Risk Management Question Answer 2022

Running head: RISK MANAGEMENT
Risk Management
Name of the Student
Name of the University
Author notes:

1RISK MANAGEMENT
Table of Contents
1. Define the term RISK, using a suitable example..................................................................3
2. Define the term RISK MANAGEMENT.............................................................................3
3. What are the 10 principles of risk management (the 10 P’s)?..............................................4
4. Outline 3 different ways you can alert people to potential hazards and risks in the
workplace.....................................................................................................................................6
5. When determining the level of risk within an organization, where would you gather your
information from?........................................................................................................................7
6. Outline a strategy that you could implement to interest people / employees the companies
risk management process. Be sure to detail how you would maintain the currency of
information provided...................................................................................................................7
7. Outline a strategy that could be used to ensure participatory arrangements are established
and maintained with employees and their representatives within a small business. Be sure to
include how you would document this process and make the information available to all
employees to ensure you meet legislative requirements..............................................................8
8. Outline the process you would use to ensure that any issues raised through participative
arrangements and consultations are dealt with and resolved promptly and effectively?.............9
9. You are to detail how you would identify an intervention point for expert risk
management advice. Be sure to provide examples of when you would seek expert advice, and
who you would contact to receive such advice...........................................................................9
10. Outline the Hierarchy of Control, explaining how it affects your suggested control
measures....................................................................................................................................10

2RISK MANAGEMENT
11. Describe AS/NZS ISO 31000:2009 Risk Management - Principles and Guidelines.....11
12. Describe the documentation retention policy that applies to risk management
paperwork..................................................................................................................................12
13. What information should you include in your risk management action plan?...............13
14. Describe the steps you would take when implementing a risk management action plan.
14
15. Describe the steps you would take when monitoring your risk management action plan.
14
16. Describe the steps you would take when evaluating your risk management action plan.
15
17. What are the 5 main risk types that face businesses?.....................................................15
18. Following from the previous question, you are to provide an example of a risk and a
risk management strategy for each risk type.............................................................................16
REFERENCES..............................................................................................................................17

3RISK MANAGEMENT
1. Define the term RISK, using a suitable example.
Ans. The word risk refers to the possibility of an incidence that might lead to the development of
an incidence that is characterized by potential loss of any aspects associated with factors such as
physical, social or financial capital or property1. The property or assets that can be potentially
lost through the incidence of the risk can be intangible or tangible in nature. Hence, it must be
noted that risks are not limited to loss of tangible capital, property or assets.
It can be said that an event is said to be risky or associated with a certain risk according to the
perception of individuals depending on how they interpret the situation. The scope of risk depend
on the viability of the incidents that the risk is concerned with.
Following are examples of risk. Leakage of Liquid Petroleum Gas in a kitchen is deemed to be
risky. There arises risk of fire outbreaks as the kitchen deals with extensive use of fire and
flammable items.
People are given life jackets when they board boats or Rafts. This is done to ensure that the latter
are can be protected from the risk of drowning.
2. Define the term RISK MANAGEMENT
Ans. It is evident that regardless of the nature of activities that an individual, a group of
individuals or an organization is associated to, there might be uncertainty regarding the incidence
of risk that might arise at any moment. Hence, there is a need for controlling or avoiding the
risks that might lead to potential loss of tangible or intangible resources or property. The process
of identifying the risks and investing effort into the same in order to avoid the consequences of
1 Connor, M.J., Springford, L.R., Kapetanakis, V.V. and Giuliani, S., 2015. Esophageal atresia and transitional care
—step 1: a systematic review and meta-analysis of the literature to define the prevalence of chronic long-term
problems. The American Journal of Surgery, 209(4), pp.747-759.

