Some factors generating operational risk: Internal...

former_member182149 · ‎2013 Jan 24

Many factors can influence operational risk. One of the most important is one that can be overlooked in the concentration and the glamor of building and designing process and systems. That is the people who operated the processes and equipment.

The management of employee and contractor behavior can become a major source of operational risk. Poorly trained or overworked employees may inadvertently expose the organization to operational risk. Understanding the mandate, having confidence in their ability to execute, and knowing they respect the process for risk mitigation, as well as adherence to the organizations policies and strategies are essential for enterprise risk management. In addition the continuous availability of employees or the ability to replace them can influence the ability to recover from interruptions to the organizations normal business operations.

Thus, there is a need to integrate people with standard operating and risk management procedures to successfully implement an Operational Risk Management approach; ensuring that the enterprise develops and supports a culture of safety.

This culture of safety has to apply not only to your own employees, but to everyone else who is involved in your business. The safety culture must include everyone from your staff, to visitors to the site, vendors who are delivering, service providers on site, consultants, media, etc. Everyone must be aware of what is going and how their actions could have an impact on their own lives and well as the wellbeing of those around them.

Some of the common elements in keeping people aware are posting lost time statistics, starting meetings with a safety briefing, safety newsletters and quizzes, strict enforcement of the certification of operators.

Is safety embedded in your culture? Does it include everyone? What do you do to ensure that safety is on top of everyone’s mind?

This posting is the fifteenth of a series of blogs discussing various factors of operational risk management as it pertains to manufacturing organizations. Please feel free to comment and discuss this series

For those of you who are new to this series here are the links to earlier blogs in the series

Part 1:Are you heading for disaster by not managing your risk?

Part 2:Operational Risk Management (ORM), do I need it?

Part 3:Fines, Penalties, Safety Improvements, part of doing business or something to be avoided?

Part 4:Managing Risk – There is help out there.

Part 5:Operational Risk Management: A needed framework

Part 6:ORM- Framework – Governance

Part 7 ORM- Framework – Planning

Part 8ORM Framework – Planning – Process Risk and Assessment Analysis

Part 9 ORM Framework – Planning – Process Risk Control Measure Analysis

Part 10ORM Framework – Planning – Managing Changes and Updates

Part 11ORM Framework - Execution