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From Fragile to Robust: How to build operational resilience in your business

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From Fragile to Robust: How to build operational resilience in your business

Operational resilience is an organisation’s ability to continue to deliver critical business services after facing one or more disruptive events. It also covers the ability to predict and prevent disruptive events and better control and recover from them, should they occur.

The pandemic, for example, became a real-world test for many organisations globally. With lockdowns, border closures, and working from home, businesses had to rapidly adapt to new working methods, which normally would have taken a couple of years to implement.

The newly drafted Australian Prudential Regulatory Authority (APRA) Standard CPS 230 on Operational Risk has stated that regulated organisations will need to tighten up several areas of their risk management to meet the new requirements. The focus includes preventing disruption to critical operations, adapting processes and systems to continue operations in the event of a disruption, and returning to normal operations promptly after a disruption is over. APRA does not see operational resilience as something new or separate from operational risk management. It is the outcome and an extension of business continuity management. 

Protecht recently surveyed risk professionals to determine their organisations’ operational resilience understanding and requirements, and it was clear from the results that most respondents value the idea but implementation remains limited. Nearly all surveyed (96 per cent) believe operational resilience should be an important priority for their organisation, but only under half (46 per cent) currently rates their organisation’s operational resilience capacity as “high/very high”.

So, with a high probability of major disruptive events expected in the future, operational resilience is the key to an organisation’s ability to survive and even thrive during such incidents. If there was ever a time to focus on building operational resilience within an organisation, it is now, and here is how to get started.

Identify the core components of operational resilience

An operational resilience framework will require an understanding of:

  • Your important or critical business services.
  • The sub-processes that deliver those services.
  • The resources (hardware, software, teams, infrastructure) connected to the service.

Once identified, it becomes easier to model the risk scenarios that would disrupt that service and think about any preventative controls that will mitigate the likelihood of those scenarios occurring.   Should the scenario occur, we also are in a better position by having planned, documented and tested the recovery strategy. 

Integrate it into your overall Enterprise Risk Management (ERM) systems and framework of your organisation 

Integrating operational resilience as part of your ERM systems ensures that the maximum leverage is obtained from your existing risk and control libraries and processes are not reinvented. This reduces overall costs and the effort it would take to implement the strategy. Instead of starting from scratch, the efforts can be focused on extending current capabilities.

Ensure that the key elements are in place

It is important to have a robust framework to build a sustainable and effective operational resilience Capability. Some key focus areas in this regard are:

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  • Who will govern the implementation and management of the project?
  •  Is the project adequately budgeted for both in terms of people and dollars?
  • A clear plan that doesn’t just rebrand current systems but improves and evolves them to create true enterprise-wide resilience. 
  • Provide adequate training and upskilling to the staff in operational resilience principles that align with the project plan.

Get the leadership buy-in

Since cost and effort are minimised in building operational resilience into the current systems and overall ERM framework, board, and management buy-in is easier as it is not delivered as some new major project but as an additional part of what already exists. The survey found that in over 34 per cent of organisations, operational resilience is a concept that uses much of their existing risk management capability, consolidating existing practices. With the leadership team invested, implementation of the resilience framework would be smoother thereby further reducing effort and time.

Monitor results and use them to your advantage

An important step in any new systems implementation is to analyse its performance, learn from it, modify plans, and communicate the results to all key stakeholders. Resilience can assure critical processes continue under a range of potentially disruptive events.  but must be continually monitored to help identify areas of improvement, single points of failure and redundancy. Resilience considerations can also be used in decision making, whether regarding the location of office premises or a decision to take on a new supplier.

Ultimately, operational resilience is important for any organisation – not just regulated financial institutions.

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At collapsed Baltimore bridge, focus shifts to the weighty job of removing the massive structure

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At collapsed Baltimore bridge, focus shifts to the weighty job of removing the massive structure

BALTIMORE (AP) — Teams of engineers worked Saturday on the intricate process of cutting and lifting the first section of twisted steel from the collapsed Francis Scott Key Bridge, which crumpled into the Patapsco River this week after a massive cargo ship crashed into one of its supports.

Sparks could be seen flying from a section of bent and crumpled steel in the afternoon, and video released by officials in the evening showed demolition crews using a cutting torch to slice through the thick beams. The joint incident command said in a statement that the work was being done on the top of the north side of the collapsed structure.

