Supply Chain Management
Handbook
Risk Management
Awareness Presentation
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Contents
Risk Management Concepts & Philosophies
• What is risk? (ISO 31000)
• Where do risks appear in the business phases?
• What is risk management?
• Why do you want risk management?
• What does a risk management program do?
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Contents
Processes
• What are the Elements of a risk management
program?
• How do the elements relate to a Management
System Risk Management Tools (9134)?
Examples
• Examples of types of risks
• Example of specific risks in that risk type
Organizational Risk Maturity Model
Risk managemnt and the 9100 Quality standard
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Risk Management Concepts &
Philosophies
What is Risk?
ISO 31000:
An undesirable situation or
circumstance that has both a likelihood
of occurring and a potentially negative
consequence
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Risk Management Concepts &
Philosophies
Where are we confronted with risks during the
business phases?
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Risk Management Concepts &
Philosophies
What is risk management?
An iterative process to identify, assess,
reduce, accept, and control risks in a
systematic, proactive, comprehensive
and cost effective manner, taking into
account the business, costs, technical,
quality and schedule programmatic
constraints.
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Risk Management Concepts &
Philosophies
Why do you want risk management?
To reduce the chances of something harmful
happening to the business. This involves a focus on
the risks to meeting customer requirements, and
preventing product non conformance escapes. The
absence of a Risk Management program can result in
known, unknown, and unknowable /unforeseen
problems for the Customer and Stakeholders
concerning the cost, schedule, and technical
performance of programs and concerning the quality
and on-delivery performance of products and
services.
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Risk Management Concepts &
Philosophies
What does a “Risk Management Program”
do?
Describes the organization's attitude and
approach towards risks, how it conducts risk
management, the risks it is prepared to accept
and how it plans on dealing with those it
chooses not to accept and defines the main
requirements for a risk management plan.
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Risk Management Concepts &
Philosophies
What does a “Risk Management Program”
do?
A Risk Management Program:
Helps Organization (company structure):
 to identify risks
 to reduce occurances and impacts of risks
 to understand significance/severity of risks
to promote organizational behaviors forcused on risk
management
 to increase effectiveness of product and service delivery to
customer
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Risk Management Concepts &
Philosophies
What does a “Risk Management Program”
do?
A Risk Management Program:
Creates a process for who, what, when,
where, how and how much.
 Helps us to maintain information on
historic issues.
 Helps capitalize on historic issues to
prevent future issues.
Helps organization bring out hidden risk
knowledge, so it can be managed.
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Processes
What are the elements of a “Risk
Management Program”?
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Processes
Risk Management Tools (examples 9134)
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Processes
Risk Management Tools (examples 9134)
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Processes
Risk Management Tools (examples 9134)
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Risk Management Concepts &
Philosophies
Examples of types of risks;
Financial
Strategic
 Compliance / Effectiveness
 Operational / Planning including physical &
environmental
 Human Factors
 Political (import export controls)
 Environment Health & Safety
 Ethical, legal, image
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Processes
Example of specific risks in that risk type
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Adapted from : James Reason, Managing the Risks of Organizational Accidents, 1997, p. 12
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Organizational Risk Maturity Model
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Organizational Risk Maturity Model
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Organizational Risk Maturity Model
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Risk Management and the 9100
Quality Standard
0.1 General
3.1 Definition of Risk
3.2 Special Requirements
3.3 Critical Items
3.4 & (7.2.1, 7.2.2, 7.3.3) Key characteristics
7.1.1 Risk Management while doing Project Management
7.1.2 Risk Management
7.2.2 Product Risks
7.4.1 Supply Chain Risk
8.5.3 Preventive actions
Note: When viewing the wording of the 9100: 2009 standard, be aware of wording
such as 'as appropriate', 'complexity' and other wording that provides the organization
for options. Applying the concepts of Risk may have an influence as to the options that
an organization implements.
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