OPERATIONAL RISK ANALYSIS

An operational risk analysis is a systematic process for identifying, assessing, and managing events that could cause financial losses or damage to a company due to failures in internal processes and procedures, human resources, systems, or external events.

Unlike market or credit risks, operational risk focuses on *how* an organization's day-to-day operations function—or fail.

Key factors analyzed:

To conduct this analysis, potential failures are typically classified into four main categories:

Internal Processes: Errors in task execution, poor procedure design, or a lack of controls.

Human Resources: Human error, internal fraud, lack of training, or excessive reliance on key personnel.

Systems and Technology: Software or hardware failures, cybersecurity breaches, or a lack of technological updates.

External Events: Natural disasters, regulatory changes, supplier failures, or external attacks (theft/fraud).

Recommendations for avoiding these negative situations include: monitoring operational activities, and developing manuals for standards and procedures, job roles, operational quality, etc.

ASOVICTRA can assist you with this task; please write to us, and we will provide guidance.