Crews were carefully measuring and cutting the steel from the broken bridge before attaching straps so it can be lifted onto a barge and floated away, Coast Guard Rear Adm. Shannon Gilreath said.

Seven floating cranes — including a massive one capable of lifting 1,000 tons — 10 tugboats, nine barges, eight salvage vessels and five Coast Guard boats were on site in the water southeast of Baltimore.

Each movement affects what happens next and ultimately how long it will take to remove all the debris and reopen the ship channel and the blocked Port of Baltimore, Maryland Gov. Wes Moore said.

“I cannot stress enough how important today and the first movement of this bridge and of the wreckage is. This is going to be a remarkably complicated process,” Moore said.

Undeterred by the chilly morning weather, longtime Baltimore resident Randy Lichtenberg and others took cellphone photos or just quietly looked at the broken pieces of the bridge, which including its steel trusses weigh as much as 4,000 tons.

“I wouldn’t want to be in that water. It’s got to be cold. It’s a tough job,” Lichtenberg said from a spot on the river called Sparrows Point.

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The shock of waking up Tuesday morning to video of what he called an iconic part of the Baltimore skyline falling into the water has given way to sadness.

“It never hits you that quickly. It’s just unbelievable,” Lichtenberg said.

WHAT HAPPENS NEXT

One of the first goals for crews on the water is to get a smaller auxiliary ship channel open so tugboats and other small barges can move freely. Crews also want to stabilize the site so divers can resume searching for four missing workers who are presumed dead.

Two other workers were rescued from the water in the hours following the bridge collapse, and the bodies of two more were recovered from a pickup truck that fell and was submerged in the river. They had been filling potholes on the bridge and while police were able to stop vehicle traffic after the ship called in a mayday, they could not get to the construction workers, who were from Mexico, Guatemala, Honduras and El Salvador.

The crew of the cargo ship Dali, which is managed by Synergy Marine Group, remained on board with the debris from the bridge around it, and were safe and were being interviewed. They are keeping the ship running as they will be needed to get it out of the channel once more debris has been removed.

The vessel is owned by Grace Ocean Private Ltd. and was chartered by Danish shipping giant Maersk.

The collision and collapse appeared to be an accident that came after the ship lost power. Federal and state investigators are still trying to determine why.

Assuaging concern about possible pollution from the crash, Adam Ortiz, the Environmental Protection Agency’s mid-Atlantic Regional Administrator, said there was no indication in the water of active releases from the ship or materials hazardous to human health.

REBUILDING

Officials are also trying to figure out how to handle the economic impact of a closed port and the severing of a major highway link. The bridge was completed in 1977 and carried Interstate 695 around southeast Baltimore.

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Maryland transportation officials are planning to rebuild the bridge, promising to consider innovative designs or building materials to hopefully shorten a project that could take years.

President Joe Biden’s administration has approved $60 million in immediate aid and promised the federal government will pay the full cost to rebuild.

Ship traffic at the Port of Baltimore remains suspended, but the Maryland Port Administration said trucks were still being processed at marine terminals.

The loss of a road that carried 30,000 vehicles a day and the port disruption will affect not only thousands of dockworkers and commuters, but also U.S. consumers, who are likely to feel the impact of shipping delays. The port handles more cars and more farm equipment than any other U.S. facility.

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Collins reported from Columbia, South Carolina. Associated Press writers Sarah Brumfield in Washington, D.C.; Kristin M. Hall in Nashville, Tennessee; Adrian Sainz in Memphis, Tennessee; and Lisa Baumann in Bellingham, Washington, contributed.

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The Texas attorney general is investigating a key Boeing supplier and asking about diversity

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The Texas attorney general is investigating a key Boeing supplier and asking about diversity

DALLAS (AP) — The Texas attorney general has opened an investigation into a key Boeing supplier that is already facing scrutiny from federal regulators over quality of parts that it provides to the aircraft maker.

The office of Texas Attorney General Ken Paxton said it began looking into Spirit AeroSystems because of “apparent manufacturing defects” in parts that “have led to numerous concerning or dangerous incidents.”

In a statement Friday, a Spirit spokesman said, “While we do not comment on investigations, Spirit is wholly focused on providing the highest quality products to all our customers, to include the Boeing Company.”

