Asset and risk management is a system of practices that guarantees an organisation has the assets it needs to carry out its business. A framework that is efficient will improve efficiency and reduce risk. It allows a company to deliver its goods or services on time and according to standards.
The initial step of the process is to discover all the assets owned by a company. This could include tangible assets like machinery and inventories and intangible ones such as intellectual property and client lists. The next step is assessing the potential risks associated with these assets. This includes risks to the integrity of the asset, such as damage or theft, as well as the impact these risks may have on the firm’s operations.
The third step is to develop and implement strategies for mitigating those risks. This could include security measures, maintenance programs and insurance policies. Assets are important for every company, but they can also be risky in the absence of proper management. This is why a solid risk management system is so important.
Ultimately, the objective is to balance risk with performance. While it’s impossible to completely avoid risk, most companies will not succeed unless they accept some at a level they are comfortable with. It’s vital that companies have a comprehensive and consistent method of identifying, assessing, and managing risks to assets so that they can maximize the value of their assets while minimizing risk for operations.
