A comprehensive approach to assess operational resilience

Abstract

This paper presents a first attempt to apply Multi-Attribute Utility Theory (MAUT) to the concept of resilience. The focus of this paper is measuring the management performance of operational resilience in an organization. Operational resilience refers to the ability of an organization to prevent disruptions from occurring as well as the ability to respond quickly to and recover from a disruption in the primary business processes. A value tree is constructed containing the attributes that\ncontribute to resilience management. Elements included are among others: understanding mission-critical processes, risk management performance, reward system, and cultural aspects. A checklist is used to measure how an organization performs on the attributes of resilience. This provides an\napproach to measure operational resilience. The checklist has been validated by auditing three organizations and through the use of case studies derived from the work of Sheffi (2005).