Enterprise Risk Management: Strategies and Practices for Effective Risk Mitigation

This report discusses the importance of enterprise risk management (ERM) in mitigating risks faced by organizations. It includes a literature review, case study of Samsung's battery issue, and analysis of traditional obstacles to risk-based safety programs. The report also highlights factors and trends impacting organizations' imperative for change and implementation of risk-based safety, and outlines the RMA's ERM framework.

Enterprise Risk
Management

TABLE OF CONTENTS
EXECUTIVE SUMMARY.............................................................................................................3
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................5
Literature Review-.......................................................................................................................5
Application of the practice or theory...........................................................................................7
Developing the risk management.................................................................................................8
Conclusion and recommendations.............................................................................................14
REFERENCES..............................................................................................................................16

EXECUTIVE SUMMARY
Risk defines as loss or injury which potentially gives major impact over any process,
business always operates in particular hazardous environment where all strategies and proper
planning helps in reducing the possibilities of risk. Present report illustrates the discussion about
the specific risks which the organizations face, those risks affects the operability of business
where it imposed certain challenges for the accomplishment of desired business goals. Report
has included the information related to risk management as how businesses could easily deploy
specific strategies against the risks which they have been facing. It has identified that enterprise
risk management plan helps the businesses to analyse the probability of risk at initial phase, so
that they proceed to develop strategy which works better against the risk and possibly reduces
the chances of loss. Where it also illustrated that ERM that basically concern with arrangement,
directing and controlling the business processes, it assists the businesses to eliminate the
deleterious impacts of the risk over organizational growth and over business functionalities.
Following report has also highlighted the certain relevant points which businesses
required to concern with in order to cope up with risks. It has taken the case study of Samsung
related to their battery issue in their smart phone device, further it also highlighted what
measures company has taken in order to deal with such issue. Report has outlined the literature
reviews where articles have been discussed where analysis for the current issues within risk
management plan is also discussed, further critique also made regarding traditional obstacles to
risk based safety programs. Further report has also discussed the factors and trends which discuss
organization’s imperative for change and implementation of risk based safety, it also highlighted
the RMA’s ERM framework. Lastly report has illustrated the risk management plan where it
highlighted the potential effects and risk.

INTRODUCTION
Enterprise risk management (ERM) a wide strategy that is used to determine the hazard
which affects the organizational business, where it also concerns with planning the potential
strategies and to prepare all arrangement that can be deployed against certain risk (Aven and
Thekdi, 2019). Operational risks are those which concern with failure of the internal procedures,
workforce errors and other cybersecurity events, it gives the potential impact over the
organizational operability, while strategic risk refers to failure of any strategy which fails in
providing the expected result, it generally occurs due to lack of depth in data as well as irrelevant
data will also weakens the base of any strategy. While reputational risk that concern with damage
that happens for organization where they lost in their business revenues due to bad reputation of
their brand, some conspiracy or other things which creates bad image of organization within
market place. Thus, it is essential to have safety measures in practice in order to overcome the
potential challenges so that business can operate efficiently (Malik, Zaman and Buckby, 2020).
Role of safety concern with organisational ability to have certain measure that works efficiently
against their risks. Current study is based on Samsung battery incidents, company is recognized
as worldwide popular company, their products has distinctive or unique image in market, where
they have numerous range of consumer in every country. Company has faced the issue where
they also confirmed the battery result as cause of note 7 fires.
Risk managers have major responsibility during occurrence of risk where they plan out
and assess whole situation in order to provide better solution that effectively cooperate with
particular scenario. Every organization have safety team which ensures the safety of their
business functions, where safety team work collaboratively in order to analyse the risk and its
hazard property so that further plan can be developed or executed accordingly (Bohnert and et.al
2019. It is important to note that every safety team member have sufficient knowledge that will
help in developing a mitigation plan. There are some instances which shows that if firm do not
have workforce which understand the risk then in such case they are seen as facing major issues,
in such scenario organization has to assigned task to other agency which ultimately turns into
capital loss as the work which they can done by their own but because of insufficient knowledge
among workforce enabling firm to pay other agency in order to overcome risk. Therefore, it is
important to have employees at workplace who helps in providing the best aspects in any risk
scenario (Jule, 2020)). There are many instances where firms lacks in analysing the exposure of

