necessary for the project executive to complete the project
within allotted time phase. If the time gets exceed then the budget will also exceed according. It
will affect the entire project (Melchers 2001). Therefore, based on the project details the time
should be considered at the project planning phase. As this particular project is based on

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development of water pipeline network-engineering asset management, thus for the maintenance
of the pipelines is another components that must be highlighted to avoid time managerial risks.
1.2 Significant features for risk management processes
While analyzing the details of engineering asset oriented risks, it has been defined that, in
order to keep the assets safe from external assaults and for minimizing the risks associated to
water pipeline network development, risk management process is required to be developed
before starting the development process itself (Blanchard and Fabryky 2006). With the help of
the risk management approach the rate of uncertainty and interruption will be reduced.
Risk management process helps to treat for each risk considering the subset of plans
those have been implemented. The risk awareness also get enhanced with the help of proper risk
management approach. The issues that might rise regarding time and cost will also reduce as risk
management develops proper managerial strategies and contingent strategies as well. The project
manager would be able to meet the project need easily with regulatory compliances and by
building multiple business aspects properly (Kerzner 2013). Exact decision making process by
assuming and determining the roles and responsibilities of the project members also helps to
reduce the rate of project risks. While developing the water pipeline supply network in both the
rural and residential location as well risk management approach stands very much helpful. The
different phases of risk management process are risk identification, risk analysis, risk
prioritization and risk management strategies development. The key features for operational risk
management are as follows:
 Risk management process helps to enhance the value for the project team
members by incorporating attention in both return and risks as well.

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 It can increase the rate of care for the accurate capitalization, liquidity and
operational profitability.
 In order to better decisions risk management approach stands very much helpful.
 It takes care regarding the system security, project developers, capital sponsors,
employees, other investors and stakeholders as well.
 Proper risk management approach helps to make defense line by implementing
error free processes and by defining the project responsibilities
 The operational process could be eventually tracked with the help of risk
management process and even the prompt risk notification and instigation of
events become easier with the help of risk management process
 The issues with cost, time and process scope can be minimized through
developing accurate risk management approach
2. Identification of different risks
Many risks are associated to water pipeline network development like the poor delivery
channel, quality of water etc. Before mitigating the risks the risks are needed to be identified
accurately. In order to run the project success the main factor that is to consider is the physical
factors such as the diameter of the pipeline, quality of the pipeline, protection taken for the
pipelines and the materials used to build the pipelines. The architects are responsible to build the
pipelines properly to avoid unwanted chemical contamination and operational issues (Mayer and
De Smet 2017.). Many unknown facts could be identified and resolved with the help of the risk
management technique. Different available approaches related to the risk identification become
possible and easier by following certain processes. With respect to risk identification, analysis

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and evaluation the risks could be treated very easily. Many different techniques are there such as
fault tree analysis, event tree analysis, hazard and operability studies, transmission path analysis
etc those could be adopted to manage the raised risks.
Risk factors for failure Types Impact of the risks Probability
Environmental factors  Type of the soil
 Risk with the water
level
 Everyday traffic
Environmental factors
are the most important
factors those are
needed to be analyzed
accurately by the
project development
group. It will help both
the project manager
and the team members
to identify the risks and
their associate
management
approaches.
Environmental factors
are those factors that
cannot be managed
easily but could be
reduced. Such as
High

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optional water supply
channel can reduce the
issues of pipeline
traffic. In addition to
this, before developing
the water pipeline the
water level should be
checked and respective
soil type must be
analyzed to minimize
this issue.
Physical factors  Diameter of the
pipeline
 Material used for the
pipeline
 Age of the pipe
 Protection for the
pipeline
The pipeline through
which the water is
expected to be supplied
is required to be
manufactured with
experienced architect.
The diameter of the
pipe will help to
manage the water flow
and with changing time
the pipe must be
changes or repaired. In
High

