Risk management is not just about the product. It is also the helicopter perspective of Your company risk

I have previously mentioned risk management – or risk analysis – with focus on product-, process-and consumer risk.

But any (quality) management system requires a general risk-based approach in all matters.

This starts with you company strategic risk analysis where You need to consider threats and opportunities for the company but also dribbles down through the organization as the management is required to promote a process-oriented and risk-based mindset.

What does that really mean?

The first point about threats and opportunities is Your grand view of the company and the possible future event that could have a great impact on Your business.

On a grand scale this could be questions like these: Do you have a plan if Your primary supplier goes out of business? Do You have a plan if there is a pandemic? Can You see an emerging market none of Your competitors have noticed?

Bringing questions like these a bit further down, look at you value stream and see where you have the greatest risk.

Quite often focus is on processes where You create value. This is the interesting part of the business and where procedures and controls are streamlined and up to date. Unfortunately, this can reduce focus on the “less important” processes but what if the major risk is in one of these?

If Your supplier goes out of business, all the value-adding production stops and no good procedures and OEE calculations can get it up and running again.

One way to prevent this is starting an initiative to search the market for options, or buying Your supplier, or build a safety inventory or something else.

The important thing is that You turn the risk-based insight into action that can mitigate that risk. That the action is actual activities in the organization where everybody understands the importance and the purpose of the initiative.

Good risk management starts at the top, getting the greater picture and then let it work its way down to operational activities that will improve You situation in the future.

There will be more about this topic soon, so stay tuned.

In the meantime, have a look at my other interesting posts about process validation, sample size determination and product risk analysis here.

For more information please contact EpsilonPlus here.