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Manufacturing Risks

There are risks associated with the infrastructure of a manufacturing facility and from external sources. Manufacturing can be defined as the process of taking raw materials and creating finished products. These products range from milled parts to printed circuit assemblies, textiles, or chemicals.

Manufacturing of products and goods is typically a large portion of the gross domestic product of industrialized nations. For instance, the chemical manufacturing and production industry in the United States represents approximately 10 percent of the gross domestic product.

Risks in the manufacturing domain have increased since the Industrial Revolution. Innovations in technology and science have created modernized processes that have increased risk.

“Manufacturing risk” can be defined as an increase of the potential of loss that is created by the modernization process, particularly by innovative developments in science and technology. As the level of risk increases, processes within the manufacturing site become more hazardous. When the hazard threshold is surpassed, an incident occurs that leads to a loss.

Manufacturing risk is influenced by the technology utilized during the production process. Task preparedness, environmental conditions, and well-defined policies and procedures influence the level of risk within an enterprise.

Quantifying Manufacturing Risk

Manufacturing risk needs to be quantified, both internal and external to an enterprise. How are risks identified and quantified? There are a number of methodologies used in industry, including the following:

  • Failure mode and effects analysis (FMEA)
  • Failure mode effects and critical analysis (FMECA)
  • Hazard and operability study (HAZOP)
  • Hazard analysis and critical control points
  • Fault tree analysis (FTA)
  • Six Sigma analysis
  • Forensic engineering

Enterprises must also be cognizant of insider threats, which could be disruptive to operations and increase risk. The U.S. Department of Defense (DoD) report “DoD Instruction 5000.02” establishes guidelines and procedures for understanding manufacturing risk in military systems. The government creates Technology Readiness Levels as a tool to conduct technical assessments and quantify technology maturity and risk. The use of Mission Readiness Levels (MRLs) to “assess manufacturing readiness can foster better decision making, program planning and program execution through improved understanding and management of manufacturing risk.”

DoDI 5000.02 requires programs to assess manufacturing risk early in the design process. The government does not specific guidance in 5000.02 on how these assessments should be accomplished. The DoD and a number of companies are using MRLs as a best practice and are incorporating MRL assessments into technical reviews and audits.

In addition to risks involved with the manufacturing process, there are external factors that could increase the level of risk. For instance, natural disasters, cyber crime, fire, and terrorism could increase the level of risk in an enterprise. Vulnerability and threat assessments and hazard analyses are used by corporations to identify potential external risks. These analyses lead to the development of business continuity plans, continuity of operations plans, or continuity of government plans.

The chemical industry is guided by federal rules and regulations and corporate policy in regard to protecting facilities. Industry best practices for response to unplanned chemical releases are not widely publicized. S. Fortier and J. Volk found the following:

The threat of terrorism has expanded the definition of critical infrastructure protection and response. The government as well as private enterprises must be aware of the threats and prepare themselves to protect their critical assets. The definition of “what is a critical asset” is also being reevaluated. Society has seen new threat modes, such as the 9/11 incident, improvised explosive devices and suicide bombings, that require much better planning to prevent these types of incidents. The consequences of these new types of attacks have to be planned for so that the response mechanism is effective and efficient. Emergency and disaster preparedness planning is an evolving field of study. Mechanisms such as continuity of operations planning (COOP), indication and warning systems, and vulnerability assessments are used to plan for emergencies or disasters and identify the potential weaknesses in enterprise assets (such as policies, physical assets, personnel, procedures and methods). The government and the private sector have the requirement to protect its critical infrastructure. There are critical operations that need to operate uninterrupted, such as banking, telecommunications, the power grid or military operations. Threat models are used by the federal government and private industry to analyze, and prepare for, possible threats to critical infrastructure.

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