4RISK MANAGEMENT
the same is known as risk management2. Inclusion of risk management in activities associated to
the operations of an organization is crucial as it help in ending an issue in a positive way, reduce
the possible losses. There are various steps that are included in the process of risk management.
Following are the components of a risk management plan;
i. Planning regarding management of the risk
ii. Identification of the risk
iii. Qualitative and Quantitative Analysis of the risk
iv. Response planning regarding the risk.
v. Controlling and monitoring of the risk.
If the Risk management can be completed in an effective manner it can be ensured that there is
effective use of the resources, there is incidence of promotion of continuous improvement,
reduced number of losses and failures and incidence of strategic business planning.
3. What are the 10 principles of risk management (the 10 P’s)?
Ans. There are various principles that are associated with risk management. All the mentioned
principles have considerable amount of significance regarding the aspects that they are covering.
There are 10 principles associated with risk management and they are as follows3;
i. Policy: In the process of risk management, there should be policies that protect the
concerned organization, party or individuals with the help of policies that cater to the
need of health, investigation of accidents, effective management of wastes, opportunities,
competition and financial risks.
2 Glendon, A.I. and Clarke, S., 2015. Human safety and risk management: A psychological perspective. Crc Press.
3 Gitman, L.J., Juchau, R. and Flanagan, J., 2015. Principles of managerial finance. Pearson Higher Education AU.

5RISK MANAGEMENT
ii. Planning: One of the most important principle without which the other principles would
not be viable. The planning phase is stage in which the aim of the company in terms of
the identification of the risk is catered to apart from the development of the activities
associated to the effective management of the risk.
iii. Products: The product principle deals with the development of the risks that are
associated in the process of management of the product or service. Issues such as
management of the product life cycle and the waste management are some factors that
deals with the product or service.
iv. Process: This principle revolves around factors such as potential impact of the
technological factors, the techniques that are used by the company, the skill of the
workforce and the function of the management that caters to the viability of the ongoing
processes of the organization.
v. Premises: This principle is associated with the development of factors such as size of the
plant or firm, the availability of facilities to cater to the risk, the location and health
factors that are associated to the same.
vi. People: The people principle revolves around the number of workers present in an
organizational setting, the degree of motivation of the latter, the competencies of the
workers associated to the organization and the legislations that are followed in order to
ensure minimization of risk.
vii. Protection: Concerned with the protection of people, materials, the intellectual rights,
security and data essentials along with the premises in which the data is being preserved.
viii. Procedures: This involves the management of the effect of the procedures in terms of the
development of the activities associated with the effectiveness and rationality of the

6RISK MANAGEMENT
procedures associated with the development of the latter in the organization in or in the
aspect in which the risk is being managed.
ix. Purchasing: The purchasing policy of the firms is associated with the purchasing that is
carried out by the firm in terms of the quality of the materials that is being purchased by
the firm, the time of delivery of the latter, the nature of the materials that are being
sourced and the sustainability issues that are being catered to in the process.
x. Performance: The organization is ultimately liable to its stakeholders for all the
operations that have been carried out by the organization including the management of
risk. Thus, the said principle revolves around the evaluation of the performance that is
carried out by the organization.
4. Outline 3 different ways you can alert people to potential hazards and risks in
the workplace.
Ans. The treatment of the hazards determines in the nature of the same. The potential of the
hazard in terms of the risks that are posed by the same in the workplace determines the
techniques that will be used to alert people in the workplace during potential hazards. The 3
common ways to alert people in the workplace are:
i. Through intercom speakers installed in the facility,
ii. By firing the alarms
iii. By sending individual text messages or emails.

7RISK MANAGEMENT
5. When determining the level of risk within an organization, where would you
gather your information from?
Ans. In order to determine the level of the risk, one should follow the Risk Severity Matrix 4. The
latter is the assimilation of factors such as likeliness of the risk along with determination whether
the concerned risk is critical, moderate or minor. Based on the position of the risk on the risk
severity matrix one can arrive at a decision that can determine the level of the risk.
6. Outline a strategy that you could implement to interest people / employees the
companies risk management process. Be sure to detail how you would maintain
the currency of information provided.
Ans. Risk management should be incorporated into the regime of every company regardless of
the nature of operations of the same. The aim of the company should be to incorporate risk
management into the grass root level of every organization. It would help in ensuring the fact
that risk would be effectively managed in the concerned organization. In order to interest the
employees of the organization into risk management activities the following strategy should be
followed;
Appropriate cultural setting: The culture of an organization determines the viability of the
operations that are taking place in the organization. It should be the aim of the management of
the company to ensure that the culture is characterized by a clear communication framework and
a grievance redressal procedure. This will encourage the employees in terms of effective
management of the risks associated with the operations of the employees.
4 Mahamid, I., Al-Ghonamy, A. and Aichouni, M., 2015. Research Article Risk Matrix for Delay Causes in
Construction Projects in Saudi Arabia. Research Journal of Applied Sciences, Engineering and Technology, 9(8),
pp.665-670.

