As an IT leader or engineer, you know the score: every day is a delicate balancing act. You’re pushing for innovation while constantly looking over your shoulder at everything that could go wrong—the outage, the breach, or the failed audit. Moving from reactive damage control to proactive stability isn’t a pipe dream; it’s a necessity. A robust risk management program is essential for minimizing disruptions and requires a systematic approach, which we refer to as operational risk management (ORM).
We’re here to help you move past the chaos. It’s time to stop feeling like you’re playing whack-a-mole with system failures and start building a resilient operation. We’ll show you how the best teams are using smart frameworks, automation, and a risk-aware culture to keep their systems humming.
Key takeaways:
- Automation is Your Force Multiplier: Use technology to move from manual, sporadic checks to continuous, real-time risk monitoring
- Structure Beats Chaos: Implement a proven risk management framework (RMF) and clear governance arrangements to define who owns what
- Measure Before You Manage: Define and track key risk indicators (KRIs) to get an early warning about brewing trouble
- Culture is Your Ultimate Control: Continuous training and executive buy-in turn your team into your most effective defense against operational risk
Where Are the Gaps? Identifying and Sizing Up Your Risks
Before you can fix a problem, you must first know it exists. And let’s be honest, in IT, problems are everywhere. Risk identification and assessment is the process of putting a name and a value to those scary possibilities. It’s the detective work that fills up your operational risk profile and risk register—your master list of everything that can go wrong. To do this right, you need a repeatable methodology.
Digging for danger: Modern identification tools
The old-school method of asking people what keeps them up at night isn’t enough anymore. You need tools that dig deep into your infrastructure and code to find potential risks. We deal with many types of risks every day, most of which stem from internal processes, human error, and technology failures.
- Code Scanning: Static application security testing (SAST) and software composition analysis (SCA) are essential for catching issues in third-party components and your own code. Popular industry tools include SonarQube and Semgrep for developer-friendly SAST and Snyk or Mend.io (formerly WhiteSource) for comprehensive SCA that flags known vulnerabilities in open-source dependencies.
- Catching the Slips: Secrets detection tools are essential here, scanning repositories and configurations (config) for accidentally hardcoded credentials (such as API keys or passwords). GitGuardian and TruffleSecurity are well-regarded for this job, offering real-time scanning of code commits and entire Git history.
- The Full-Stack Picture (Visibility): To really nail risk identification, you need comprehensive visibility across your entire environment. This is where SolarWinds® Observability comes in. It helps you correlate metrics, traces, and logs from every layer—app, infrastructure, and database—to spot anomalies that indicate a high-risk state.
- Rapid Response Connection (Detection/Triage): Finding the risk fast is great, but getting the right person on the problem immediately is the ultimate goal. Tools such as SolarWinds Incident Response by Squadcast streamline the critical minutes between detection and resolution, ensuring the right expert is automatically alerted and equipped with the context needed to start the risk mitigation clock immediately.
- The Drift Check (Config Risk): Your system configs are risks in themselves. Config drift happens when a running system slowly deviates from its secure, intended state.
Sizing up the threat: Prioritization is key
You’ll find hundreds of risks, but you can’t fix them all at once. This is why the “assessment” part of this process is so important, as it helps you figure out which risks are truly mission-critical.
- The Classic Matrix: Most teams start with the probability-impact matrix, where you estimate the likelihood and the severity of the potential impact
- Advanced Vulnerability Scoring: Instead of looking at the Common Vulnerability Scoring System severity, smart teams are using tools such as the Exploit Prediction Scoring System (EPSS); EPSS tells you the probability that a vulnerability will be exploited in the wild, helping you prioritize patching efforts based on real, active threats
What-ifs and worst cases: Scenario analysis
You have to think like a bad actor to truly understand your risks. This is where scenario analysis comes in. For example, failure mode and effects analysis helps you trace a failure in one system all the way through to its full operational impact.
The detective work of identifying and assessing risk is only the beginning. You’ve got your list of potential headaches; now you need a way to track their vital signs 24/7. This constant flow of risk data is what turns static analysis into dynamic protection.
KRIs: Your IT Dashboard’s Early Warning System
You can’t manage what you can’t measure, and this measurement is all about defining and tracking KRIs. Think of a KRI as the oil pressure light on your car’s dashboard—it’s the sign of trouble brewing before your engine seizes up. You need to stop guessing and start using data to anticipate risk levels.
KRIs are essentially risk metrics that signal a change in your organization’s risk profile. They should be tied directly back to your established risk appetite.
The power of continuous monitoring systems
Defining KRIs is step one. Step two involves building a system that constantly monitors KRIs through continuous monitoring systems. Your risk management information system becomes mission control, pulling risk data from all your other tools and turning the raw information into meaningful KRIs. We’re talking about real-time anomaly detection and constant pipeline scans to ensure you catch everything early.
Great, you’re tracking the vital signs. But what good is a dashboard if no one sees the flashing light? You need a system that translates those KRIs into action and facilitates better decision-making.
Cutting Through the Noise: Communicating Risk That Matters
Risk reporting and communication isn’t about dumping data on people; it’s about giving the right people the right information at the right time so they can act. Good reporting fuels better initiatives.
Making Data Visual: The Power of Dashboarding
Your biggest stakeholders don’t have time to wade through spreadsheets; they need the big picture instantly. This is where dashboard visualizations and excellent dashboarding play a crucial role. Using reporting tools and dashboards to create custom reports for different stakeholders helps ensure the data is relevant and not overwhelming.
Getting the Message Out: Timeliness Is Everything
When a critical risk event happens, a delay of minutes can cost millions. Your communication system must be fast, clear, and integrated into your daily workflow.
