What is Risk Management in Manufacturing?Published December 13, 2019 • 2 min read
Risk management in manufacturing refers to the unique challenges that the manufacturing industry faces in managing risks. Cybersecurity risks can be especially challenging to manage.
Increased digital connectivity via artificial intelligence such as robots, the internet of things (IoT), augmented reality, and other forms of new technology can make factories more efficient. But every connection serves as a possible portal for cybercrime.
And the stakes for manufacturing organizations can be especially high. A breach of one factory or facility could cause shutdowns or damage to its sister factories, resulting not only in lost productivity and revenue, but also, possibly, worker injury and even death.
Special risk management considerations for manufacturing companies include:
Enhanced risk assessment
Assessing a manufacturing company’s potential risks doesn’t just entail examining its own IT systems and cybersecurity. Risk identification should extend throughout the supply chain, starting with providers of the raw materials its factories use, and include third-party vendors.
Strategic risk identification
What risks are likely to be your greatest concern years into the future? In a Deloitte survey of manufacturing companies, executives said cybersecurity would be their number-one risk management priority. Compliance with critical infrastructure risk management frameworks such as National Institute of Standards and Technology Special Publication 800-53, Security and Privacy Controls for Information Systems and Organizations, is key, especially for companies affected by federal security regulations regarding critical infrastructure.
SCADA quality assurance
Keeping Supervisory Control and Data Acquisition (SCADA) systems and Industrial Control Systems (ICS) always on is crucial, so quality assurance testing is imperative. SCADA systems monitor and control a plant or equipment in industries such as manufacturing, telecommunications, water and waste control, energy, oil and gas refining, and transportation. Upgrading and updating systems and software, and monitoring them continuously, are also key. Our 11-step guide to managing manufacturing risk can help.
Numerous case studies show that software such as ZenGRC can greatly simplify the task of risk management for manufacturing organizations, and ensure compliance with regulations and standards come audit time.