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addition to this, it is
known that, chemical
reaction can harm the
pipes thus proper
protecting materials are
needed to be used in
the outside of the
pipelines.
Operational factors  Rate of breakage
 Hydraulic factors
 Quality of water
 leakage
In order to accomplish
the water pipeline
network developing
project successful, it is
necessary for the
developers to consider
the hydraulic factors
and water quality as
well. Proper protection
mechanism would help
the water and water
delivery approach
much significant and
accurate as well. Even
if pipeline leakage
Medium

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occurs then for that
also the time to time
maintenance is needed
to be considered.
Post failure factors  Maintenance cost
 Surrounding damage
 Production loss
 Disruption for traffic
Not only during or
before the pipeline
network development
but also even after the
development of the
pipeline network
failure might occur. In
order to maintain the
post failure risk factors
the project manager
and the network
developers should
consider an amount of
additional cost for
managing the
surrounding damage,
traffic disruption and
production loss as well.
It helps the project
Low

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manager to gain
effective and efficient
success after the
evaluation of the
project in the real
application filed.
3. Risk management techniques and risk treatment
3.1 Risk management processes and procedures
Based upon the needs and requirements of the individual companies and projects the risk
management which is a multistage process varies respectively. However, implementation of
proper risk management helps to provide exact resultant to the consumers. Four basic steps for
risk management include the following:
Avoidance: This is referred to as one of the earliest ways to mitigate risks either for any
project or for any entire company (Melchers 2001). Different unwanted activities could be
completely stopped after the usage of the risk avoidance technique in the project implementation.
It should keep in mind that, though for every business the risk avoidance is not a realistic
technique to be applied.
Risk reduction: In order to avoid different essential risks, this is another approach for
the companies or project developers. It cannot eliminate the risks completely but it could
minimize the risks while implementing or evaluating any project in the real field of application.
Based on the project potentials the risk reduction strategies are required to be considered by the

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project managers. If it is found that for applying the risk reduction approach the weighted project
budget is exceeding then, the project manager must think twice, before implementing it in the
real field.
Risk transfer: This is one of the smartest approaches for eliminating risk from any
engineering project. In this approach the risks are transferred to another party. Comprehensive
business insurance could be bought to avoid these kinds of risks (Vesper et al. 2016). The project
manager makes sure that with the help of the risk transfer approach, the developers would be
able to manage the eventually occurring negative and positive impacts.
Risk acceptance: This of the least using approach for risk management. With the help of
this risk management approach the negative risk impacts are unexpectedly started acting. It has
been found that, companies and projects face highest rate of risks, if the risks are accepted
because, in this case the project managers does not care about the potential risks and running
business losses as well. It is important for any business risk management to undertake and
business objective and en even handed approach. In other hand definitely the project manager
should never understand the vulnerabilities (Dias 2017). Project liability insurance is referred to
as an important for risk management.
However, these are the four basic of risk management approaches but after studying the
details of this particular project it is defined that, for the engineering asset based risk
management approaches there are some professional management approaches are available and
these are as follows:
Fault tree analysis: In order to maintain the system reliability, maintenance, safety of
any network development project the most widely used risk management technique is the fault

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tree analysis approach. This particular approach was first initialized in Bell laboratories. It is a
combined approach which helps to detect the issues associated to hardware, software and even
human error also. At a system level analysis it also helps to eliminate the issues of undesired
events (Boyko et al. 2017). This is a deductive analysis which starts from the general conclusion.
This is basically done by developing a logical diagram considering the specific reasons for which
the issues are occurring. This particular risk management approach is also known as top down
approach because the risk is managed starting from the final conclusion and finally reaches the
top most component. Before the occurrence of the failure this approach helps to define the risks.
Thus, if this particular risk management technique is applied then all the associated issues are
expected to be minimized (Shepherd 2016). With the help of these calculations the system based
qualitative reliability and maintainability failure can be repaired. However, for the development
of water pipeline network development project this logical gate tree diagram representation is not
at all helpful.
Event tree analysis: Event Tree Analysis (ETA) is referred to as one of the most widely
used analytical techniques which is generally used for evaluating different processes those are
expected to lead the project towards major level of risk. This particular risk analytical approach
was developed mainly for the request of the nuclear industries (Melchers 2001). This risk
management approach is almost similar to the fault tree analysis but a small part of difference is
there, that is in case of FTA the faults are observed but in case of eta the event those might lead a
project towards failure are also analyzed accurately. ETA is used in general practices to describe
series of numbers of practices associated to the security system. In order to reduce the
consequences of the business project this particular approach is not helpful at all. While
analyzing the project details it is defined that for the development of water pipeline network, this

