Risk-Based Planning in Transportation Asset Management: Critical Pitfalls

Abstract

The 2012 transportation bill, Moving Ahead for Progress in the 21st Century, formalizes the application of risk management in transportation asset management decision making. The bill requires departments of transportation to have a formal risk management plan for the national highway system. When carried out successfully, risk planning can be a very powerful framework to effectively and efficiently manage transportation infrastructure. However, if there is lack of experience with and insight into risk planning, it can go wrong, leading to a counterproductive plan that contributes to ineffectiveness and inefficiencies in the organization and transportation system and to wasted resources. This paper reviews a broad spectrum of literature on risk methods and applications to identify and discuss some common pitfalls—failure to communicate, failure to monitor, proportionality, failure to involve knowledgeable individuals. It synthesizes the results for purposeful use in transportation asset management decision making. The literature review indicates that pitfalls are pervasive and usually familiar to the new generation of industries adopting the principles of risk in their management practices. Accordingly, the paper recommends that decision makers and analysts become more familiar with these pitfalls before embarking on risk implementation programs.