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Chapter 31 Formal Safe@ Assessment Applied to Shipping Industry        565

                  In a cost benefit analysis the costs associated with the risk control option or package of options
                  are estimated considering both  public cost  (enforcement,  inspection, etc.)  and  commercial
                  sector  cost  (e.g.  capital cost,  compliance cost,  etc.).  A  similar  exercise is  undertaken  to
                  estimate benefits, which for ships may include reduced environmental cleanup costs, increased
                  vessel  life,  the  value  of  saved  lives,  etc. The net  present value  of each option or option
                  package is calculated by subtracting the benefits from the costs. Sensitivity analysis may be
                  conducted around key assumptions to estimate the level of confidence that can be attached to
                  the computed net value of each option package. Risk control options may be ranked based on
                  their cost-effectiveness. The final step in a formal safety assessment is “decision making”,
                  which gives recommendations for safety improvement. The selection of risk control options
                  for the decision-making is based on the cost-effectiveness and the principles of ALARF’ (As
                  Low  As Reasonably Practicable). Intolerable risk  shall be  controlled regardless of  costs.
                  “Reasonable” means that the costs are to in gross disproportion to the benefits.

                  31.4  Human and Organizational Factors in FSA
                  IMO (1 997) recommends a balanced approach between human and technical factors reflecting
                  their contributions to the safety of the overall system considered. IACS (1999) proposed Draft
                  Guidance on  Human  Reliability Analysis (HRA) within Formal Safety Assessment (FSA).
                  The HRA guidance was developed to assist the incorporation of HRA in the FSA process. It
                  provides references and summaries of various HRA techniques.
                  The majority of ship incidents and accidents appear to have a human factor component, e.g.
                  error in loading, error in operating machinery, etc. It is therefore necessary to integrate the
                  human and organizational factors (HOF) into the FSA. To this end, it is essential to  include
                  HOF expert and operational experience in FSA team.
                  The consideration of HOF can be done in one of two ways.  The first and probably the less
                  difficult  way  is  to  treat  human  behavior  at  a  phenomenological  level,  to  determine the
                  probability of an improper human decision (behavior) to be made with respect to each one of
                  the  critical  aspects  of  the  operation.  The  second  and  more  difficult  way  involves  the
                  underlying causes of the improper human decision. The following example is used to illustrate
                  the first approach.
                  In a shipboard fire, many of the initiation probabilities may be a direct result of humans, like
                  smoking. Humans may also affect the progress of the fire, by fighting it manually or using fire
                  suppression equipment. Such influences can be  incorporated in the FSA.  For  example, the
                  effects of humans on fire initiation may be implicitly included in the actual historical data.
                  Differences in crew training and safety discipline may be accounted for by using different
                  probabilities assigned to the event tree in the risk analysis. Human errors of commission or
                  omission can also be similarly incorporated. However, it is generally very difficult to quantify
                  the effects of different human and organizational factors accurately.


                  31.5  An Example Application to Ship’s Fuel Systems
                  The above mentioned Formal Safety Assessment method can be applied to the ship’s fuel
                  system to  identify appropriate risk  control measures that reduce the potential for fire and
                  failure or to mitigate the consequence.
                  A possible approach starts with the description of a generic ship fuel system. This consists of
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