What methods can be used to assess operational risk?

Assessing operational risk is crucial for organizations to identify, measure, and manage the various factors that could disrupt their operations. The use of key risk indicators (KRIs) is particularly effective because these quantitative metrics provide actionable insights into potential risks that could affect business operations. By monitoring these indicators, organizations can anticipate potential problems and implement strategies to mitigate them before they escalate.

Additionally, loss event data analysis plays a vital role in operational risk assessment. This involves reviewing historical incidents where operational failures occurred, helping organizations understand the nature and frequency of risks they might face. Analyzing this data allows businesses to learn from past mistakes, improve their risk management strategies, and prioritize resources effectively to enhance operational resilience.

While the other options include valuable tools for various assessments (such as financial audits or customer feedback), they do not specifically target the nuances of operational risk in the same direct manner as KRIs and loss event data analysis.