Operational risk tries to identify and manage risks for people, processes, and systems; it is a discipline and behavior that needs to be put in place. As such, a framework to control the process is recommended. The framework is a set of integrated tools, processes, and mitigation strategies that assists a company
in managing, measuring, and monitoring operational risk.
- Visibility, Optimization, and
In this blog we will discuss the visibility portion of the visibility and optimization process.
A manufacturing operational environment consists of people, processes, and systems working together to support the organizational goals in an efficient and effective manner. Operational Risk Management supports these goals by putting in place controls to address the risk within the organization. Once the controls are in place, the processes must be periodically re-evaluated to ensure their effectiveness. Workers and managers at every level must fulfill their respective roles to assure that the controls are maintained over time.
Each level of the organization has different needs regarding timing, granularity, and relevancy of the information. This visibility into the organizations activities results in an increased awareness of potential hazards, the effectiveness of mitigation strategies, and the effectiveness and compliance with the organizations policies, limits, and controls. The identification and monitoring of performance indicators expose the amount of operational risk within the organization at any given time and enables the organization to gain awareness of the most risky activities and processesto monitor and mitigate risk at each level of the organization.
Figure 1 Example Screens for Visibility
This posting is the twelfth 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 just joining this blog here are links to the earlier postings
Part 6:ORM- Framework – Governance
Part 7 ORM- Framework – Planning
Part 11ORM Framework – Execution