Business
5 Best Practices for Operational Risk Management

Managing risk prevents procedural failures from becoming tangible losses, like regulatory fines, penalties, and reputational loss. Operational risk management (ORM) protects your organization from potential threats and lessens the impact of an event, should one occur. This process involves detecting, analyzing, and mitigating risks, along with improving outcomes through better decisions.
Since risk is an inherent part of doing business, and human error is unavoidable, it’s necessary to have a strong operational risk management strategy.
Here are the 5 best practices for managing operational risk in your company.
- Use risk management software
Workiva highlights how an operational risk management tool is the first thing you need to successfully manage risk. It can be extremely difficult to thoroughly assess and mitigate risk manually because there are far too many nuances and details to track. Plus, some tools provide automation to support your needs. The right tool will provide you with a plethora of financial reporting options, compliance integrations, and will connect your data from multiple sources to make your risk-based decisions more accurate.
These days, manual data management is nearly impossible. When it comes to key risk indicators (KRIs), you can’t afford to make mistakes. By using an operational risk management tool, you’ll reduce preventable oversights and mistakes, which will help you better manage risk.
- Accept risk only when the benefits outweigh the potential cost
Unnecessary risks don’t provide significant value to a goal. It’s never a good idea to take on unnecessary risk because the cost can be devastating. Unfortunately, many people, especially entrepreneurs, have a personal bias that distorts judgment and limits critical analysis.
What makes a risk unnecessary? It’s not the level of the risk that determines whether it’s worth taking, but rather, the potential benefits. Your organization might be fine taking on high risk if the benefits will outweigh the cost, both financially and otherwise.
Regardless, all major risks should be cleared by senior management and stakeholders first.
- Address risk at the appropriate level
Decisions will be made at every level across your organization, so make sure risk decisions are made by the right people. For instance, employees shouldn’t be making decisions that have the potential to seriously impact the company, and managers need to ensure their employees have a strong understanding regarding how much risk they can bear and when to escalate a situation to a higher-up.
- Plan ahead for remediation
Part of operational risk management involves planning. The decision makers in your organization should be incorporating ORM into business processes, which requires time and resources. However, this should be part of every planning and execution phase.
- Categorize and prioritize your risks
You’ll need to categorize and prioritize your risks to get a good idea of what actions you should take and decisions you should make. This is done with a control matrix in five basic steps:
- Identify your risks before conducting your assessments
- Measure risk probability
- Assess the potential impact
- Calculate total risk
- Update your control matrix accordingly
Within your risk control matrix, you’ll be prioritizing risks from the following categories:
- People risk. These are risks caused by people and human resources management. For example, hiring the wrong people, improper training, unmotivated team members, and high turnover rates often result in errors, fraud, and other ethical actions that can harm your organization.
- Systems risk. When internal systems fail, losses can be devastating. This can include the loss of backups, downtime for networks, and other technical errors.
- Process risk. When internal business processes are inadequate, your business can suffer. This includes things like product design flaws and failure to meet project deadlines or deliver projects to a client’s specifications.
- External events risk. These risks are out of your control, like storms, floods, hurricanes, fires, and even manmade problems like robberies, terrorist attacks, and wars.
- Legal compliance risk. When your business fails to comply with internal and external compliance regulations, the risks are great. These issues often involve tax and financial accounting regulations, internal ethical codes of conduct, and any other regulations imposed by a regulatory body governing your industry.
Operational risk management is critical for success
There are many ways to make a business successful, but if you don’t manage risk, one error or incident can tear down all your hard work. The best way to manage risk is to avoid it whenever possible. However, you can’t avoid all risk, and that’s where strategic risk management comes into play. Choose the risk you’re willing to accept, mitigate the potential consequences, and continue fine-tuning your decision-making process to respond better to similar risks in the future.
Business
Hustle Division Evolves into HD AI Lab Group: A New Powerhouse in AI-Driven Marketing

Los Angeles, CA — May 8th — Hustle Division, the award-winning agency behind Gold and Platinum campaigns for brands like PrettyLittleThing and Zootiez by Future — and legendary artists like 50 Cent, Snoop Dogg, Warren G, Normani, Saweetie, Tyga, YG, and will.i.am — is officially rebranding into HD AI Lab Group.
This major evolution is led by E.G., a proud Latino entrepreneur, who also owns Zooly.ai, a fast-growing AI company backed by major investors and already trusted by top brands across the NBA, NHL, and entertainment.
HD AI Lab Group brings together creative energy and real AI innovation to help brands, artists, and businesses grow in today’s world.
“This isn’t just a rebrand — it’s the evolution of everything I’ve built, now powered by real AI to shape the future of marketing,” said E.G., Founder & CEO of HD AI Lab Group.
Stay tuned and follow the journey on the newly revamped Instagram: @hustledivision
Media Contact:
[email protected]
-
Tech4 years ago
Effuel Reviews (2021) – Effuel ECO OBD2 Saves Fuel, and Reduce Gas Cost? Effuel Customer Reviews
-
Tech6 years ago
Bosch Power Tools India Launches ‘Cordless Matlab Bosch’ Campaign to Demonstrate the Power of Cordless
-
Lifestyle6 years ago
Catholic Cases App brings Church’s Moral Teachings to Androids and iPhones
-
Lifestyle4 years ago
East Side Hype x Billionaire Boys Club. Hottest New Streetwear Releases in Utah.
-
Tech6 years ago
Cloud Buyers & Investors to Profit in the Future
-
Lifestyle5 years ago
The Midas of Cosmetic Dermatology: Dr. Simon Ourian
-
Health6 years ago
CBDistillery Review: Is it a scam?
-
Entertainment6 years ago
Avengers Endgame now Available on 123Movies for Download & Streaming for Free