Creating Stakeholder Value through Risk Mitigation Measures in the Context of Disaster Management
2. Objective, Materials and Methods
- How do the concepts of value creation and disaster management interrelate?
- How can the benefits of risk mitigation measures for various stakeholders be realized?
- Include only peer reviewed scientific journal articles
- Ensure relevance by selecting articles that contain at least one keyword in their title or abstract
- Exclude articles with very narrow aspects or context (e.g., suitable only for a single case)
- Read remaining abstracts and ensure their relevance to the subject
- Further, read remaining articles in their entirety to ensure relevance of content
3. Literature Review: Comparing Value Creation and Disaster Management Processes
- Absolute profitability is achieved if the total cost of an investment (e.g., risk mitigation measure) is lower than the total cost of rejecting it.
- Relative profitability is achieved if investing (e.g., implementing a risk mitigation measure) results in a total cost that is lower than that of other options under consideration.
- people’s way of life
- political systems
- the environment
- people’s health and wellbeing
- personal and property rights
- people’s fears and aspirations.
4. Creating Stakeholder Value through Risk Mitigation Measures
- Benefits of the risk mitigation measures in economic, environmental, and social termsThe environmental dimension, the natural environment: “a cleaner environment”, “environmental stewardship”, “environmental concerns in business operations”.The social dimension, the relationship between business and society: “contribute to a better society”, “integrate social concerns in their business operations”, “consider the full scope of their impact on communities”.The economic dimension, socio-economic or financial aspects: “contribute to economic development”, “preserving the profitability”, “business operations” .
- Impact of the risk mitigation measures on reliability, availability, and maintainability of electricity distribution networkReliability is the ability of a system to perform a required function under given conditions for a given time interval. Availability is the ability of an item to be in a state to perform a required function under given conditions at a given instant of time, or in average over a given time interval, assuming that the required external resources are provided. Maintainability is that aspect of maintenance that takes downtime of the systems into account .
- Life-cycle cost (investment and operating costs) of the risk mitigation measuresLife-cycle cost is the total cost incurred during the life-cycle of an RMM including both investment and operating cost .
Conflicts of Interest
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|Characteristics||Disaster Management||Value Creation|
|Description||The range of activities designed to maintain control over disaster and emergency situations and to provide a framework for helping those who are at risk to avoid or recover from the impact of the disaster [55,56].||A process that provides more novel and appropriate benefits than target users currently possess, and that they are willing to pay for .|
|Aim||Reducing (avoiding, if possible) the potential EWE impacts on CI, assure prompt and accurate assistance during the EWE, achieving rapid and durable recovery, business continuity, facilitating decision-making, increasing stakeholder wealth.||Focus on economic profitability, but lately also on societal and environmental value, investment decision-making (risk mitigation measures), financial situation and standing, company success.|
|Research disciplines||Risk management, reliability engineering, insurance, management, psychology.||Management accounting, finance, service research, marketing.|
|Elements||Hazards, losses, tangible and intangible impacts, resilience, vulnerability, dependability, uncertainty, probability, consequences, risk.||Cost, profit, value, benefit, sacrifices.|
|Methods and models||Hazard models, vulnerability models, loss models, methods for capacity, capability and resource management.||Investment appraisal, impact assessment, value propositions, service concept models.|
|Stakeholders||All stakeholder groups of the society. Decision-makers at all decision-making levels: local, regional and state authorities, EU institutions, public organisations, private companies and citizens.||All but focus typically on private companies ability to create value and on creating economic value to shareholders.|
|Critique||Focusing on negative impacts.||Challenges and ethical implications related to the valuation of intangible impacts, e.g., economic valuation of life.|
|Overhead line placement||Adjacent forest management||Situational awareness||Distributed generation|
|Underground cabling||Inspection of the network condition||Cooperation and lending arrangements||Micro grids|
|Coating of conductors||Contingency plans|
|Regular aerial inspections||Emergency power systems|
|Network structure modifications||Smart grids|
|Preparedness of households|
|Mutual planning and training|
|Preparedness: Mutual Planning and Training||Underground Cabling (Weather-Proof Network)||ICT Solutions (Technology, Systems)||Forming and Disseminating Situational Awareness (Method)||Up-to-Date Contingency Plans (i.e., Critical Points of Consumption Listed, Increasing of Preparedness Level etc.)||Adjacent Forest Management, Sufficient Vegetation Clearance Resources (Weather-Proof Network)||Backup Power|
|Economic, environmental and social benefits of RMMs |
|Impact of the RMMs on RAMS* of electricity distribution network |
|LCC (investment and operating costs) of the RMMs |
|Total (weighted) |
(Benefits: 42%, RAMS: 37%, Life-cycle costs: 21%)
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Räikkönen, M.; Molarius, R.; Mäki, K.; Forssén, K.; Petiet, P.; Nieuwenhuijs, A. Creating Stakeholder Value through Risk Mitigation Measures in the Context of Disaster Management. Infrastructures 2017, 2, 14. https://doi.org/10.3390/infrastructures2040014
Räikkönen M, Molarius R, Mäki K, Forssén K, Petiet P, Nieuwenhuijs A. Creating Stakeholder Value through Risk Mitigation Measures in the Context of Disaster Management. Infrastructures. 2017; 2(4):14. https://doi.org/10.3390/infrastructures2040014Chicago/Turabian Style
Räikkönen, Minna, Riitta Molarius, Kari Mäki, Kim Forssén, Peter Petiet, and Albert Nieuwenhuijs. 2017. "Creating Stakeholder Value through Risk Mitigation Measures in the Context of Disaster Management" Infrastructures 2, no. 4: 14. https://doi.org/10.3390/infrastructures2040014