What are three ways that research can be conducted for risk-related issues For each way, briefly describe how it may be done. Fishbone checklists and brainstorming are both tools that can be used in risk management. Describe each of these and when they would best be used.
What are the five stages of risk likelihood Briefly describe each one. List and give an example for each of the five levels of consequence for risk. What needs should be considered when treating risk List and describe three treatments that could be considered.What should be included in a risk action plan Describe the key inclusions and briefly the type of information included with each inclusion.How does the AS/NZS ISO 31000:2009 Risk management principles and guidelines standard assist organizations to reduce risk Describe the intent of each and how it could impact on the process of managing risk.
Risk review report is the report which includes various aspects which could be harmful for the organization’s current performance as well as for the future performance also. Those factors should be reviewed as fast as possible and within the possible time, it should be removed from the environment of the business. A2Z Solutions Pty. Ltd. is planning to open a new store and for the same they are bit curious to gather information in relevance to the risk factors available in the marketing environment of the particular place. A risk review report must consider the market trends; it’s primary and secondary competitor’s analysis in relevance to their adopted strategies, rough marketing plan, etc.
Risk review report is the evaluation of the all the risk factors which are present in the business environment of the particular place hence, to deal with that situation, all the activities should be performed as per the standards and benchmarks setup by the management of the A2Z Pty. Ltd. One of the major standards i.e. ISO 31000:2009 is the standard under which all principles and guidelines are provided for evaluating risk factors through risk assessment programs. Every organization performs this step to gather the required information in relevance to the risk assessment so that adequate research could be made for removing the effects of those risk factors (Lim, et. al., 2013).
Risk assessment includes the evaluation of internal as well as external factors of the organization as internal factors includes factory workers strikes, lack of administrative activities, etc. whereas external factors of risk management report includes the suppliers strike, economic conditions of the country’s market places, etc. These factors should be included in the risk review report for the better understanding of the business environment of the Toowoomba, Brisbane and it also helps in the formation of the policies and methodologies of working there.
While evaluating risk assessment procedure, all the relevant risk factors should be reviewed so that while submitting the report to the CEO and to the other board of directors of the organization, they could not get any chance to question the risk review report on the basis of standards and methods used for presenting and developing report. A2Z Pty. Ltd. has shown their trust on an existing assistant manager of their store for the position of manager as the first charging position of the store in Toowoomba, Brisbane. So keeping this thing in the mind, he should perform his best and extract every single aspect which is related with the risk factor and can harm the business (Li, 2014).
A2Z Pty. Ltd. is a company which deals in the retail stores and they have a number of the kind of stores and management along with the CEO is planning to take over another store in the Toowoomba, Brisbane, hence there are a lot of risk factors involved in the retail business such as large number of stores hence, the more occurring factor will be pricing of the products and the economic conditions also falls under the term risk factors for the retail store industry (Haimes, 2015).
PEST Analysis of A2Z Pty. Ltd
This technique analyzes the political, economic, social and technical factors of environmental framework for describe the strategic management of the organization.
Political: Government policies, tax policies, etc. are included under political factor. Impact of these policies on the performance procedure of the organization is included under this technique.
Economic: General economic rate of the country, inflation, interest rates, etc. are the parts of this factors. The impact of these factors over the performance of the A2Z Pty. Ltd. will be such as increase in the inflation rate may decrease the sales of the organization.
Social: Age, sex, population, etc. are included under this factor and their impact over the A2Z Pty. Ltd. performance will be affected when these factors’ will rise up and vice versa.
Technical: Organization’s more than half activities are dependent on the technologies and these technologies also need to be amended timely to gain the adequate performance.
SWOT Analysis of A2Z Pty. Ltd.
· The strongest point of the A2Z Pty. Ltd. is that they are surviving in the retail store industry from a long run.
· Adequate team members and other talented and experienced employees in all retail stores also form strength for the A2Z Pty. Ltd.
· They provide lot of varieties of products under one roof due to which customer does not need to rush to other stores for purchasing other products (Tummala & Schoenherr, 2011).
