An evaluation of operational risk management practices within the clay brick manufacturing companies in Zimbabwe: A case of BETA Bricks (January 2011 - December 2012)
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ABSTRACT The research study was an evaluation of operational risk management practices in Beta Bricks Private Limited considering the problems in the company.The research was motivated by the fact that the company has been experiencing reduced market share, high labour turnover particularly on low level employees, increased down time, high loss incidents, increased cost of production and high waste across its operations. The researcher noted that the problems the company was facing were in relation to the management of people, systems and processes which are key variables of operational risk management. Literature on the subject was reviewed which pointed out that the subject was well developed in the banking industry although it was applicable in the manufacturing sector. The research focused on how operational risk was managed in the company against best practices from establishment of context to monitoring and review of operational risks. Questionnaires were used to gather information from the company and the results were analysed. The major findings were that there were gaps in operational risk management in the company. These gaps included lack of policies and procedures, non-involvement of lower level employees in the activity, the failure for board to provide oversight on operational risk management and lack of integration of operational risk in the company’s performance. The researcher recommended the need for the company to lay a solid foundation which support operational risk management in order to enhance performance. The foundation included the support from the board in creating a framework for operational risk management, policies and procedures, and risk awareness across the organisation.