Risk Mitigation

Risk mitigation is as simple as having a stepony in the car so if one of the tyres were to go flat, you have another wheel, stepony, to fix your problem. You don’t get stuck with your problem. You continue to carry on and it gives your enough time to fix the flat tyre later. To give one more example, when you want to invest, you don’t put all your money in one particular investment mode, be it shares / mutual funds / precious metals etc., Again, you look at multiple options depending upon your age and risk appetite. 

As the saying goes, don’t lay all your eggs in one basket.  

Primary Objective - Risk mitigation.

In this posting, I want to talk to about how Risk mitigation is used in manufacturing industries/ Business with a few scenarios. Hope you would find it interesting.

Scenario- 1: Risk mitigation in manufacturing industry:

In one the manufacturing industries that I worked for, we used to engage around 250 contract workmen in a packing job which involved packing the finishing goods as per the SOP and ensuring that there is no damage.  It’s the last process after which the goods get delivered to the end customer or the Dealers.

Can you guess the risk involved in engaging contract workmen in this process?

# Any labor unrest can adversely stall the packing operations and it can affect the product delivery.   Labour unrest can happen due to any reasons but we need to anticipate labour unrest. 

Mitigation plan that we did: Instead of having a vendor (contractor) to supply all the 250 workmen, we ensured that we had multiple vendors supplying the required no. of workmen.  It really helped when some of the contract workmen stopped the operations at some point of time, we could still manage with the rest of the workmen and continued our packing operation without any issues.  The Business continuity was ensured.

In manufacturing industries, contract workmen are engaged in various operations. This is one of the good practices that is followed there for risk mitigation.

Scenario- 2 -Travelling: 

When group of top executives or sr. scientists with any path-breaking research results have to fly together, can you guess the risk involved? 

Yes.  Anything can go wrong and it can be due to human sabotage or an accident and it can cost the life of all the people flying together.

Risk mitigation: I’ve heard this scenario from one of the ISO auditors and he was sharing this interesting experience. I understand that the travel plans will not be planned for all scientist flying together so the research results are not lost even if something were to go wrong. 

Scenario 3 – Hiring practices in manufacturing industries.

One of the common problems that you need to anticipate in hiring candidates with a wrong background, let us say, a political affiliation. The risk involved is obvious and it’s really huge. Such candidates may come with their own hidden agenda, form trade unions and spoil the work environment. While a matured recognized trade union is accepted in many places, no one would want to have too many unions and too many affiliations at Workplace.

Risk Mitigation: As a rule of thumb, the Background verification done includes the candidates’ affiliations. 

The golden Rules of Risk Mitigation: 

1) Anticipate Riks:

2) Don't lay all your eggs in one basket. 

Hope you found this interesting.  Have you come across any interesting risk mitigations? Do share your experience.

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