· Their pricing strategy also form strength for them as they purchase directly from the manufactures hence intermediates and their profit margin reduces.
· In Toowoomba, they do not have brand image, as setting up a good image will consume time.
· Dealing with existing branded retail stores which have places their strong position in the retail industry.
· Matching up with their pricing strategy and lack of knowledge in relevance to the economic conditions of the Brisbane market.
· Lack of internal controls over the activities of the business and lack of adequate monitoring measures also forms weaknesses for the A2Z Pty. Ltd.
· New appointed manager could perform market research technique to perform better in the new marketing conditions.
· Adequate promotional and advertisement measures could be adopted for the promotion of the retail store in the Brisbane.
· An existing store is being taken over by the A2Z Pty. Ltd. in Toowoomba, Brisbane hence, their goodwill and their customers could be attracted easily for setting up the base model of developing goodwill.
· Existing retail stores could be the biggest threats for the organization in settling down and maintaining their place in the competitive market.
· A2Z have their own manufactured products too hence, development of their substitutes and their copying is also a threat for the organization.
· If bargaining is supported by the other competitor then A2Z store should also need to evaluate this technique to match up their competitors’ level.
Table of Stakeholders
Role in Process
Stake in Process
Government agencies develop the policies, legislation, according to which all the activities of the organization should be performed to avoid interruption in the performance of the organization. Hence new appointed manager needs to consider these legislation and policies while confuting business activities in the Toowoomba’s store.
Government agencies of certain places help the new and existing business entities in terms of giving guidance of rules and regulations of the country. They also support financially to the industries and business enterprises for their expansion as well as for their better growth.
Directors are responsible for taking decisions on behalf of the organization. Directors along with the CEO of the A2Z Pty. Ltd. have chosen to promote the assistant manager of other store for the position of the manager for the new Toowoomba store.
Directors play the role of government internally as they also set rules, regulations and they also set benchmarks for the organization for performing the activities under control.
CEO will be the responsible party of the store’s activities and final decision taking authority also lies with him. Achievements or unethical practices, for all the practices of the retail stores under the name of A2Z Pty. Ltd., CEO will be held as responsible.
CEO will review the risk assessment report prepares by the new manager appointed for the new store in Toowoomba to evaluate his and organization’s decision of moving towards Brisbane for the expansion of the business.
Suppliers are the people who deliver the stocks to the organization and relationship with the supplier and the organization should be maintained good so that they never misrepresent or never delay in delivery of the goods.
They are responsible for sending goods to the store and they should be treated adequately in terms of making their payments so that they could not perform any kind of misconduct with the organization.
Summary Notes to the CEO
Please accept kind greetings from new appointed Manager for the A2Z Pty. Ltd. Toowoomba, Brisbane store.
I have developed the risk assessment report for the new store through evaluating all the risk factors present there in terms of competitors, their strategies, etc. Risk assessment report is developed considering the requirements of all directors and yours. This report will help the organization to develop a great image in the public of the Toowoomba and in terms of completion also, A2Z Pty. Ltd. will achieve its desired objectives and goals. This also concludes the growth opportunities for the retail industry in the new place and as per the conditions of the market there, it is the best time to set up a store as other retail stores are not able to fulfill the demands of the consumers.
All the relevant details along with the risk review report, table of stakeholders are sent to the directors and to the all stakeholders through email. Your reviews regarding the report will be acceptable.
Thank you for the greatest opportunity.
Email to stakeholders
With the concentration of the decision taken by the CEO and by the mutual consent of all the directors, assistant manager of one of the stores has been decided to promote at the place of manager for the new store that is soon initiated at Toowoomba. Manager of the new Toowoomba store was asked to prepare risk review report to evaluate the risk factors present in the new place where A2Z Pty. Ltd. is planning for its business expansion. Hence, he has completed his assessment so you all are cordially invited for reviewing this report to undermine the decision taken for the promotion of the assistant manager is up to the mark or not.