risk because of lack of knowledge in it that lead them to avoid certain threat which further
increases and imposed potential challenges for business. Therefore, it is important for the
organization to have safety managers who have enough knowledge and skills in order to fight
against any risk.
MAIN BODY
Literature Review-
Samsung company has faced number of the issues for the mobile phone manufactured
that is Galaxy note 7. As in this mobile phones there was found the issues regarding the batteries
and due to this, the customers has faced many issues that has lead to danger. According to the
Loveridge. And et.al., 2018, there are various risks involved in the telecommunication sector.
The companies involved within this industry are facing many issues and problems as there was
seen a significant impact on this sector due to the COVID 19 pandemic. The top risks which has
been analysed within the telecommunication industry is very large. The telecoms were the most
used things within the pandemic and they were under very high pressure for making the
improvements in the network performance. Many of the users are facing issues while being
unable to connect with the servers and to get access of the fast internet speed. This has increased
the use of the broadband facilities by the customers. Increasing digital society has remained
highly challenging in many of the remote areas as they do not get the proper access and networks
in their mobile phones.
As per the views of Galleso., 2016, the operators within this telecommunication sector
are facing the risk of privacy and security. In the present digital era, the frauds and hacking has
increased much and this is boosting the risk of security and the privacy of the data which has
been stored in the mobile phones. The customers are preferring those mobile phones which are
manufactured in such a way that will keep their data safe and secure so this is increasing the risks
for this industry.
By going through the article of Zhang., 2021, it has been identified that
telecommunication sector is facing the failures for mitigating the disruptions of the supply chain.
The restrictions of the government are increasing which are disrupting the long term deployment
plans regarding the 5G networks. The stakeholders are changing continuously and increasing the
sustainability and for the operators within this industry is becoming very difficult to tackle the

energy inefficiencies with the value chains. There has been found ineffective engagement within
the external ecosystems and this is very important for the companies. The telecom industry is
having lack of leadership and it is very essential for them to focus on these risks.
It has been evaluated that it is not very easy for the companies to apply the risk based safety
programs as there are various traditional barriers associated in it. Author has stated that safety
programs must be separated with the traditional compliance based systems to the risk based
systems. There are many tips which enables the Safety professionals for switching from the
traditional compliance based systems to the risk based systems.
As per Glendon. Clarke. and McKenna., 2016, there are many barriers that are present in
the overall procedure of risk management within an organization. Still, the implementation of
techniques for risk management and methods of risk methods is relevant for the company in
particular. The major barriers that are faced by the companies, and mainly the ones that are big
or huge in the market and have a wide target audience like Samsung, have major barriers. These
barriers are as follows; firstly, treatment of all the potential incidents equally rather than
prioritizing the incidents according to their levels of intensity and the amount of significant
outcomes they will provide. Then, the dependence over the reactive measures like the incident
investigations and the lagging indicators for the purpose of measurement of the performance of
the organizations rather than the activities that are proactive. Next, is the belief that the
declination in the levels of frequency will further decline the severity too, in accordance to the
Heinrich's injury pyramid. Next, is blaming the employees or the workers for the occurred
incidents in particular. Also, the use as well as the dependence of the company over low level
controls in particular is an aspect that can specifically be considered.
According to Smith. and Merritt., 2020, adoption of the risk based safety programs
particularly does not refer or indicate towards the fact that the compliance functions are being
ignored and not given relevance to, rather it means that the compliance functions are identified as
the elements of a mission that is broader for addressing the risks of the company or the
organization in particular. The barriers that are mentioned above have negative impacts mostly
on the working and the performance of an organization or company in particular. All the
incidents if treated equally within an organization then the company will face major issues,
because there are many problems that do not preferably need or require the attention of the senior

