LACMTA Highway Program
Risk Management Framework
Los Angeles County Metropolitan Transportation Authority (LACMTA)
Los Angeles, CA
Risk Assessment and Risk Management
Metro Measure M Highway Projects
SHA Analytics, LLC is working with Metro’s Highway Program to develop a risk assessment process to be applied to all projects and integrating this with Metro’s agency-wide Active Risk Manager (ARM) system. Risk assessment and risk management are project management best practices. Working with Metro, we have developed a process to identify risk assessment needs based on project attributes. In order to create a scalable approach to risk assessment and risk management for Metro’s highway projects, we developed a pilot process to evaluate and screen projects. Central to this process is a risk assessment questionnaire to be completed early in a project’s development. The intent of this questionnaire is to provide a high-level assessment of the overall project risk level in terms of Low Risk, Medium Risk, or High Risk.
The scalable risk assessment approach for the project will be determined by the overall project risk level in conjunction with the project’s cost and whether or not it is a FHWA Major Project. Based on the project characteristics the appropriate level of risk assessment is determined. A project may go through a qualitative risk assessment, a quantitative risk assessment, a quantitative risk analysis including Monte Carlo simulation, or the FHWA Cost Estimate Review process.
For any level of risk assessment, risk assessment activities are aligned with key milestones in the project development phases from the Project Initiation Document through Construction. The benefits of risk assessment are greatest when the process beings in the early project development phase. Beginning risk assessment early allows the greatest ability for risk management and for improving project contingency budgeting. To assist in the risk assessment activities we have developed a risk register structured by project development phase in both qualitative and quantitative formats.