Operational Risk Management for Any Crisis

Protect your operations against potential threats before they become real issues

Overeview

Running a successful business in today’s fast-paced environment requires much more than just having an excellent product or service. You also need resilient operations and efficient processes to consistently deliver value to your customers. However, even the most well-run organizations can encounter issues that slow things down or bring them to a grinding halt.

That’s where a strong operational risk management program comes in. This involves methodically identifying potential vulnerabilities in your day-to-day operations, thoroughly assessing the likelihood and potential impact of those risks, and then developing robust strategies to proactively mitigate and manage that risk.

The goal is to build resilience, stability and redundancy into the very DNA of your business systems. This means that when disruptions or setbacks inevitably occur, productivity and service levels are not severely impacted. Your operations can rapidly recover and adjust as needed. With effective operational risk management, your company becomes an adaptable, agile business machine ready to power through whatever challenges come your way.

Benefits

There are several compelling benefits to implementing a formalized operational risk management program:

  • Minimizes business interruptions – By diligently pinpointing risks ahead of time, you can thoughtfully develop contingency plans and safeguards to minimize disruptions when issues ultimately arise. This prevents minor hiccups from cascading into major operational failures.

  • Maintains steady productivity – When unforeseen disruptions are rapidly contained, staff can keep working with minimal downtime. This consistency keeps your operations humming along at peak productivity.

  • Reduces costs – Outages, stoppages and operational mistakes are extremely costly. Expenses swell from lost revenue, dissatisfied customers, delayed orders, overtime labor, regaining market share and repairing damage. Effective risk management dramatically lowers expenses by avoiding these costly scenarios.

  • Improves regulatory compliance – In regulated industries, demonstrating an operational risk management program is crucial for compliance. A mature program indicates to regulators that your organization takes these issues very seriously.

  • Enhances organizational resilience – The ability to rapidly recover and bounce back from external threats is critical in today’s world. Risk management boosts this resilience across people, processes, data and technology infrastructure.

  • Creates competitive advantage – By diligently managing risks, your business can respond faster, smarter and more flexibly than competitors when disruptions inevitably emerge. This builds trust and loyalty with customers.

 

In essence, operational risk management provides the foundation for an agile, resilient company ready for whatever comes its way. Let’s now explore the details of this critical capability.

Service Details

Our operational risk management services are customized to fit your organization’s specific needs, but generally include these core components:

 

Comprehensive Risk Identification

We meticulously analyze your business to pinpoint potential vulnerabilities and risks in your operations. These could include:

  • Supply chain risks – Disruptions with suppliers, inventory or raw material shortages, shipping and delivery delays or failures.

  • Process risks – Inefficiencies, bottlenecks, manual procedures prone to human error, gaps in workflows.

  • Technology risks – Hardware failures, software bugs and crashes, data breaches, lack of backup systems and redundancy.

  • External risks – Utility outages, natural disasters, pandemics, geopolitical factors, compliance shifts.

  • People risks – Loss of key staff, inadequate training, fraud, cultural issues.

 

Rigorous Risk Analysis

Next we evaluate each identified risk based on:

  • Likelihood – How probable or frequent is this risk reasonably expected to be? What vulnerabilities make it likely?

  • Impact – What level of potential damage does the risk realistically pose, both quantitative and qualitative?

  • Detectability – How well can emerging signs of the risk be spotted early via metrics, indicators or triggers?

 

This level of granular analysis clarifies where to focus risk management efforts for greatest impact.

 

Targeted Risk Mitigation

With risks thoughtfully prioritized, we work collaboratively with your team to develop pragmatic action plans to address them, such as:

  • Implementing redundancy in supplies, infrastructure, staff skills.

  • Improving monitoring and controls around high-impact processes.

  • Establishing staff training on contingency protocols and emergency response.

  • Upgrading outdated legacy technology infrastructure.

  • Building in slack, flexibility and workarounds to adjust to disruptions.

 

The goal is to implement affordable, optimized measures that inject stability and resilience into operations.

 

Continuous Risk Monitoring

Finally, we establish rigorous monitoring of key risk indicators so emerging vulnerabilities are spotted early before escalating. This includes setting clear communication protocols and response plans for when early warning thresholds are breached.

Through this continual evaluation and visibility, risk management transitions from a one-time project into an integral business capability for resilience.

The Process

Our proven operational risk management methodology follows these key phases:

 

Planning

We collaborate with you to precisely define the scope, stakeholders, timeline, communication protocols, success criteria and metrics.

 

Comprehensive Risk Identification

Through workshops, interviews, facility tours, process mapping, and document review we shine a spotlight on areas of operational vulnerability.

 

Rigorous Risk Analysis

We thoroughly evaluate each risk based on likelihood, business impact, and detectability to objectively prioritize which demand attention.

 

Risk Evaluation

By examining costs vs benefits, we determine which mitigation strategies are feasible for priority risks. This focuses efforts on pragmatic solutions with material impact.

 

Targeted Risk Mitigation

Detailed mitigation plans are developed for managing the highest-priority risks across people, processes, data and technology.

 

Disciplined Implementation

Mitigation activities are rolled out across the organization, with progress closely tracked against timelines and budget.

 

Continuous Risk Monitoring

Ongoing monitoring procedures and key risk indicators are established to identify emerging risks proactively before they escalate.

 

Insightful Reporting

We provide regular reports to stakeholders on risk management activity, changes, recommendations and measurable outcomes.

 

Renewal and Updating

Existing risks are re-evaluated and mitigation activities fine-tuned to keep pace with your evolving business landscape.

FAQ'S

What types of operations can you help assess?

Our risk management methodology is proven across nearly any industry or department. Common areas we review include:

  • Production and manufacturing

  • Supply chain and logistics

  • Transportation fleets

  • Facilities management

  • IT systems and data infrastructure

  • Finance and accounting

  • Sales fulfillment

  • Customer service

  • Human resources

  • Legal and compliance

The duration depends on the size, complexity and maturity of your operations. For small businesses, targeted risk management can be implemented in 4-6 weeks. Larger global enterprises often establish ongoing risk programs that continually revisit risks each quarter or twice a year.

If key risk indicators breach defined thresholds, this triggers predetermined response protocols ranging from notifications to leadership through activating business continuity plans or crisis response scenarios. The key is quick identification and escalation.

We thoroughly analyze your suppliers, procurement processes, inventory management, logistics and fulfillment to identify potential bottlenecks or single points of failure. Mitigation strategies may include expanding supplier base, improving end-to-end visibility through digital tracking and building in transportation redundancies.

Absolutely not – risk management should be an integral, ongoing business capability. New risks constantly emerge and existing ones evolve. Regular identification, analysis, mitigation and monitoring is crucial for sustaining resilience as the business landscape changes. We provide both targeted projects and ongoing managed services.

While there can be some overlap, cybersecurity focuses specifically on information technology vulnerabilities. Operational risk management encompasses the full spectrum of people, process, infrastructure and external risks across the business.

Where process gaps contribute significantly to operational risks, we can conduct targeted process redesign – optimizing workflows, reducing duplication, clarifying responsibilities. Improved processes then help manage risks.

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Axeligence is headquartered in Israel and operates in more than 40 countries worldwide.

Our global presence allows us to provide local insights and intelligence in any market or environment.

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