Risk Analysis and Management Plan
Risks are the major threat for every organization and to overcome from this situation, organization along with its experienced employees prepares a report in the name of risk assessment or risk analysis report. Under this report all kinds of risk occurrence factors and other probabilities are evaluated. As per these occurrences, risk management plan is prepared in which all the possible methods and procedures are included to face the risk and their effects (Chang, et. al., 2010).
Types of Risk present in the Toowoomba
As per the Porter’s model of risk evaluation, in every industry these certain risk factors are available especially for a new store or business which is about to be initiated in the place other than its native place. These are:
Threat of new entry of organizations: Every organization when set up its business in certain place for performing in terms of delivering the satisfactory products and services of the consumers for building reparation of the organization. In Toowoomba, retail industry is very much developed and a lot of retail sector enterprises are present due to which sometimes, organizations needs to face aggressive competition. Manager of the Toowoomba store firstly analyzes these factors because in the place where a lot of retail industries already exists, chances of commencement of other entities are also possible but it could be accepted as population of the same place is rising with a rapid growth. Hence, entry of the new entities could be the great threat for the A2Z Pty. Ltd. in Toowoomba, Brisbane (Ilie & Ciocoiu, 2010).
Threat of Substitutes:A2Z Pty. Ltd. is very old in the retail industry business and they have also occupied number of stores in their native place as well as in the other parts of the country. Their main reason of success is that they have their own manufactured brand also under which lot of food products and other basic necessities products are sold. These products are of great quality in terms of other products of different products. In a new place, competitors will also try to adopt this technique and if they would achieve success in manufacturing the substitutes of those products then it would also become another big threat for the A2Z Pty. Ltd.
Bargaining: In retail industry channel, this factor affects a lot to the business’ performance and their profit margin also gets affected due to this. For instance, if in Toowoomba, other industries are promoting this practice then, customers will prefer the store in which they have the chances of getting the products on low prices in comparison to the fixed price store. Hence, A2Z Pty. Ltd. needs to reduce its profit margin for reducing the prices of products and for beating its competitors’ policies or they could also adopt the bargaining policy.
Industry Rivalry:This factor of risk assessment evaluates the techniques adopted by the organization for improving the services and products delivered to the consumers. It includes the adaptation of advanced techniques and machinery, expenses on promotional campaigns to reduce the business of competitors, etc. These are the extra expenses for every organization and it will directly affect the profits of the organization. Hence this also rises in the form of risk for the A2Z Pty. Ltd. (Brazel, et. al., 2010).
In a business environment, all of risk factors or say risks are present which could affect the performance of the business and due to which businesses may need to face loss or probability of shut of business enterprise also rises in those situations. All these risks factors discussed above could affect the profitability of the organization as well as it could also affect the overall performances of the business. Likelihood determines the occurrence of the risk in the business environment. If it is applied in the scenario of the A2Z Pty. Ltd. for assessing the risks for the Toowoomba store then the threat of new entry of organizations as well as the threat of producing substitutes constitutes great and high level of occurrence which could affect the performance of the business to the large extent. Whereas bargaining power of consumers and suppliers are the traditional approaches of risk evaluation because consumers also prefer the store from where they could get the products at fixed and fare price as this is a time consuming policy as well as customer relationship with store also builds up due to this action. Suppliers bargaining power exists where limited number of sellers of raw materials, labors, etc. are available and Toowoomba is big place where number of sellers for everything exists. Hence, the occurrences of these two risk factors are quite low.
Consequences of Risks
Consequences of risks could bring negative as well as positive situation, generally it brings only negative situation. Impact of risk could be brought down but it cannot be reduced from the root. For instance, consequences of risk related to the economic as well as environmental conditions of the market of the Toowoomba will be discussed. Unfortunately after setting up the store by A2Z Pty. Ltd., with the great impact of earthquake in the Brisbane destroys most of the markets as well as new settled store was also destroyed. Due to this organization needs to face a great loss and that loss was reduced with the claim received from the insurance company (Azfar, et. al., 2012).
