How might ORM improve an organization's resilience?

Operational Risk Management (ORM) enhances an organization's resilience primarily by enabling better preparation and response to risks. It provides a structured approach to identifying, assessing, and mitigating potential risks that could disrupt operations. By systematically analyzing operational risks, organizations can develop strategies and contingency plans that not only prepare them for potential adverse events but also enhance their agility in responding effectively when issues arise.

This proactive stance fosters a culture of risk awareness and encourages the adoption of preventive measures, thereby reducing the impact of risks on the organization. Furthermore, by ensuring that employees understand processes and procedures for managing risks, ORM can empower staff to act decisively in crisis situations, which is essential for maintaining business continuity and minimizing losses.

In contrast to increasing bureaucratic processes or limiting employee engagement, effective ORM seeks to streamline decision-making and promote a collaborative environment where employees feel engaged and prepared. Focusing solely on financial growth neglects the comprehensive nature of operational resilience, which encompasses not only financial stability but also the ability to maintain service delivery and protect the organization’s reputation during adverse conditions. Thus, the integration of ORM into organizational practices contributes significantly to building and sustaining resilience in the face of operational challenges.