Paxton asked the Wichita, Kansas-based supplier to turn over documents produced since the start of 2022 about communication with investors and Boeing about flaws in parts and corrective steps the company took.

The request goes into detail in seeking internal discussions around Spirit’s efforts to create a diverse workforce “and whether those commitments are unlawful or are compromising the company’s manufacturing processes.” Paxton asked for a breakdown of Spirit’s workforce by race, sexual orientation and other factors, and whether the makeup has changed over time.

Since a Spirit-made door-plug panel blew off an Alaska Airlines Boeing 737 Max in January, some conservatives have tried to link aviation safety to diversity at manufacturers.

Paxton is a conservative Republican who this week agreed to pay $271,000 in restitution to victims and take 15 hours of training in legal ethics to settle felony charges of securities fraud. Paxton did not admit wrongdoing in the 9-year-old case.

The Federal Aviation Administration launched an investigation into Boeing Spirit after the Alaska Airlines incident. An FAA audit of manufacturing procedures in Spirit’s factory gave the company failing grades in seven of 13 areas.

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Boeing is in talks to buy back Spirit, which it spun off nearly 20 years ago, as part of a plan to tighten oversight of manufacturing in its supply chain.

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Boeing plane found to have missing panel after flight from California to southern Oregon

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Boeing plane found to have missing panel after flight from California to southern Oregon

By CLAIRE RUSH and LISA BAUMANN

 

PORTLAND, Ore. (AP) — A post-flight inspection revealed a missing panel on an older Boeing 737-800 that had just arrived at its destination in southern Oregon on Friday after flying from San Francisco, officials said, the latest in a series of recent incidents involving aircraft manufactured by the company.

United Flight 433 left San Francisco at 10:20 a.m. and landed at Rogue Valley International-Medford Airport in Medford shortly before noon, according to FlightAware. The airport’s director, Amber Judd, said the plane landed safely without incident and the external panel was discovered missing during a post-flight inspection. No injuries were reported.

The airport paused operations to check the runway and airfield for debris, Judd said, and none was found.

Judd said she believed the United ground crew or pilots doing a routine inspection before the next flight were the ones who noticed the missing panel.

A United Airlines spokesperson said via email that the flight was carrying 139 passengers and six crew members, and no emergency was declared because there was no indication of the damage during the flight.

 

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The Asante Rogue Regional Medical Center is pictured in Medford, Ore., on Jan. 4, 2024. The first lawsuit filed Monday, Feb. 26, 2024, brought amid reports that a nurse at the southern Oregon hospital replaced intravenous fentanyl drips with tap water seeks up to $11.5 million on behalf of the estate of a 65-year-old man who died. (Janet Eastman/The Oregonian/The Oregonian via AP)

 

“After the aircraft was parked at the gate, it was discovered to be missing an external panel,” the United spokesperson said. “We’ll conduct a thorough examination of the plane and perform all the needed repairs before it returns to service. We’ll also conduct an investigation to better understand how this damage occurred.”

The Federal Aviation Administration also said it would investigate.

The missing panel was on the underside of the aircraft where the wing meets the body and just next to the landing gear, United said.

The plane made its first flight in April 1998 and was delivered to Continental Airlines in December of that year, according to the FAA. United Airlines has operated it since Nov. 30, 2011. It is a 737-824, part of the 737-800 series that was a precursor to the Max.

Boeing said, also via email, that it would defer comment to United about the carrier’s fleet and operations.

In January a panel that plugged a space left for an extra emergency door blew off a Boeing Max 9 jet in midair just minutes after an Alaska Airlines flight took off from Portland, leaving a gaping hole and forcing pilots to make an emergency landing. There were no serious injuries.

The door plug was eventually found in the backyard of a high school physics teacher in southwest Portland, along with other debris from the flight scattered nearby. The Department of Justice has launched a criminal investigation.

On March 6, fumes detected in the cabin of a Boeing 737-800 Alaska Airlines flight destined for Phoenix caused pilots to head back to the Portland airport.

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The Port of Portland said passengers and crew noticed the fumes and the flight landed safely. Seven people including passengers and crew requested medical evaluations, but no one was hospitalized, officials said.

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Baumann reported from Bellingham, Washington.

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