8RISK MANAGEMENT
Responsibilities and rewards: It should be ensured that the roles and responsibilities of the
employees are clarified in order to ensure that the employees are able to treat risks according to
merit. Effective treatment of the risk should be backed by rewards that will hopefully encourage
the people in terms of effective risk mitigation.
7. Outline a strategy that could be used to ensure participatory arrangements are
established and maintained with employees and their representatives within a
small business. Be sure to include how you would document this process and
make the information available to all employees to ensure you meet legislative
requirements.
Ans. In order to carry out the development of participatory arrangements for the employees, it
should be ensured that all the terms and conditions are laid down effectively with considerable
amount of information for the employees in order to inform the latter about the methods they can
apply to deal different types of risk5. In small organizations, the information can be made
available by putting up the regulatory and participative information on wall of the facility. It
should be ensured that all the said guidelines are mentioned in the process associated with the
informative agreements that will be sent to the employee through email. Records of the same
needs to be kept in order to ensure that no employee is missed out while the operations are being
carried out in the concerned organization. The compliance with the legislative requirement must
be clearly stated in the agreements that would be presented to the employees through email.
5 Bartenberger, M. and Sześciło, D., 2016. The benefits and risks of experimental co‐production: The case of urban
redesign in Vienna. Public Administration, 94(2), pp.509-525.

9RISK MANAGEMENT
8. Outline the process you would use to ensure that any issues raised through
participative arrangements and consultations are dealt with and resolved
promptly and effectively?
Ans. In order to ensure the issues that have been raised through participative arrangement and
consultations are dealt with promptly and effectively, it needs to be ensured that the culture of
the organization is characterized by a framework of communication. Availability of a smooth
grievance redressal system would help in effectively catering to the needs associated with the
development of the issues that have been raised through the participative bargaining session or
consultations6. The viability of the resolution of the issues would depend on the nature of the
communication through which the employee can communicate regarding their potential
grievances to the higher levels of the management who will be ultimately liable for the
development of resolutions for the risks that have been identified or brought into the attention of
the latter.
9. You are to detail how you would identify an intervention point for expert risk
management advice. Be sure to provide examples of when you would seek expert
advice, and who you would contact to receive such advice.
Ans. In terms of management of issues associated with a certain risk, it needs to be ensured the
organization seeks the help from form a subject matter expert. It is the role of the latter to ensure
that they are able to effectively use their expertise in order to mitigate the risks that have been
identified by the organization who has opted for their service. While the latter is operating in
terms of risk management in the concerned organization, the management of the organization
have to intervene in certain parts of the operational policy that has been adopted by the risk
6 Bartenberger, M. and Sześciło, D., 2016. The benefits and risks of experimental co‐production: The case of urban
redesign in Vienna. Public Administration, 94(2), pp.509-525.

10RISK MANAGEMENT
management expert. The Approval part of the risk management cycle is the part that must be
catered to by the management of the company in order to find out whether organizational
policies are being followed while the risk is being managed in the concerned organization. E.g.;
if the mitigation of risk requires halting of a crucial process of the operational activities of the
organization, it might harms the operational competency of the organization. Hence, intervention
would be needed in the latter which would be either approved or unapproved.
10. Outline the Hierarchy of Control, explaining how it affects your suggested
control measures.
Ans. The hierarchy of control refers to a hazard control mechanism used in organizations to
reduce the potential impact of hazards that have been encountered by the latter during operations.
The hierarchy of control is the assimilation of factors that are presented in the form of a
hierarchy that determines the severity of the control measure and the nature of the risk that
becomes a reason behind the treatment of one issue over another7. The hierarchy is assimilation
of factors such as Personal Protective Equipment or PPE, Administrative controls, Engineering
controls, Substitution and elimination. In the current mode of control, the aspects that are
applicable are PPE, Administrative controls and Elimination as the scope of the same is
concerned with the development protection of the employees, changing the nature or mode of
working of the people and physical removal of the hazard. The hierarchy of control should be
implemented by mangers and experts who are associated with the risk management.
7 Patsias, C., Latendresse, A. and Bherer, L., 2013. Participatory Democracy, Decentralization and Local
Governance: the M ontreal Participatory Budget in the light of ‘Empowered Participatory
Governance’. International journal of urban and regional research, 37(6), pp.2214-2230.

