What is the main purpose of Operational Risk Management (ORM)?

The main purpose of Operational Risk Management (ORM) is to serve as a decision-making tool used by individuals at all levels within an organization. ORM provides a structured approach for identifying, assessing, and mitigating risks that could impact operations and objectives. It encourages proactive management of potential risks and facilitates informed decision-making by providing insights into possible consequences and how best to navigate challenges.

ORM is not designed to eliminate all risks entirely, as this is impractical in any operational context. Instead, it aims to understand and manage risks efficiently, thus allowing organizations to take calculated risks that are necessary for growth and innovation while ensuring safety and compliance. This approach supports the overall mission and objectives of the organization, helping teams make sound decisions by weighing the benefits and risks associated with their actions.