management. But if treatment of each problem will be done similarly then the procedures will be
very time- consuming and also this will not be very cost- efficient for the company in particular.
Dandage. And et.al., 2018, states that, all the problems or the risks of a company need to
be categorized into three major divisions in particular, these divisions are, high, low and
moderate. After the evaluation of the risks, every risk should be put into one category. Then the
risks that have high intensity levels and high impact over the company need to prioritized and the
then move further with moderate and low risks. This will allow the company to recognize the
factors of the market that are mostly impacting the company and then work accordingly. Also,
the company will be able to analyse which of the factors the company does not have control over
like the increase in the competition, and which it particularly has control over like the reduction
in demand, and then further work and focus on the issues that are controllable and then work
upon it.
Application of the practice or theory
There are many factors and also trends hat particularly impact or affect the imperative to
change of Samsung in particular. First thing is the mission of the company in particular. The
mission of Samsung is to create superior products as well as services for their customers by
devotion of the required technological as well as human resources in particular. These activities
in particular will obviously contribute in the betterment of the global society in particular.
Another factor is that the goodwill of the company in the market and the industry it particularly
operates is good. The company particularly operates in a market that changes consistently so at
times it becomes difficult for the company after being efficient and proficient too, the incidents
and the risk occurrences are possible. Also, due to the changing market the company, the
problems can be important in one situation or at one particular time and the same issue might not
be so relevant at other. Also, the belief that the decrease in the frequency levels of a risk or a
problem in particular will also reduce the severity of the same will hinder the performance of
company. But at times the company has much more important things and situations to
particularly focus on, due to which the reduction of the focus on the severity also specifically
decreases.
Such things are obviously relevant for the organization. This is very important or
necessary because these things majorly impact the profit or the revenue generation ratios of the
company in particular. Which further, decreases the levels of trust as well as reliability of the

customers in particular. Which will reduce the inclination of the traffic of consumers or
customers towards the company and also reduce the levels of goodwill and recognition in
particular. In this case as the issue is in the working of the batteries in the phone of the company,
only the problem or the issue in a single part of a single product of a company which actually
sells a bunch of different or diverse products in particular, will still impact the goodwill and the
recognition of the company in the markets that it has been working in.
The RMA's enterprise risk management framework basically refers to major aspects that
are to be considered to manage the risks within the organization or the company in particular.
The enterprise risk management framework in regard to the company Samsung is given further.
Business strategy and risk response.
Firstly, the motive of the company or the major business strategy of the company is to
enhance the quality of its working in the future and provide the best possible products and the
best possible services to its customers in particular (Magerakis. and Habib., 2021). The market
that the company is working in, it wants to stay in those markets only and wants to expand more
in different countries and not industries. The company should mainly capture the financially
stable customers and the age group that is also technologically invested and advanced in
particular.
Risk appetite
The intensity of risk the business can bare is good in terms of financial aspects but the
major harm will be caused to the image of the business in the market and the industry in
particular (Bekaert. Engstrom. and Xu., 2022).
Governance, policies and procedures
The corporate governance of the company is to ensure that the management is
responsible through checking and identifying the participation of the business representatives on
the board in particular, by enhancing the efficiency of the board by delegating the authorities
which is as per the article 28–2 and the article 11-2 and lastly, improving the supervision via the
committees that are composed by the majority of the independent directors in particular
(Armour. and et.al., 2017).
Developing the risk management
Key change/
issues
Potential effects
and risks
Assessment of
risk (high,
Additional
controls needed
Responsibility for
action

moderate, low)
Prioritizing of the
incidents.
 Failure in
the
identificati
on the
activities
or the
incidents
that
should be
prioritized
and to be
focused
upon
before any
other
thing.
Can result in
wastage of time
and resources and
also enhance the
intensity of the
major problems.
Moderate To evaluate the
market and also
the risks present
and then
categorize the
risks in
accordance to
their intensity
levels.
The responsibility
is of the research
and the
development
department of the
company because
they are
responsible to
evaluate the
market and the
risks.
Employee
productivity.
 Lack in
training
and the
developm
ent of the
employees
further
High. Identification of
the requirements
or needs of the
employees to
increase the levels
of coherence in
their individual
The Human
resource
department is
responsible for
enhancement of
employee
productivity

leads to
less
understan
ding
regarding
work
which will
reduce the
encourage
ment of
the
employees
(Beloor.
Nanjundes
waraswam
y. and
Swamy.,
2017).
Can result in
major proficiency
loss, and also in
reduction in the
effectiveness
levels.
and
organizational
goals.
levels.
Budgetary issues.  Increase
in the
levels of
the cost of
the
supplies
bought by
Moderate. Better budget
preparation.
Finance
department and
research and
development
department.

the, to
reduce the
amount
the quality
might be
hindered
and
otherwise
the price
might
increase
(Chuguno
v. And
et.al.,
2018).
Can result in the
reduction in the
levels of
customers buying
the products and
the services of the
company.
Increase in the
levels of
competition.
 Reduction
in the
employee
productivi
ty will
further
reduce the
competitiv
e
High. Also, work on
providing better
after sales
services to the
customers and
other unique
services too, that
are different from
Human resource
department and
research and
development
department.

