Operational Risk Management – a new category of enterprise software?

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A new category of software is finally emerging in the market. A few “Smart Innovators” have designed a new way to manage operational risk in the hazardous industries. The name for this new category is yet to be defined. In their latest report, independent research analyst, Verdandix, named it “Operational Risk Management”. Gartner has not decided yet. And at Petrotechnics, we call it an “Operational Excellence Platform”.

What is it?

The new category of software is an integrated toolkit used to decrease operational risk and increase efficiency. By bringing together sensor and human input, the software provides a clear picture of operational risk to help teams better plan and execute maintenance work. Bits and pieces of it have existed in organisations for over 20 years – whether in paper-processes or electronic registers. But the uniqueness of these innovative solutions brings together data traditionally managed in silos and displays them in a meaningful way.

To understand its potential, try to answer this question: what is the level of cumulative operational risk on your plant and the trend for the next few shifts?

It is a hard one.

Maybe you are trying to form an answer by mentally juggling data from your your safety case, a deviation register, some ancient bow ties, your historian systems and quite a lot of sophisticated dashboards.

This is a good start, but these elements do not answer the question your operational teams need now: what is the live cumulative risk of your asset for today’s shift and for the next 14 days?

Now, let’s imagine you have implemented an Operational Risk Management platform. Whether data comes from your historian, management of change or activity management systems, you have a way to put them together in a meaningful way, so that at any-point-in-time you know the risk level leading to a possible major hazard event on your plant. Understand what drives risk, which process safety barriers are impaired and make the right decisions in terms of planning and executing work.

operational risk management softwareWhere does it come from?

Enterprise Operational Risk Management software comes from industry transformation. Vendors are transforming their legacy point solutions into integrated tool kits. Traditional ERP vendors (SAP, IBM) have naturally expanded their product capabilities to cover EHS functionalities, while EHS software vendors have concentrated their efforts on operational risk specifically – including incident management, operational risk assessment, etc. Also, specialist industry software vendors have re-positioned their offering(s) to reach other verticals looking for the best practices in health and safety that have been standard – particularly within the oil and gas – for some time.

With different strengths areas and focus, providers are working to deliver standardised functionality on desktop and on mobile devices:

  • ePermit to Work (ePTW) and isolation management
  • Operational log/ Shift handover
  • Deviation management
  • Management of Change (MoC)
  • Emergency management
  • Incident management

To be efficient, these solutions more and more integrate with data historians, planning, GIS, 3D, engineering, and EHS systems, benefiting from the web services technology which has made the interoperability of systems much easier.

The ROI

Digital solutions addressing safety and efficiency challenges offers extreme potential for healthy ROI. If fact one of Petrotechnics’ Proscient clients reported an annual savings of $6.5M (USD), and a 47% reduction in downtime. (Download the infographic)

operational risk management software

And this is just the beginning. E&Y indicated that Operational Excellence could save the Oil and Gas industry alone over $30 billions over the next five years.

At Petrotechnics, we believe that this new category of enterprise technology will be a key enabler.

What do you think? Is Operational Risk Management a new category of enterprise technology? It is a game-changer for hazardous industries?

operational risk management softwareSOPHIE MENARD is Petrotechnics’ Partner Solution Manager. She is in charge of identifying synergies with technology partners and system integrators to deliver high-value solutions for Petrotechnics’ Proscient customers. Sophie is deeply involved in transforming the Proscient platform to address the current and future needs of the hazardous industries.

Sophie joined Petrotechnics in 2013, and has spent the last 12 years in the software industry, implementing and designing solutions in various verticals, including oil and gas, automotive and retail. Sophie’s earlier experience included being SAP consultant at Accenture and as a project manager, deploying Oracle retail solution.

Sophie is a graduate of ESCP Europe.

Read more Reality of Risk insights.

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