11RISK MANAGEMENT
11. Describe AS/NZS ISO 31000:2009 Risk Management - Principles and Guidelines
Ans. According to AS/NZS ISO 31000:2009 Risk management, the following principles have
been laid down by the Australian and New Zealand risk management standards8. The new
standards replaced the risk management standards that were established in 2004.
Following are the principles and brief explanations of the same;
i. Creation and Protection of Value: Effective management of risk by following the
objective established ensuring generation of value.
ii. Being an integral part of the operational policies: Integration of risk management into
operational policies of companies.
iii. Part of the decision making process: Risk management should be taken into
consideration while in the process of decision making.
iv. Addressing uncertainty: Should be able to identify the potential risks that might be
encountered while in operations.
v. Structuring the process: The process of risk management should be structured, based on
systematic functionality and must be time bound.
vi. Suitable information: The management of risk should be carried out with the help of
effective identification of the issues associated with the risk.
vii. Tailored: Organizations should have the competency and the capability to deal with risk
if ever encountered.
viii. Cater to cultural and human factors: Give necessary importance to cultural belonging
of people and the contribution of the latter.
8 Olechowski, A., Oehmen, J., Seering, W. and Ben-Daya, M., 2016. The professionalization of risk management:
What role can the ISO 31000 risk management principles play?. International Journal of Project
Management, 34(8), pp.1568-1578.

12RISK MANAGEMENT
ix. Transparency in communication: Clear communication with the diverse groups of
stakeholders associated with the organization on the incidence or identification of the
possible risk.
x. Flexibility and responsive: Organizations have to dynamic in the sense that they must
have the ability to cater to risks and be prepared for implementation of change.
xi. Facilitation for continuous improvement: By identifying and mitigating and
controlling the risks one can ensure that the organization that they are a part of is able to
effectively improve in operation regardless of the nature of operations.
12. Describe the documentation retention policy that applies to risk management
paperwork.
Ans. During the process of risk management every organization should maintain a list of
documents through which the organization would be able to identify the procedures that were
taken by the company on incidence of similar types of risks in the future. Following are the steps
that are needed to be taken in order to gain effectiveness regarding management of risks;
i. Maintaining inventory of all the documents that had been generated during the risk
management process.
ii. Catering to all the regulatory and legislative requirement while catering to the risk
management procedure.
iii. Evaluation of all the needs of the business
iv. Categorization of the documents according to the groups that they comply with.
v. Evaluation of the possibility of risk mitigation strategy and the viability of the same in for
future practice.

13RISK MANAGEMENT
vi. Compliance with periodic audit needs of the organization in terms of development of risk
management.
vii. Periodic evaluation and updating the policies associated with risk management.
13. What information should you include in your risk management action plan?
Ans. There are some types of information that must be included in a risk management action
plan in order to carry out the effectiveness of the risk management plan9. Following are the types
of information that must be present in a risk management action plan;
i. The actual process: The process through which the risk will be identified and will be
dealt with through the risk management plan.
ii. Budget: Information regarding the portion of the budget that will be allocated in order to
treat or mitigate a risk.
iii. Operational structure: The structure of the strategies to be taken and the nature of
operations to be carried out.
iv. Register of the risk: The register that consists of records regarding the frequency of the
risk management.
v. Structure of reporting: The delegation structure and the roles and responsibilities of the
people associated to the development of the risk management plan.
vi. Category of the risk: Segregation of the category of the risk according the risk
assessment matrix.
9 Bowers, J. and Khorakian, A., 2014. Integrating risk management in the innovation project. European Journal of
innovation management, 17(1), pp.25-40.

