Abstract
Operational risk management leverages a firm’s value configuration and creation. However, research
on the
scalability of operational risk management as a catalyser of value configuration and creation seems
yet elusive in most of the contemporary management studies.
To address such a gap, this research uses confirmatory factor analysis to test and validate the
underpinning null hypothesis that operational risk management spawns value configuration and
creation to spur a firm’s overall competitiveness and effective market performance. If
strategically linked to the process of value configuration and creation, findings revealed it is
during the consistent process of analysis, identification and mitigation of operational
disruptions, errors and wastes that operational risk management enhances identification of new
value drivers and the enrichment of the existing value drivers.
Subsequently, all these were found to spur improved quality excellence, process efficiency and cost
minimisation that in turn induce a firm’s improved competitiveness and its overall effective market
performance. Basing on these findings, the study concludes with a framework that businesses can
replicate when seeking to scale operational
risk management to leverage the overall effectiveness of a firm’s value configuration and creation.