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approach is not accurate. Rather it can be said that for evaluating the risks of the water pipeline
project this approach is not profitable.
Failure modes effects: Failure modes effects analysis is referred to as one of the most
efficient potential failure modes analysis approach. This critical analysis helps to define the issue
and its respective mitigation approach. Basically this is a step by step process that is used for
defining the possible failures in the project design, manufacturing and process assembly. Even
the issues associated to the products and services this risk management technique is very much
helpful (Curkovic, Scannell and Wagner 2013). Failure modes are those identified failures which
have been failed to meet their requirements. Failure in project modes might lead an entire project
towards major level of failure. This failure could even affect the consumers and the project
owners as well. In order to gain competitive advantages and even measurable success this kind of
risk management approaches are very much helpful.
Through the help of effect analysis the consequences of those risks can be analyzed and
highlighted and even its negative effects could also be checked. In order to prevent these failures
this particular risk management technique is used. Even the ongoing management operations and
the processes could even be analyzed and checked for minimizing the risks. At the development
and designing of conceptual phase for implementing continuous improvement this risk
management approach stands very much helpful (Mayer and De Smet 2017). FMEA approach is
generally used in the industries like aerospace and automation etc. Thus this particular risk
management approach is not that helpful for the water pipeline network or channel development
project. However, the situation on which this approach could be used is as follows:

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 After the deployment of quality function of any project in terms of process,
products quality and services then that phase this particular risk management
technique could be used eventually.
 It could be used if certain existing process, product and services are defined to be
reused by the project developers.
 This risk management technique could also be used before the development of a
control plan either for a new or for a modified process
 For any existing process, services and products if improvement plans are
developed then at those phases for avoiding the risks this technique could be used
by the project developers
 If during the analysis of a process, project and or even service, failures are
identified then for analyzing those failures the FMEA risk management technique
is very much helpful (Curkovic, Scannell and Wagner 2013)
Thus it can be said that for managing the risks of water pipeline network implementation
this particular approach is very helpful.
Hazards and operability: The operability issues and the hazards issues could be identified
and mitigated with the help of this risk management technique. From the already designed intent
the reasons for which the plant or the project might deviate are also analyzed and resolved with
the help of this technique. The success and failure of any project is dependent on different factors
and the factors are as follows:

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 For the basic of any study different data are used by the management. The
completeness and the accuracy for drawing the project are the factors to be
considered before using this particular risk management technique.
 The skills and experiences of the project team members are the other factors those
are needed to be considered by the management before the implementation of this
particular risks management technique (Shad and Lai 2015).
 The identified risks are referred to as the very serious one and thus, the capability
of the project team members are very much helpful to be considered before the
implementation of such risk management approach of an engineering risk
management technique.
 In order to minimize the identified hazards the ability of the project team is very
much important if it is defined that the project team members are unable to make
the required changes then this kind of risk management approach will not stand
effective at all.
The leading terms those are used for the risk management approaches study notes,
intention, deviation, consequences etc. After analyzing the details of this particular project this is
defined that this risk management technique could be used by the project manager for mitigating
the project risks (Scannell, Curkovic and Wagner 2013). However, certain accurate steps should
be sequentially arranged so that the risks can be resolved from the water pipeline development
project and the necessary steps are as follows:
 The project details, purposes, objective and scope of the project is needed to be
identified by the project manager

