Industrial Risk Management and Prevention

A risk management strategy is important to reduce accidents, injury, or death in industrial facilities. To create a facility safety strategy for your warehouse, manufacturing floor, or other industrial location, consider these five steps to identify and mitigate risks.

What Is Risk Management?

Risk management is an ongoing process that identifies hazards—including physical risks to employees and business-related risks such as supply chain challenges—and takes steps to reduce loss. The cycle of risk management never ends: After risks have been identified and mitigated, the process begins again to evaluate changes made and identify new risks.

Five Steps of Risk Management

For our purposes, we will discuss hazards that may result in accidents or physical harm, and how risk management applies to employee safety. These hazards can also impact production if the facility must close due to an accident. Fine issued in response to an accident or failed inspection may have a financial impact.

1) Identify Risks

The first step of a risk management strategy is to identify the risks within the facility. While these may include financial or competitor risks, physical safety is a top priority in industrial facilities and warehouses. Harness a variety of methods to spot potential problem areas.

Risk identification methods include:

Reviewing audits and inspections for failed items
Hiring a third-party inspection agency to audit risks
Interviewing employees from all levels to determine potential hazards
Consulting accident reports to determine recurring dangers or injuries
Walking the production floor or warehouse to look for hazards
Searching OSHA’s accident statistics to determine common problem areas
Examining existing floor marking tape and sign applications to identify damage

2) Assess Risks

Consider who may be harmed by identified risks. This may include full- or part-time employees, temporary staff, visitors, delivery or shipment personnel, or any others who may have access to the location at any time.

Judge the severity of the risk, as well. Ergonomic risk for employees working in an office may cause discomfort, but are not life-threatening. Blocked emergency exits may put many employees at serious risk—though this issue can be resolved quickly, unobstructed access is required, so fines may be issued for violations. Issues that pose an immediate risk to health and safety are more severe and should be considered high-priority, which brings us to step three.

3) Prioritize Risks

Rank risks to determine which should be given higher priority. Some hazards may pose a minor risk, while others require immediate attention. The priority level may also incorporate the effort required to address the risks. For example, installing floor marking tape to make aisle width clear may take a few minutes, while replacing an entire 5S/Lean workflow will take significantly more time. After the priority level has been determined, consider the tools, skills, and other requirements necessary to make changes and create a plan to address each hazard.

4) Mitigate Risks

After identifying and prioritizing risks, implement the best solutions for minimizing, controlling, or removing the hazard. In an industrial facility where risk may equal injury or death, steps to prevent accidents may be as simple as installing hazard or caution floor tape, providing clear instructions using signage, marking “Keep Clear” in areas where hazardous clutter tends to accumulate, or replacing faulty equipment—but larger fixes may be required. Some examples of industrial and warehouse risks, and potential solutions include:

Slip, Trip, Fall Hazards	Install easy-to-understand signage to communicate danger Add reflective floor marking tape to bring attention to edges and inclines Create physical barriers to prevent accidents Limit access to authorized employees only Install anti-slip tape on stairs, ladder rungs, ramps, or wherever added traction is necessary
Fire Hazards	Clearly label fire safety equipment Maintain a well-marked emergency exit route Reduce fire hazards in areas where combustible items are stored, where hot work is completed, etc. Include annual fire safety training Audit for OSHA compliance monthly
Loading Docks	Install a barrier or safety rail to prevent falls Mark edges and inclines with floor marking tape for better visibility Apply lines to designate forklift turning radius to prevent collision or bodily injury Use reflective tape to make forklifts, trucks, walls, and dock edges more visible
Repetitive Motion Injuries	Post signage to remind employees to stretch Include proper lifting technique in training Provide adequate breaks Supply posture belts, braces, and safety equipment Re-arrange production floor or warehouse to facilitate safe lifting and product transport
Vehicular Hazards	Separate forklift and pedestrian traffic with barriers or separate lanes marked with industrial floor tape Make machinery easier to spot by applying reflective tape to forklifts, bumpers, trailers, and other machinery Provide regular training to prevent forklift or machine accidents or injury

A company-wide safety culture can improve compliance with safety requirements and rules. A safety program should be consistent and easy to understand, and the rules should be easy to follow. Requesting employee feedback gives you an inside look at the efficacy of a safety program, and allows you to adjust as required.

5) Monitor Effectiveness

Risk management requires continuous improvement, which means you must remain vigilant. Adjusting to prevent or reduce risk doesn’t mean other risks disappear. Determine how effective your risk management strategy was, continue to audit to gauge success, and begin the process again to ensure new risks are identified.

Some of the same methods used to identify risks can also help monitor success. Audits and inspections can shed light on how effective strategies have been. Auditing methods may include self-audits at the beginning of an employee’s shift, hiring a third-party agency to assess, or examining implemented techniques to determine success. After strategies have been put in place, encourage feedback from employees to ensure the methods are working as intended. Additionally, track new accident reports compared to reports from before adjustments were made to determine if there has been a reduction in incidents.

These Risk Management steps can help identify, mitigate, and monitor risks within industrial facilities, but they are only one part of a safety program. Refer to our Resource Center for more how-to guides, videos, information, and materials to help improve onsite safety.