- Automated Notifications: Automated notifications should be triggered directly from your operational risk management software and pushed to the right teams immediately
- Escalation Process: A clear escalation process defines exactly who needs to be notified and how quickly based on the alert’s severity
- Integration with Workflow: Ticketing system integrations automatically create, update, and close tickets based on risk alerts, ensuring every risk has an associated work order
Once you’ve communicated the risk and everyone knows the score, you need a defined plan of attack. How do you achieve effective risk control?
Your Risk Playbook: Controlling and Minimizing the Blast Radius
You’ve identified your risks and got your risk management plan—now it’s time to put on the tactical gear. The real work is in risk reduction and effective risk mitigation.
Building the defenses: The power of controls
The core of risk reduction is the implementation of controls—measures taken to prevent a risk or minimize its potential impact, helping avoid financial losses or reputational damage. You primarily focus on internal and security controls.
To keep this organized, the best teams use a risk and control matrix, which links each identified risk to the specific controls designed to manage it. You can pull these from a central risk and controls library.
The four pillars of risk response
When a risk pops up on your dashboard, you need a quick, defined risk response strategy, often referred to as risk mitigation strategies. The four pillars of risk response include:
- Risk Reduction (Mitigation): Implementing technical and internal controls to lower the risk (this is where most mitigation strategies fall)
- Risk Avoidance: Changing your plan or process to eliminate the risk entirely
- Risk Transfer: Shifting the financial burden to a third party, such as a cyberinsurance company
- Risk Acceptance: Documenting and proceeding with residual risk, which is low-impact and too costly to eliminate
Mitigation requires significant effort, especially in a complex environment. Hence, the best teams don’t rely on manual effort; they streamline their strategy using technology itself.
Automation: Your Secret Weapon Against IT Chaos
As doing all of this manually is impossible, pivoting from spreadsheets to automation and technology is crucial. It’s about giving yourself a brainy, tireless sidekick that handles the tedious, repetitive stuff.
Ditching the manual grind with automated monitoring
Automated monitoring systems and risk analytics are constantly scanning for trouble. We’re using artificial intelligence and machine learning for predictive modeling to guess where your next failure point will be—giving you time to fix it before the outage.
Auto-remediation and reporting: Closing the loop
Robotic process automation and automated remediation activate when a noncompliant configuration is found, executing a pre-approved script to fix it and reducing the mean time to resolution from hours to minutes. For the paperwork, automated reporting tools pull clean, real-time data to automate compliance processes.
Although the tools handle the action, you need a master plan to ensure these processes are coordinated, legally sound, compliant, and properly authorized. This ties your technical efforts to the broader enterprise risk management (ERM) strategy.
Putting a Ring on It: Structuring Your Operational Risk
A framework is the blueprint, and governance is the oversight to ensure accountability.
The foundation: Defining your risk boundaries
You must establish your risk appetite and set risk limits. This structure, formalized in your operational RMF, is especially crucial in heavily regulated sectors such as financial services and for financial institutions.
Governance: Who watches the watchmen?
A framework is a binder of documents without solid governance arrangements. Oversight ensures accountability across the organization and helps you meet all your compliance obligations and regulatory requirements, including managing compliance and financial risk. Your operational RMF is the operating layer that supports the wider ERM system.
The framework provides the structure, but a document doesn’t run itself. You need clear accountability for every single piece of the risk puzzle in your day-to-day operations.
Who Does What? Structuring Your A-Team for Risk
Effective operational risk management requires a clear definition of roles, responsibilities, and team structure. Without this clarity, critical tasks get missed.
Defining ownership: The three lines of defense
The core is clear accountability, often structured by the three lines of defense model:
- First Line (Operations/Engineers): They are the risk owners who implement the controls and manage the risks
- Second Line (Risk/Compliance Teams): They set the framework and monitor the first line’s compliance with risk metrics
- Third Line (Internal Audit): They provide independent assurance to senior managers
Connecting the dots with visibility
The governance structure must provide stakeholders with appropriate visibility by defining who needs to see what and when, thereby empowering them to take action within their defined roles.
You’ve set up the system and assigned the team. Now, how do you ensure the whole machine doesn’t rust and the process improves as your business seeks true operational resilience?
Don’t Set It and Forget It: The Continuous Improvement Loop
If your risk process isn’t constantly evolving, it’s already stale. Continuous improvement and the application of proven operational risk management practices are the operational heartbeat of a resilient IT organization.
The gold standard: Drawing on frameworks
Align your efforts with established frameworks, such as the National Institute of Standards and Technology (NIST) RMF or the NIST Cybersecurity Framework. This gives you a proven blueprint for managing the entire lifecycle, including mitigating risks from external events such as natural disasters or supply chain failures.
The uncomfortable truth: Audits and post-mortems
You need to actively look for what’s broken. Regular audits and reviews check your internal controls and help you find remediation of control gaps. When something goes wrong (e.g., a data breach), a proper post-mortem analysis looks at why the failure happened, helping you update your business continuity plan to limit the risk of loss and address any emerging risks.
The human firewall: Building a risk-aware culture
The best systems won’t protect you if the people using them aren’t on board. A strong risk culture means everyone understands that managing risk is part of their job. Continuous education and training should involve engaging formats such as virtual learning modules and hands-on workshops where teams practice incident response.
Operational risk management isn’t a destination; it’s a constant process. You’re not aiming for a perfect, risk-free environment—that doesn’t exist. You’re aiming for a mature, efficient operational risk management process that identifies, measures, and controls risk with minimal effort, freeing your team to focus on the innovation that moves your business operations forward. By integrating these best practices into a cohesive risk management strategy—from defining your operational RMF to leveraging automation—you stop being the firefighter and become the master architect of a stable, resilient IT operation.