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 Based on the previous knowledge and skills of the associates the team members
are required to nominated by the project executives
 The study details of the conceptual design of the pipeline should be studied by
both the project manager and other project team members. In addition to this, for
each activity the accurate relevant parameters are also needed to be highlighted by
the project manager and team members.
 Proper reviews generated for the project details must be carry out by the project
manager
 The project executives must record the project details in a timely manner to
ensure that the issues are getting resolved
Transmission path analysis: Any project is consists of different phases such as project
planning, initiation, execution, monitoring and implementation. These are the respective phases
those are necessary for the project managers to follow to implement the water pipeline network
project successfully. Transmission path analysis is referred to as a test based rather simulation
based process that allows the project manager to trace or follow the source to identify the
provided location of the receiver (Podger et al. 2014). However this risk management approach
is used for the electronic projects thus for this particular project this risk management approach
is not at all beneficial.
Examination of software methodology: The risk management techniques differ for
different projects. If the project is software based then software development methodologies
must be analyzed accurately for implementing the software project successfully. Agile software
project development methodology is the most widely used process. However, whether the
software project is successful or not is defined by the help of proper risk management technique.

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Through examining the software methodology the issues of software project can be easily
minimized.
3.2 Risk treatment
Risk treatment is not a cost effective approach rather it helps to implement all the
effective risk assessment approaches for minimizing the risks. Based on the outline of the
project, the project manager should choose and prioritize the risk treatment approaches. Through
considering the risk mitigating factors not each time single but also combined treatments are also
found to be effective. The factors those generally affects the project implementation are the
social, financial, environmental, political factors. Instead of direct overall treatment each and
individual segments are needed to be treated firstly. In order to ensure the details of critical
dependencies the project managers must understand the risk treatment approach. One of the most
widely used risk treatment approach is the cost benefit analysis (Bharathy and McShane 2014).
With the help of cost benefit analysis, the unwanted situations and the project uncertainty are
expected could be avoided. Different risk treatment options are there, that helps to increase the
project flexibility and project reliability as well.
Considering the requirements of the project stakeholders the effective as well as
sustainable project risks treatments are needed to be adopted by the project managers. The
analytical gaps must be identified by the project managers and the stakeholders to avoid the
issues of budget overload and time extension as well (van der, Linde and Frankel 2015). The
primary concern for any risk is that after getting minimized whether it can be occurring or not. If
there is a further chance of occurrence the cost benefit analysis considering all the necessary
components stands the most beneficial thing for the project. A project will be treated as a
successful one only if it meets the stakeholder’s requirements and high revenue structure. The

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cost effectiveness of a project can only be analyzed then when the ROI is calculated as to be high
(Dias 2017). It means that if it is found that the investment done for a project is lower than the
profit coming from the project then only the project would be rated as a beneficial one.
Project risks could be treated accurately by using four different techniques such as risk
containment, risk transfer, risk elimination and risk reduction. All of these approaches are very
much difficult but proper application would help the project owners to lead towards the business
and project needs.
Project risk management is referred to as a process of risk identification, analysis, and
then respective response to the risks. This is basically a cyclic process which is very much
important to be identified to mitigate the risks those have been identified by the project manager
and the project team members. The project is focused to development of water system inventory
expansion by identifying both the data assets and the risks that might hamper the general process
flow of the project (Vesper et al. 2016). The water pipeline network project has three significant
phases and each of the phases such as pipeline network development, pumps and water
distribution facility consideration. With the help of proper risk treatment approaches the issues of
this project could be completely minimized.
The main issues are expected to be generated while developing plan for distributing the
water through the water supply chain. The purpose and functionalities of the water supply
pipeline channels is dependent upon the higher level of inventory. The issues or risks might rise
while developing the systematic approach of concept for inventory development. Risks,
consequences for individual events are the basic terms that are associated to any project. The
people who gets affected either negatively or positively by the risks are the project stakeholders,

