PRMS- Product Risk Management System
The strategy for Product Risk Management of most companies is to implement one, or more Quality Management System (QMS).
Despite growing interest in Quality the Product risks are overall not better managed and for this reason a Product risk management system (PRMS) based on 2 Levels is necessary:
1.1 Improvement of the effectiveness of the existing quality system
1.2 Improvement of current ESG Product risk management process
2.1 Extension of Quality to full scope of Quality , namely complying to (agreed) specs plus preventing harm and management of risk impact for own company and 3rd parties
2.2 Extension of the ESG compliance Product risk management system to full scope by analyzing and control all foreseeable and unforeseeable ESG Compliance product risks.
In depth analysis of Product risk losses and assessment learns that for all products and services overall the majority (>80%) of number of losses and incidents is related to Level 1. This implies that most existing quality systems should be better implemented and managed.
The overall impact of the Products risks due to Level 2 is the main reason why de consequences of Product risks are mostly not reduced effectively as impact is overall nearly comparable with Level 1.
The loss impact of individual incidents for Level 2 is higher than for Level 1. This requires a broader Product risk management approach than only focus on Quality.
ESG compliance risks are still rarely, but the financial impact for all products is mostly much higher than for Level 2 which implies another risk management focus and risk financing.
The impact for all Levels is highly dependent on the product type and conditions as markets.
PRE has a broad experiences with supporting companies to analyze their current PRMS and to improve the PRMS to the desired level by means of effective and practicable solutions.