What is Risk Based Thinking? | ISO 9001 Risk Based Thinking

What is Risk-Based Thinking? | ISO 9001:2015 Risk-Based Thinking

Risk-based thinking ensures these risks are identified, considered and controlled throughout the design and use of the Quality Management System.

What are Risk and Risk-Based Thinking?

➤ What is Risk?

→ An ISO 9001:2015 defines Risk as “The Effect Of Uncertainty On an Expected Result."
→ There are two types of risk available with the system,
  1. Positive Risk - It is an opportunity
  2. Negative Risk - It is an issue.
What is Risk?

➤ What is Risk-Based Thinking?

 It is something we all do automatically and often sub-consciously.
→ Risk-based thinking makes preventive action part of the routine.

Risks Associated In a System:

➥ The Risk associated with a system is affected by the below criteria:

  1. External Provider
  2. Input
  3. Process
  4. Output
  5. Customer

➥ Also, the Risk associated with a system is affected to 6M like:

  1. Man
  2. Machine
  3. Material
  4. Method
  5. Mother Nature (Environment)
  6. Measurement (Measures)

Risks Associated In a System

Strengths and Weakness – Internal Factor in Risk-Based Thinking in ISO 9001:

➥ According to Risk Based Thinking, The strength associated with a system is like:

  1. Infrastructure
  2. Machines
  3. Resources
  4. Good Will
  5. Fewer Competitors

➥ Similarly, The weakness associated with a system is:

  1. Delay
  2. Defects
  3. Scrap
  4. Complaints
  5. Repetitive Issues

Internal Factor of Risk-Based Thinking

External Factors in Risk-Based Thinking in ISO 9001

➤ External Factors associated with a system:

  1. Political Factor
  2. Economical Factor
  3. Social Factor
  4. Technological Factor
  5. Environmental Factor
  6. Legal Factor
External Factors for Risk-based Thinking

➥ Political factors:

→ Political factors are basically how the government gets involved in the economy like,
→ Tax policy, 
→ Labor law,
→ Environmental law,
→ Tariffs etc....

➥ Economic factors: 

→ Economic factors, those economically affect the organization like:
→ Economic growth, 
→ Interest rates, 
→ Exchange rates and 
→ The inflation rate etc.…

➥ Social factors:

→ Social factors are socially related to the organization like:
→ The cultural aspects,
→ Customs, festivals,
→ Lifestyle and
→ Locality etc.….

Technological factors:

→ Technological factors are technological aspects like …
→ New process adaption,
→ R&D activity, automation,
→ Technology  incentives and
→ The rate of technological change etc.…

➥ Environmental factors:

→ Environmental factors include ecological and environmental aspects such as…
→ Weather,
→ Climate and
→ Climate change
→ Natural Resources etc.…

➥ Legal factors:

→ Legal factors include the statutory and regulatory compliances associated with the system.