Having difficulty measuring Operational Risk ROI? OK, let us give it a try …
A little background on return on investment first: In his 1936 book titled “The General Theory of Employment, Interest and Money,” famed British economist John Maynard Keynes wrote: “The social object of skilled investment should be to defeat the dark forces of time and ignorance which envelope our future.”
While it might come off as a skosh on the cynical side, it’s true that the key to devoting time and resources toward any strategy is to be well-informed about possible outcomes and generate a plan that will bring a great ROI as well.
In terms of Operational Risk Management, those “dark forces” are, of course, the hazards and dangers that can be lurking within the organization and can negatively affect operations, production and, most importantly, people.