Common Challenges to Asset and Risk Management

Posted by Security Vault

To maximize the value of their physical assets and help them return the most, they need to have an accurate understanding of their assets and the risks associated with them. Businesses can make poor choices if they don’t have an accurate understanding of risks. This can ultimately hurt their bottom line. A lack of a robust risk and asset management process can leave organizations vulnerable to regulatory fines and loss of profits due to poor planning.

The most prevalent and significant challenges to managing risk and assets include:

Inadequate awareness of what an organization’s assets can do For instance, employees might be unaware that a piece of equipment is able to perform a job beyond its intended range or to make it operate at its maximum efficiency. This can lead the asset to be inefficient and suffer a reduced ROI over the course of its life. This can be reduced by ensuring that employees receive proper training to understand the capabilities of an asset and how to utilize it appropriately.

Lack of a solid process for managing risk – The continuous stream of compliance demands that have flooded the sector since the financial crisis has caused many companies to have little time to consider strategic risk considerations. This has led to poor risk management strategies, inaccurate risk assessments and missed opportunities to optimize the company’s assets.

Third-party risk – From cybersecurity to data integrity and reputational damage Third-party risks could have significant consequences for an organization. To minimize the risk of this kind an effective vendor vetting procedure should be put in place with failsafe processes in place to ensure that every vendor is properly vetted.