To maximize the value of their physical assets and make them provide the highest ROI they must have an accurate understanding of their assets and the risks they pose. Without a strong knowledge of the risks companies could make ill-informed decisions that ultimately harm their bottom line. Insufficiently implemented process for managing risk and assets can also leave organizations exposed to costly fines and penalties from regulators or loss of profits because of insufficient planning for the unexpected.
The most prevalent and significant problems with managing risk and assets include:
Unawareness of the capabilities the assets of an organization – For instance, employees may not be official site aware that a piece of equipment can perform a job outside its designed range or know how to use it to its maximum efficiency. This can lead to underutilisation of the asset and diminished ROI throughout its lifecycle. This can be minimized by ensuring that employees are educated to know the capabilities of an asset and how to use them appropriately.
A lack of a comprehensive process for managing risk – The continuous stream of compliance demands that have flooded into the industry since the financial crisis has left many companies with no time to consider strategic risk factors. This has resulted in inadequate risk management strategies, inaccurate risk assessments and missed opportunities to optimize an organization’s assets.
Third-party risk – From cyber security to integrity of data, and reputational damage can have significant implications for an organisation. To mitigate this type threat, a thorough verification process involving failsafe procedures should be implemented to ensure that all vendors have been recognized.