Another instance could be downfall in the economic conditions of the Brisbane results in the inflation and due to which people were avoiding sending on excessive products and they were saving for meeting with future expenses. This situation also reduces the business of the new store settled recently by A2Z Pty. Ltd.
Risk Calculation Table
Type of Risk
Threat of new entries
Threat of substitutes
Customer’s tastes & Preferences
These are the certain risk factors evaluated as per the analysis performed by the new manager appointed a due to which these risks have been given certain ratings. This is performed for measuring the affectivity of the different types of risks. As per their severity, adequate measures will be included in the risk management plan to control the risk’s effects in the organization.
Treatment of Risks
Threat of new entries of business organizations: This can be avoided by adopting adequate measures through which business of the firm does not get affected much. Using Effective promotional techniques could be the first option for treating this risk for A2Z Pty. Ltd. Advertisement and promotional techniques should include the offers and other attractions through which they could develop their image in the customer’s mind. The other option for avoiding the settling down of the new entities could be maintaining the customer relation with the consumers so that new entities admission could not affect the A2Z Pty. Ltd.
Threat of producing substitutes:This type of risk could be saved from adopting the advanced techniques to keep the secret formula of manufacturing of own goods which are more demanded in market. The particular are should be restricted so that only authorized person could move in the area where all the methods and ingredients used for producing goods are taken. The other option to save the effectiveness of this kind of risk is that maintaining the quality of the products extreme so that no one could be able to maintain the same quality at the certain price.
Economic and Environmental conditions:The effects of these risk factors could be saved by adopting the way of insurance policy as this is the best option through which these risks’ affectivity could be lower down. Other option of treatment of this type of risk is that these could be ignored, accepted and transferred as per the situation. In ignorance of the risk, risk is ignored hence impact of risk does not bring any change in the organization’s performance. In acceptance of risk, risk is accepted and all the impacts of that risk are also accepted as this affects the business of the organization a lot. In transfer of the risk, risk is being transferred to the person or the organization that can pay for the same risk. In the loss from uncertainty factors, organization claims for the insurance claim and they pay for the same, this is the example of transfer of the risk (Mertens, 2014).
Risk Management Plan
Banking risk (theft of cash left in the premises)
Transferred to the insurance company if theft is of huge amount otherwise investigation will be performed to determine the culprit.
CCTV cameras and other advanced techniques could be used for monitoring these kinds of risks.
On urgent basis.
Initially financial controller will be responsible because keeping the cash in the premises is not acceptable.
Manager’s travel risk (physical injury)
Adequate safety measures and proper care should be taken while travelling as whole work will be stopped in the absence of the manager.
Assistant and other supporters should be given to the manager for the performance of the irrelevant and unimportant and small tasks.
On urgent basis
A2Z Solutions Pty. Ltd. board and CEO are also responsible.
Law Compliance Risk (reputation/brand loss and fines).
Adequate measures such as promotional techniques, distribution of free samples, etc. could be used for controlling this kind of risk factors. Adequate policies should be made so that performance of the organization could meet the legal as well as ethical considerations of the particular place.
For building customer relationship, attractive offers that could attract the consumers should be adopted. Along with this pricing strategy should also be adopted with an adequate rate of profit so that customer’s trust could be build up towards the organization.
Within 3 months of commencement of business.
Goldsmith Partners, CEO.
What are three ways that research can be conducted for risk-related issues? For each way, briefly describe how it may be done.
Following are the ways through which research for the risk related issues could be conducted:
Qualitative Analysis:This analysis evaluates the risk factors in terms of the numerical or in the form through which actual severity of the risk could be measured. According to this method of research related to the risk factors, only relevant issues are analyzed.
Semi-quantitative Analysis: Under this technique of evaluating the issues related to the risk, numeric values are used which is calculated by using an adequate method or procedure as per the requirement of the organization.
Quantitative Analysis:This technique uses both formulas of evaluation of the risk as in this method; numeric as well as grading feature is included. Generally these grades are obtained from the original source of the information.
