To help companies maximize their physical assets and help them yield the highest ROI, they need to have an in-depth understanding of their assets and the risks involved. Without a strong understanding of the risk environment, businesses may make unfounded decisions that end up harming their bottom line. Insufficiently developed process for managing risk and assets could expose companies to costly regulatory fines or losses because of insufficient planning for the unexpected.

The management of risk and assets is confronted by a range of issues.

Inadequate awareness of what an organization’s assets are capable of – For example, employees might be unaware that a certain piece of equipment has the capability to perform a function that is beyond its designed range or how to use it at maximum efficiency. This can lead the asset to be underutilized and have a reduced ROI over its lifespan. This can be prevented by ensuring that employees are trained to be aware of the capabilities of an asset and how to use them appropriately.

A lack of a robust risk management procedures – Ever since the financial crisis, a lot of companies have not had the time to think about strategic risk. This has led to inadequate risk management strategies, incorrect risk assessment methodologies and missed opportunities to improve the performance of an organization’s assets.

Third-party risk – From cyber security to reputational damage and integrity of data Third-party risks can result in significant consequences for an organization. To mitigate this type threat, a thorough vetting process with failsafe procedures must be implemented to ensure that every vendor has been accepted.

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