Risk Mitigation
Are Unnecessary Risks Harming your Profitability?
What many business owners and managers don't realize is just how important risk mitigation is to the success, growth and competitive advantage of their business as it applies to assembly and fabrication work.
Meet Bob. Follow his journey through risk assessment and mitigation, and learn how Swagelok can help support you with your toughest business challenges.
A 2015 survey by PricewaterhouseCoopers revealed that focusing on risk management can save time on the front end of a business decision, and on the back end it relieves the cost and time challenges of responding to a previously unseen risk. Risk mitigation done well is a competitive advantage that can increase efficiency and enable growth1.
Engineering a design that merely works isn’t good enough. It should work efficiently, have a minimum number of potential leak points, and take up as little physical space as possible. Choosing a vendor with experience taps into their ability to tune their performance to the demands of different markets and can yield improved results for you.
Maybe your company is an OEM, with all the space and tools that you need. And you have enough work to keep four or five people busy. Then a big order comes in and you suddenly need ten people. If you can’t respond instantly, you stand to lose your customer’s trust, which could mean losing their next order. Even a small disruption can create a big headache for a customer, potentially affecting your reputation with them.
If your primary business doesn’t involve assembly and custom fabrication, you might have to make several major line item investments before you can even begin to do the work for yourself. You’ll have to order parts, likely from multiple vendors. Where will you put all the parts until assembly? Do you have the appropriate tools to do the work? Will you have to take people away from their primary jobs to put everything together?
A comprehensive warranty is a simple way to mitigate your potential risk. However, if a company does all its own fabrication and assembly for in-house use, there’s no warranty at all on that work. Using an outside assembler and fabricator can remove those burdens, provided that the final assemblies are back by a strong warranty.
It is tough getting and maintaining a competitive advantage in today’s volatile business climate – risk mitigation done well is one way to set your company apart. When considering your operational risks, like those related to fabrication and assembly, keep in mind the importance of:
- The quality of your parts
- The system design
- A robust supply chain
- Certified assembly work
- The warranty of the parts and final assembly
- Supplier support
These insights will help make sure you are not taking unnecessary risks in fabrication and assembly work while maintaining your reputation and giving your business a better opportunity at profitability.
Learn how Swagelok can help you mitigate the risk associated with fabrication and assembly.
1PricewaterhouseCoopers, “Risk in review: Decoding uncertainty, delivering value,” http://www.pwc.com/gx/en/audit-services/publications/assets/ pwc-risk-in-review-2015.pdf PricewaterhouseCoopers April 2015.