Fishbone checklists and brainstorming are both tools that can be used in risk management. Describe each of these and when they would best be used.
Fishbone Checklist: Under this technique of risk management, all the possibilities of the issues are raised. In other words, from the root cause, the effect of risk is evaluated for using the effective and adequate strategies to deal with those issues. Along with this feature, this technique also being used when large of number of risk factors is involved.
Brainstorming: Under this technique variety of ideas are determined as the solution for the issues faced by the organization. This is a long process and time consuming process but it is worthwhile. Amongst those ideas, one of the best ideas as the solution is used to face with the issue from which organization is struggling.
What are the five stages of risk likelihood? Briefly describe each one.
Following are the five stages of risk likelihood:
Determination of destruction: Firstly, all the factors should be analyzed through which organization may need to survive. These could be internal as worker’s strikes, financial issues, etc. and external as environmental conditions, economic conditions of the place, etc.
Impact of Risk: After evaluating the factors of risk internally as well as externally, their impact over the organization needs to be determined to develop the adequate policies and methods to deal with them (Covello & Merkhoher, 2013).
Develop Methods: Appropriate and adequate methods needs to be developed for treatment of the risk factors and those methods should be in relevance to their legislative, ethical, etc. requirements.
Analyze the other unimportant factors: Other factors of the risk assessment should also be reviewed so that appropriate measures could also be made for them.
Review the plan:Under this step, all the policies, methods and other relevant factors needs to be evaluated appropriately and if any error found, remove them.
List and give an example for each of the five levels of consequence for risk.
Consequences of risks are:
Very High: These factors have the huge effect over the performance of the organization. In other words, they create huge losses or shut down situation of the business. For instance, lack of control over the financial activities could bring the lack of capital in the A2ZPty. Ltd.
High: These are the factors which have great effect over the business activities but could be managed or controlled by implementation of certain methods. For instance, substitutes produced by the competitors of A2Z Pty. Ltd. but quality measures were not adequate as secret formula for manufacturing those products is situated at the safe place.
Medium:Organization could perform its activities after certain event. For instance, fire occurred in the organization premises.
Low: The factors involved in this category could be ignored as well. For instance, small amount stolen from the petty cash fund.
Insignificant: Strike by the one worker.
What needs should be considered when treating risk? List and describe three treatments that could be considered.
Ignorance of risk: Firstly risk should be ignored to the extent it does not harm the organization’s performance. Ignorance of the risk is the best method of treating the risk as there is no harm reaches through this type of risk. For example, strike by one worker amongst the team of 1000.
Acceptance of risk: Under this technique, risk should be accepted and appropriate treatment should be given to avoid the disturbance in the performance of the organization. For example, strike of more than half workers in the organization.
Transfer of risk: In this treatment methodology of risk, it is being transferred to the person or the third party that pays off for the damage done from the risk. For example, fire occurred in the premises and risk is being transferred to the insurance company to pay off the damages done from the fire.
What should be included in a risk action plan? Describe the key inclusions and briefly the type of information included with each inclusion.
In a risk action plan, risk factors, methods to reduce the effects of risk, methods for removing the occurrence of the factors of other relevant factors of risks should be included.
Description of the risk factors are the key elements of the risk action plan along with the methods for removing the effects of those risks factors. The methods through risks implications could be reduced should also be reduced. Factors of treating the risk as per the severity should also be included in the risk action plan. These factors are ignorance of the risk, acceptance of the risk and the transfer of the risk. In all of these factors of treatment of the risk are implied with the help of assessing the severity of the risk. Firstly risk should be ignored and then it should be treated to avoid the glitches in the performance of the organization (Kotzab, et. al., 2011).
How does the AS/NZS ISO 31000:2009 Risk management – principles and guidelines standard assist organizations to reduce risk?
