Managing Operations - Risk Management Framework, PEST and SWOT Analysis

This document discusses the risk management framework for Macville, critical success factors, PEST and SWOT analysis, identification of risks, occurrence of risks, consequence of risk occurring, risk matrix, suitable recommendation of risks, action plan for managing the risks, risk management plan, and references.

Running head: MANAGING OPERATIONS
Managing Operations
Name of the Student:
Name of the University:
Author’s Note:

1
MANAGING OPERATIONS
Table of Contents
Assessment 1...................................................................................................................................2
Risk Management Framework.....................................................................................................2
Scope of Risk Management in Macville......................................................................................2
Critical Success Factors...............................................................................................................2
Table of Stakeholder Template....................................................................................................2
PEST and SWOT Analysis..........................................................................................................3
Identification of Risks..................................................................................................................4
Assessment 2...................................................................................................................................5
Occurrence of Risks.....................................................................................................................5
Consequence of Risk Occurring..................................................................................................6
Risk Matrix..................................................................................................................................6
Suitable Recommendation of Risks.............................................................................................7
Action Plan for Managing the Risks............................................................................................8
Assessment 3...................................................................................................................................9
Risk Management Plan................................................................................................................9
Reference.......................................................................................................................................10

2
MANAGING OPERATIONS
Assessment 1
Risk Management Framework
The risk management system in a business is considered to be an important consideration
which affects the business. The risk management process which is followed by the business of
Macville should be according risk framework which is introduced in AS/NZS ISO 31000:2009.
The standard effectively outlines the 11 principles of risk management and the same is useful in
maintaining an appropriate risk management framework for different businesses.
Scope of Risk Management in Macville
The business of Macville is planning to invest in a new project which is expanding the
operations of the business in a new setting so that the business is able to generate more revenues
in the long run. The scope of risk management covers every aspect from the employee health and
welfare risks, financial risks and risks which are strictly related to the operational process of the
business (Sadgrove 2016).
Critical Success Factors
The critical success factor which can be identified for the business in terms of risk
management would be to effectively reduce or counter the risks which are likely to arise if
changes are not made in the internal control system of the business. In terms of welfare and
security of the employees, the critical success factor would be an appropriate internal control
system where the safety and security of the employees are the first priority.
Table of Stakeholder Template
Stakeholder Internal/ External Role in Process Stake in Process
Employees Internal Engaged in Wages, salaries,

3
MANAGING OPERATIONS
Operational Process
of the business.
safety and security
Owners Internal Decision making
process of the
business
Profits, Revenue and
Growth of Business
Banks External Provides financial
assistances in the
form of loans
Interest on Loan and
Principle amount
Recovery.
Customers External Purchases products
from the business
Quality of products,
Safety in use and
appropriate price
charged for the
product.
PEST and SWOT Analysis
PEST analysis forms a part of external market analysis and the same is conducted for
Macville company and the same explained in details below:
 Political Factors: The new venture which the management of the company plans to
undertake would require some legal work for transferring the property to the new owner,
registration and undertake quality tests. The political factor covers the regulations and
interference of local bodies in the set up of the new venture.
 Economical Factors: These factors include financial factors which can have an impact
on the operations of the business such as hike in interest rate, inflation or increase in cost

4
MANAGING OPERATIONS
of raw materials which would affect the overall costs of the business and negatively
affect the profits of the business (Gupta 2013).
 Social Factors: These factors include the taste and preference of the local people and
how they react to the new product which is being offered. The business of Macville is
opening a new venture in Toowoomba where the people need to like the product which is
being offered by the business.
 Technological Factors: These factors include the development in the technology in the
business and how the same has affected the operational process of the business.
SWOT analysis is conducted to determine the strength, weaknesses, opportunity and threats
which can affect the business. The main strength of the business which can be identified is that
the business is already established which means that the people are aware of the brand which can
help the business to make more revenues (Gürel and Tat 2017). The weakness however which
can be identified is the distance which it has from head office in Brisbane which makes the
decision-making process a bit more difficult. The opportunity which can be identified is that the
market is new and the business can further expand if it is successful in the area. The major threat
which is identified is the level of competition from the existing players and also the availability
of raw materials.
Identification of Risks
Some of the major risks which have been identified are listed below in details:
 The main operations of Macville stores are in Brisbane and the new shop location is
2hours drive away which makes it difficult to have proper contact with the head store in
terms of delivery services for raw materials bakery products.