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interested parties (Dallas and Director 2013). In order to avoid this kind of issues the common or
basic components those are helpful include paper communication plan development and risk
treatment plan development. Before the occurrences of the risks the project executives are
needed to highlight proper treatment plan those will have the ability to resolve those risks.
3.3 Risk management and organizational culture
It has been found that risk management organizational culture is complimentary
components for risk management. The key components of any risk management project helps
to identify define and access the culture of the business organization (Boyko et al. 2017). The
different project risks those generally affects the stakeholders include the following:
 Safety of the consumers, employees, community
 Environmental risks
 Business risks
 Financial risks
 Physical risks
 Technical and commercial risk
 Government risks
In order to measure the organizational culture these risks are needed to be analyzed and
managed accurately.
3.4 Identification of standard of risk management
This part of the paper analyzes the outline of the value for developing an explicit
commitment for the implementation of risk management in terms of a core value for the water
pipeline network project. Regardless of size and importance of risk any project manager is

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responsible to eliminate that risk to implement a successful project for their stakeholders (Mayer
and De Smet 2017). Development of proper risk management plan which is aligned with the ISO
31000:2009 is completed through considering the preliminary objective to achieve the project
objective successfully. This is done to ensure that the risk management approaches are available
for all the analysis levels. Starting from the project owners hierarchically the lowest level
stakeholders re also needed to be aware of the project details and its respective risk management
approaches. In the way of organizational success many time different factors come those
interrupts the flow of the organizational values (Hopkin 2017). The standard called ISO
31000:2009 provides the project team members an alignment in term of proven, robust, stable as
well as manageable risk mitigating approaches. The different standards of risk are as follows:
Focus of the
strategies
Details Standards Basic challenge
Entrepreneurial
objective
In order to improve
the organizational
risks this kind of risk
management
approaches are
adopted by the
management heads
ISO 31000:2009
BS 3100:2008
COSO:2004
FERMA: 2002
The challenges for
all of these risks are
similar by nature.
This approach blend
the business
strategies by
different similar
elements those are
defined in the risk
maturity models
Project compliance and
control objective
It helps to ensure the
project team members
about the transfer and
primary risk
OCEG: “Red Book”
2.0:2009 COSO: 2004

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mitigating approach
Regulatory
management
It helps to mitigate
risks through serving
accurate evidence at
the managerial level.
SOLVENCY
BASEL
Risk prioritization is important because it helps to eliminate the negligible risk and only
point out those risks those are needed to be mitigated from the project outline (Boyko et al.
2017). After analyzing all these risk an accurate risk analysis matrix should be developed and on
the basis of the risks a risk management framework must be implemented by the management
head to resolve all the highlighted issues.
Conclusion
From the overall discussion it has been found that in Dubai (United Arab), the water
supply industry is facing huge challenges while developing network for supplying water to
throughout Dubai. After analyzing the details of engineering asset management it is defined that
risk might expand for financial, market loss and business continuity as well. Therefore, a level of
residual risk should be considered as a standard for the development of the risk management or
risk treatment policies. Based upon the imperative studies, it is determined that, inadequate water
supply is a major issue in allover Dubai. The highly developing requirements of the residents are
interrupting everyday because of the financial and technical constraints. The characterization and
qualifying of the total level of water loss in Dubai is referred to as a critical task. The water
supply network development industry is statistically calculating the total amount of loss with the

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help of secondary data analysis. In addition to the risk identification and risk assessment
different risk mitigating techniques are also elaborated in this report under the context of
engineering asset assessment. In order to develop such risk mitigation strategies for the w3ater
supply network development both qualitative and quantitative data are collected under the
guidance of local expert team.

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