14RISK MANAGEMENT
14. Describe the steps you would take when implementing a risk management action
plan.
Ans. There is a process that ensures that the risk management action plan would be implemented
in a manner that can be deemed to be effective in nature. Following are the steps of
implementation of the risk management plan;
i. Identification: The first step of identification of the risk is to cater to effectively identify
the risk. This is the first step that needs to be carried out before development of the risk
management plan.
ii. Analysis: After the level, type and the nature of the risk has been identified, it is the role
of the developer of the risk management action plan to analyze the risk from every
possible angle.
iii. Evaluation and ranking of the risk: The scope of the risk should then be evaluated and
franked using a risk assessment matrix which would help in identifying the severity of the
risk.
iv. Development of the action planning: After the risk has been identified, analyzed,
evaluated and ranked, it is the role of the action plan developer to treat the risk. The mode
of treatment of the risk is through the development of the risk management action plan
which contains strategies that are to be taken in order to effectively manage present or
possible risks.
15. Describe the steps you would take when monitoring your risk management
action plan.
Ans. In order to effectively monitor the risk management plan, the following must be
incorporated into the operations of the risk assessor;

15RISK MANAGEMENT
i. Identification of the impact that the risk has on the viability of operations of the
management and the organization as a whole. This involves effect of the risk on the
potential of performance of the organization along with effective analysis of the financial
performance of the company.
ii. Analysis of the impact of the risk and the effects on the overall performance of the
organisation.
iii. Evaluation of the risks should be carried out in order to prioritise the risks depending on
the nature and scope of the same.
iv. Monitoring the risk by employing the adequate treatment measure of the risk.
v. Reviewing the nature of assessment that has been carried out during the effective
management of the risk. The effectiveness of the scope of the same is adjudged in the
said step.
16. Describe the steps you would take when evaluating your risk management action
plan.
Ans. In order to determine whether the evaluation of the risk management action plan has been
carried out in an effective manner, the management or the suitable official should check the
scope of their own evaluation. They should check whether the risk management action plan that
has been actually developed serves the purpose. It is to be checked whether the evaluation of the
risk has been catered to in a success manner and whether it has the ability to effectively deal with
the risk which a said organization is faced with or might face in the future.
17. What are the 5 main risk types that face businesses?
Ans. The main 5 types of risks that can be faced by business are;

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i. Strategic risks: Risks associated with the development of the strategies of operations of
businesses.
ii. Compliance risk: Risks that are associated with the compliance with legal and regulatory
compliances.
iii. Operational risk: Risks that are associated with the development of all the operational
activities of a business.
iv. Financial Risk: Risks that have a negative financial impact on the said the concerned
business.
v. Reputational Risk: It is challenging to general, however, it is easy to lose the developed
reputation. Reputational risks are risk associated to the loss of reputation of an
organisation.
18. Following from the previous question, you are to provide an example of a risk
and a risk management strategy for each risk type.
Ans.
Risk Type Example Risk Management strategy
Strategic Risk Marketing Risk Marketing research
Compliance Risk Environment Risk Assessment of legislations
Operational Risk Fraudulent activity Development of Strict
Policies
Financial Risk Outstanding debts. Contacting debtors for
recovery

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Reputation Risk Negative publicity Public Relations
REFERENCES
Bartenberger, M. and Sześciło, D., 2016. The benefits and risks of experimental co‐production:
The case of urban redesign in Vienna. Public Administration, 94(2), pp.509-525.
Bowers, J. and Khorakian, A., 2014. Integrating risk management in the innovation
project. European Journal of innovation management, 17(1), pp.25-40.
Connor, M.J., Springford, L.R., Kapetanakis, V.V. and Giuliani, S., 2015. Esophageal atresia and
transitional care—step 1: a systematic review and meta-analysis of the literature to define the
prevalence of chronic long-term problems. The American Journal of Surgery, 209(4), pp.747-
759.
Gitman, L.J., Juchau, R. and Flanagan, J., 2015. Principles of managerial finance. Pearson
Higher Education AU.
Glendon, A.I. and Clarke, S., 2015. Human safety and risk management: A psychological
perspective. Crc Press.
Mahamid, I., Al-Ghonamy, A. and Aichouni, M., 2015. Research Article Risk Matrix for Delay
Causes in Construction Projects in Saudi Arabia. Research Journal of Applied Sciences,
Engineering and Technology, 9(8), pp.665-670.
Olechowski, A., Oehmen, J., Seering, W. and Ben-Daya, M., 2016. The professionalization of
risk management: What role can the ISO 31000 risk management principles play?. International
Journal of Project Management, 34(8), pp.1568-1578.

18RISK MANAGEMENT
Patsias, C., Latendresse, A. and Bherer, L., 2013. Participatory Democracy, Decentralization and
Local Governance: the M ontreal Participatory Budget in the light of ‘Empowered Participatory
Governance’. International journal of urban and regional research, 37(6), pp.2214-2230.