5
MANAGING OPERATIONS
 The previous owner of the shop Mr Hurley has not maintained any written instruction or
documents for handling the operations of the business and therefore, there might be
misdirection and wastage if the issue is not settled.
 The previous owner did not maintain proper cash records or even maintained register
which suggest that there might be a risk of absconding or theft. Plus, the person who is
responsible for maintain cash register is also given the duty of depositing the same in
banks which makes the situation much risker (Dumas et al. 2013).
 There are no provisions for any injuries which might take place in a workplace and
therefore human welfare is ignored.
Assessment 2
Occurrence of Risks
The risks which are identified by the business in relation to the new venture is mainly
related to the improper internal control system which is set up in the business. The management
of Macville can change the policies for managing the human welfare risks. In addition to this,
there is another risk which is associated with theft as proper cash records are not maintained by
the business which makes the business vulnerable to attempts of fraud and thefts. The business
would be affected in a sever manner if the raw material which are supplied from Brisbane such
as pastries are not fresh which is a major risk for the business. All the risks which are identified
by the business can be controlled by incorporating proper internal control system in the business
and ensuring that all the employee is doing their parts in an efficient manner.

6
MANAGING OPERATIONS
Consequence of Risk Occurring
In case the risk which are identified by the business takes place then the business would
be affected both in terms of financial situation and even will lose reputation. The banking risks is
a major risk which would affect the cash savings of the business and affect the liquidity position
of the business if the risk takes place. On the other hand, if injuries take place to the employee it
will only hamper the operational process of the business and affect the revenues which is
generated by the business (Kerzner 2017). The delay of 2 hours would affect the communication
line of the new store with the management of Macville. Plus, the delivery of pastries would not
be possible as the same would affect the quality of the product thereby hampering the name of
the business. if proper risk management strategies are applied by the business, then risks can be
managed in an appropriate manner by the business (Olson and Wu 2015).
Risk Matrix
Risks Negligible Minor Moderate Significant Severe
Loss of
Brand
Recognition
risk
Very Likely Low Med Medium Medi hi High High
Manager
Travel
Risks
Likely Low Low Med Medium Medi hi High
Banking
risks
Possible Low Low Med Medium Medi hi Medi hi
By law Unlikely Low Low Med Low Med Medium Medi hi

7
MANAGING OPERATIONS
compliance
risks
Very
Unlikely
Low Low Low Med Medium Medium
The risk matrix represents the risks which are faced by the business and how the risks
which are faced by the business can becomes high risk event depending on the occurrence of the
risk.
Suitable Recommendation of Risks
Banking risks
 Appropriate diversification of duties of employees handling register and employee
depositing the money.
 Proper maintenance of Cash Register and Records.
By law Compliance Risk
 The management can adhere to every legal regulations by taking a help of a solicitor or
lawyer.
 The business can also incorporate proper internal control which adhere to all rules and
regulations.
Action Plan for Managing the Risks
Risk Assess
Risk Score
Controls Monitoring Action
Priority
Timeliness Responsible
Banking High Operations Manager 4 1 month Manager

8
MANAGING OPERATIONS
risks
Manager
Travel
Risks
Moderate Operations Supervisors 2 1 Month Supervisors
By law
compliance
risks
Low Manager Manager 1 1 week Top
Management
Assessment 3

9
MANAGING OPERATIONS
Risk Management Plan
Plan: The management of Macville Company plans to set an appropriate internal control system
and appointing supervisors to ensure that the internal control system is properly implemented
and all employees are adhering to the same. The management also plans to set a routine check on
the risks which would be included in the risk management plan so that the any risks are managed
and mitigated in time.
Implementation: The management of the company would be implementing the plan and would
appoint supervisors and managers to ensure that the risk management strategies are properly
followed in the business (Engemann and Henderson 2014). In addition to this, fines and penalty
program would be introduced for any discrepancies so that all employee follow the rules which
are established.
Outcomes: Once the plans are successfully implemented then the overall risks of the business
would be reduced significantly and the management would be able to better direct the operations
and thereby also generate more revenue from operations (Hopkin 2018). In addition to this, the
reputation of the business would also remain intact in such a situation.
Evaluation: The business would be evaluating the plans which are established on a regular basis
and also bring about improvement in the same. The business would also be bringing about
regular and routine checks in the operations so that the risk management plan of the business is
proper.
Reference

10
MANAGING OPERATIONS
Dumas, M., La Rosa, M., Mendling, J. and Reijers, H.A., 2013. Fundamentals of business
process management (Vol. 1, p. 2). Heidelberg: Springer.
Engemann, K.J. and Henderson, D.M., 2014. Business continuity and risk management:
essentials of organizational resilience. Rothstein Publishing.
Gupta, A., 2013. Environment & PEST analysis: an approach to the external business
environment. International Journal of Modern Social Sciences, 2(1), pp.34-43.
Gürel, E. and Tat, M., 2017. SWOT analysis: A theoretical review. Journal of International
Social Research, 10(51).
Hopkin, P., 2018. Fundamentals of risk management: understanding, evaluating and
implementing effective risk management. Kogan Page Publishers.
Kerzner, H., 2017. Project management: a systems approach to planning, scheduling, and
controlling. John Wiley & Sons.
Olson, D.L. and Wu, D.D., 2015. Enterprise risk management(Vol. 3). World Scientific
Publishing Company.
Sadgrove, K., 2016. The complete guide to business risk management. Routledge.