This standard implies the procedure through which the risk assessment and risk review report is prepared. This standard also determines the internal policies regarding the decisions taken for the treatment of the risk. All the procedure of the risk should be properly examined and the methods through which the risks are treated should be recorded systematically and structured of them should be adequate as per the policies and rules of the organization. ISO 3100:2009 states the principles regarding the principles and guidelines of implementation of the methods for reducing the impacts of the risk and risk management techniques are included (Purdy, 2010).
Impact of the privacy law on the impact of managing risk determines the evaluation of the risk factors through the guidelines and the policies of the legal aspects of the particular place. This technique also determines the activities performed under the evaluation of the risk assessment should be in consideration towards the privacy law.
Work health and safety regulations determine the codes of conduct of working procedure in the Australia. Under this act, every organization registered under this act needs to be following all the guidelines issues by this law for commencement of the working activities in health and safety organization.
Contract law determines the features of the different situation that may arise in the contract between two parties for performing a certain activity, it includes:
Information of both the parties
Content of the activities
Obligations of the contract
Role of both the parties
Cures in the situation of breach of contact.
Name and give an example for three adjustments that can be made in the workplace to assist a person with a disability.
Adequate equipment should be provided to the people admitted in the workplace
Training and counseling sessions for using that equipment.
Hygiene and safety considerations
List two types of insurance an organization could consider purchasing, and for each type, describe the risks covered by the insurance and the benefit to the organization.
Personal Insurance for workers: Under this insurance policy, organization’s workers get an assurance for the survival of their family members after their death due to an accident in the workplace. This helps the employees to build trust towards the organizations’ policies of treating the employees.
Special insurance: This insurance is taken for the important employee of the organization who is responsible for the major tasks of the organization and his/her body parts are the code of entering that restricted area. For instance, an employee’s eye insurance is taken because employees’ eyes are the method of entrance in the administrative department of the organization.
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Brazel, J.F., Carpenter, T.D. & Jenkins, J.G., 2010, “Auditors’ use of brainstorming in the consideration of fraud: Reports from the field”, The Accounting Review, vol. 85 (4), pp.1273-1301.
Chang, L., Tong, K. & Ameen, V., 2010, “Ischemic colitis and complications of constipation associated with the use of alosetron under a risk management plan: clinical characteristics, outcomes, and incidences”, The American journal of gastroenterology, vol. 105 (4), pp.866-875.
Covello, V.T. & Merkhoher, M.W., 2013, “Springer Science & Business Media”, Risk assessment methods: approaches for assessing health and environmental risks.
Ilie, G. & Ciocoiu, C.N., 2010, “Application of fishbone diagram to determine the risk of an event with multiple causes”, Management Research and Practice, vol. 2 (1), pp.1-20.
Kotzab, H., Munch, H.M., de Faultrier, B. & Teller, C., 2011, “Environmental retail supply chains: when global Goliaths become environmental Davids”, International Journal of Retail & Distribution Management, vol. 39 (9), pp.658-681.
Li, W., 2014, “John Wiley & Sons”, Risk assessment of power systems: models, methods, and applications.
Lim, S.S., Vos, T., Flaxman, A.D., Danaei, G., Shibuya, K., Adair-Rohani, H., AlMazroa, M.A., Amann, M., Anderson, H.R., Andrews, K.G. & Aryee, M., 2013, “A comparative risk assessment of burden of disease and injury attributable to 67 risk factors and risk factor clusters in 21 regions, 1990–2010: a systematic analysis for the Global Burden of Disease Study 2010”, The lancet, vol. 380 (9859), pp.2224-2260.
Mertens, D.M., 2014, “Sage publications”, Research and evaluation in education and psychology: Integrating diversity with quantitative, qualitative, and mixed methods.
Purdy, G., 2010, “ISO 31000: 2009—setting a new standard for risk management”, Risk analysis, vol. 30 (6), pp.881-886.
Tummala, R. & Schoenherr, T., 2011, “Assessing and managing risks using the supply chain risk management process (SCRMP)”, Supply Chain Management: An International Journal, vol. 16 (6), pp.474-483.
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