 By Will Jennings, Senior Lecturer in Politics at the University of Southampton,
Understanding Olympic Risks
Major events such as the Olympics are both a magnet to and an amplifier of societal and organisational risks. The event itself can increase the likelihood and the potential impact of pre-existing hazards or threats, at the same time as creating its own unique set of risks. Whereas the construction of venues and infrastructure in the run-up to the Games can have adverse ecological impacts, generate occupational hazards for workforces, and entail financial risks for organizers, the influx of large numbers of people at the time of the event can be linked to the increased production of waste and pollution as well as congestion (e.g. road traffic, over-crowding on public transport and in public spaces) andconsumption of essential services (e.g. energy, water, healthcare). Host citiesface substantial financial risksdue to the huge sums of public and private investment that are involved (for example related to infrastructure and venue costs, broadcast and sponsorship contracts), legal liabilities (such as health and safety of competitors, workers and spectators, and contractual obligations) and threats to reputation. Businesses also face financial risks, either due to their expectation of Olympic-related revenues or potential for disruption to their operations (such as in relation to transport, workforce absenteeism, sales volumes) at the time of the Games.
The immovable deadline of July 27, 2012 is another potential source of risk inflation – as delay or postponement is not an option, leaving organizers vulnerable to last minute strike action or other unexpected shocks as the opening ceremony nears. An unrelated event such as the Icelandic volcano eruption of 2010 around the time of the Games could lead to widespread disruption andthe need for contingency planning. Other risks, such as petty crime or the increased transmission of (minor)infectious disease through higher volumes of international travel during the event, have relatively low-level impacts but nevertheless have potential to cause substantial disruption and inconvenience.
Highly visible and iconic public events with large global audiences also create a platform for malevolent forces. For some time, the Olympics has been a prominent target for international and domestic terrorism, as well as other forms of dissidence and protest, with acute sensitivity to this threat since the Munich Massacre atthe 1972 Olympics. Taking cues from the international security context, host cities have become increasingly attuned to the threat of terrorism since the events of September 11.Traditional forms of terrorism are not the only issue; for example, twelve million cyber-attacks per day were reported during the Beijing 2008 Olympics. In the run-up to London 2012 there has been concern about the threat from illegal betting syndicates, as an emergent risk that has made it onto the agenda of the International Olympic Committee. Threats from terrorism and crime can be linked to globalisation in its economic, social and technological forms as well as to domestic forces.
Planning for the Olympics
The extended lead-in time from the bid preparation to the post-Games legacy planning presents a particular challenge for risk assessments and risk management. To illustrate the changing horizon of risks faced by London 2012, it is possible to identify a number of critical risks that have become known or risks where the estimated probability has increased significantly since the initial feasibility studies for a London bid were conducted in the late 1990s. For example:
• The increased threat from al-Qaeda and decreased threat from Irish Republicanism.
• Scientific evidence of an elevated risk of a global pandemic (and the actual outbreak of the swine flu pandemic).
• Increased likelihood of extreme weather events associated with climate change.
• Risks for the Olympic programme posed by the effects of the global financial crisis on public finances and public services, investment from the private sector, and revenue from corporate sponsorship.
• Increased threats from illegal betting syndicates and organised crime (facilitated through global communication networks and technologies).
• Vulnerability to social unrest, demonstrated through the 2011 riots, with increased stress on policing and other emergency services due to cuts to the public sector.
Further to such emergent risks, Olympic planning is subject to a great deal of uncertainty due to the complex interdependence of multiple networks (e.g. telecoms, power, transport), sites (e.g. the Olympic Park, central London and the regions), and operational teams (e.g. police, fire and ambulance services, customer services, technical staff). While headline risks such as terrorism tend to attract most attention, an event like the 2011 riots demonstrates that unanticipated chains of events (such as the outbreak of unrest in a number of locations, leading police units from around the country to be deployed to trouble spots in London) can create vulnerabilities in an interconnected system (with rioters in other urban centres responding to the reduced policing capacity). These sorts of ‘system’ risks are exacerbated through network technologies such as social media, although the same technologies also enable faster and more efficient responses.
Managing Olympic Risks
While Olympic organizers have always engaged in the management of risk in some fashion, through the use of tools such as insurance, safety plans and command and control operations, since the 1980s Olympic organizing committees have invested increasing time and effort in teams and systems dedicated to the management of risk. In my forthcoming book, Olympic Risks (Palgrave Macmillan, 2012), I document how risk has increasingly been integrated into decision-making and operations, no longer being treated just as an input into the calculation of insurance premiums (traditionally in relation to personal injury and property cover) -- where risk mitigation was once upon a time conducted as an afterthought. Instead, the risk-based approaches to organisation of the Vancouver 2010 Winter Olympics and London 2012 Summer Olympics reflect the strong influence of the ideas and practice of risk management to Games planning.This trend is not just isolated to finance and security, but across the wide range of administrative functions undertaken by organizers, such as in construction health and safety, assessment of environmental impacts and public health planning. Further, the increasing sophistication of risk management in the Olympic context is an excellent example of how the wider discipline and profession of risk management has evolved over the past thirty years and taken on increasing importance for organisations in a wide range of fields.
Risk and the Future
The concept of risk is inextricably interlinked with a belief in the possibility of prediction and control of the future. While London 2012 might be said to be a‘risk-based Games’ in terms of its organisation, this cannot guarantee that the event will pass without minor or serious incident. Such possibilities remain uncertain because the probability of numerous threats and hazards are difficult to quantify and are matters for qualitative forecasting rather than a hard quantitative science of risk management. By construction, risk is a side effect of growth in the organisational scale, complexity and rewards of the Olympic Games.
Note: this research was funded by the UK’s Economic and Social Research Council (RES-063-27-0205). Will Jennings’ book Olympic Risks is published by Palgrave Macmillan and is available for a 50% discount until the end of July 2012 via http://olymponomics.wordpress.com/olympic-risks/
UK Email: w.j.jennings@soton.ac.uk
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