advantage
and other
competitor
s might
attract the
customers.
May result in
decrease in the
revenue
generation of the
company.
other companies.
Better substitutes
in the market.
 Due to the
lack of
good
quality
batteries
in devices
the
goodwill
of the
company
will
reduce
and
customers
will
switch to
other
substitute.
May result in
reduction in
High. Work on the
function that is
not good and also
enhance the
quality of other
functions of the
device which are
better than other
substitutes.
Marketing and
sales department.

employee
encouragement,
goodwill and
profits.
The relationship between key changes and the sequence that is to be adopted for the changes
in particular.
The key changes that are to be made within the organization or the company in particular
are all kind of connected in most ways. Also, most of them are not as highly intense as the others
in particular. It is very necessary to understand which of the changes that will take place within
the organization will impact other changes too and also which of them will particularly impact
the most on the working, the performance, the success and the goodwill of the company in
particular. One of the changes in the company that is to be made is to enhance the productivity of
the employees in the organization, this is mainly because employees or the human resource
within an organization is the major asset of the company. If the employees of the organization
are inclined towards the organization in particular then they will further increase their levels of
productivity as well which will bring more, new and innovative ideas within the business and the
company can improve the quality of the functions that are present in the device and then the
company can also gain competitive advantage over other competitors of the company that are
present in the market. This will also increase the demand of the products of the company and the
revenue levels will also increase. Which will again improve the productivity of the employees
and the cycle will go on. One of the major changes that are to be made within the organization in
particular is preparation of a budget that is more relevant and in accordance to the capital
invested and the return that is done on the particular investment specifically. The budget will also
be increased if the revenues will increase in particular.
The sequence that should be followed by the company for the purpose of interrelating all
the changes and also bring the most out of those changes in particular is stated further. Firstly,
the focus should be on encouraging the employees for the purpose of increasing the productivity
levels in particular. This can be done by improving the leadership and the implementing
employee engaging activities. Then the competitive advantage will be gained which will reduce
the threat of the competitors and the substitutes as well as the employees will also provide

innovative and new ideas in particular. Then the budget regarding the betterment of the activities
should be prepared which should further not be exceeded in particular. This sequence will reduce
the levels of chaos and also bring out the best and the most appropriate and the most suitable as
well as the desired results for the company in particular. It will also not harm other aspects of the
company or the organization in particular.
Conclusion and recommendations
The overall report mainly states that the major issue that the company that has been
selected - “Samsung” in particular is facing. The overall discussion regarding the one main issue
is done in the report which is regarding the batteries of the device manufactured by the company
(Dandage. And et.al., 2018). Further, the report discusses regarding the overall risk barriers that
are present in the company and the industry too, within which the company works. The overall
evaluation of the major risk barriers that are treatment of the potential incidents equally rather
than giving relevance to the incidents as per their intensity levels and also according to the levels
of the importance of outcomes in particular. Next, the dependence on the measure that are
considered to be reactive such as the incident investigations as well as the lagging indicators for
measurement of performance of the companies rather than the proactive activities. Then, is the
belief that decrease in frequency will also decrease severity too, as per the Heinrich's injury
pyramid. Then, is blaming the workers or the employees for the occurrence of the incidents in
particular. Lastly, the use and also the dependence of the organization over the low level controls
is a function that can specifically be considered. Also, the major changes required in the
company related to the employee productivity levels, budget preparation and the issues regarding
the competitive advantage of the company are particularly discussed above.
The major implications of the findings will support and allow the company in attaining
the goals and the objectives in accordance to the mission that is to be achieved by the company
in particular and is set and planned by the company. The findings also show that these risks can
be reduced by planning and performing tasks and activities that are considered to be relevant in a
manner that is better and also by working efficiently in particular. The company mainly has
operational risks that are of high level. This allows the competitors of the company to attract the
customer base and decline the inclination of the traffic towards the company in particular.
For sustaining the position of the company in the market that it is particularly operating
within. The company has to take major steps and conduct or performs certain practices that are

required. The major recommendation is that the company should implement policies for the
betterment of the employees within the company in particular. If the employees of the company
will be encouraged to work for the company, the productivity levels of the company will
obviously improve and this will further lead to more chances for gaining competitive advantage
for the company. The employees that are competent and are proficient as well will bring new and
innovative ideas for the betterment in the battery aspect of the device which is creating problems
within the development and the goodwill of the company in particular. Employees are obviously
one of the major resources of the company and their individual goals should be linked to the
overall organizational goals of the company in particular.

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