Risk Management Plan

This report discusses the importance of risk management and identification for business organizations and strategies to mitigate risks. It focuses on the major risks faced by Corwin Corporation and provides strategies to prioritize and manage them. The report also discusses communication strategies with stakeholders.

Running head: RISK MANAGEMENT PLAN
Risk management plan
Name of the student
Name of the university
Author note

1RISK MANAGEMENT PLAN
Introduction
Risk management and identification is important for the business organizations in
mitigating the probability and impact of emergence of risks. The organizations should have the
proper and suitable mechanism for identification of the risks and assessing them on the basis of
their probability and impacts. In this case, the risk impact and probability matrix is beneficial for
rating and prioritizing the risks (Cardona, 2013). This report will discuss about the major risks
being faced by Corwin international and will use the risk matrix in prioritizing it. On the basis of
the risks identified, responses strategies in mitigating the risks and the communication strategies
to be involved with the involved stakeholders will also be discussed in this report.
Risk
Category Risk Description Risk Cause Impact Likelihoo
d Rating
Finance Overrun of financial
resources
Financial limitation 4-Major 5-Almost
Certain Extreme
Commercial Lack of rightly skilled
employees
lack of properly trained
employees
3-
Moderate 4-Likely High
Safety Lack of R&D expertise lack of prior experienece 4-Major 3-Possible High
Commercial lack of coordination with
the client
no proper channel 3-
Moderate 3-Possible Medium
Identification of the risks
One of the major risks identified for Corwin Corporation is the overrun of the financial
resources. This is due to the reason that in the case study it is stated that Corwin Corporation is
investing their own capital for the standards tests as their cost gone beyond the contracted
budget. Moreover, as the contract was signed based on fixed cost, the client Peter was not
responsible for paying for the added capital. Thus, it caused financial burden for Corwin
Corporation (Hopkin, 2018). The more impact of the financial burden will be the lack of funds
for other business activities of Corwin Corporation. This is due to the reason that there are
number of other activities especially the production activities are done by Corwin Corporation

2RISK MANAGEMENT PLAN
and the added financial cost got added from the allocated annual budget of the from. Thus,
outflow of the fund from the allocated budget will cause financial pressure on the development
of other activities (Bolton, Chen & Wang, 2013).
On the other hand, it is also identified that lack of rightly skilled and expert employees
from the engineering department is another risk for Corwin Corporation. This is due to the
reason that marketing department of Corwin Corporation is only having the skilled employees
who can deal with the customers. This is a major gap for Corwin Corporation. Lack of skilled
and expert employees is causing issues in the project. In the case study, it is identified that west
is selected based on his expertise in the engineering department but not on the basis of dealing
with the customers. Thus, he was not able to manage the undue requirements of the customer.
Thus, the major impact from this identified risk will be the dissatisfaction of the employees along
with the loss for the company (Bromiley et al., 2015). If the customers cannot be managed well,
then they will get dissatisfied and will not be loyal to the company. In the case study, it is
reported that Corwin Corporation also faced the termination of the contract from Peters due to
the dissatisfaction. In the future, Corwin Corporation will face more loss if the customers cannot
be managed well.
Another risk identified is the lack of R&D expertise. In the case study, it is reported that
Corwin Corporation is not having expertise in research and development needed prior to the
production process. Thus, accepting the business deal of initiating research and development
activities is also a major risk for Corwin Corporation (Aven & Zio, 2014). This risk will involve
non-controllable financial loss and safety issues. As Corwin Corporation is not having prior
expertise in this area, the safety aspects of the involved stakeholders might get compromised.

3RISK MANAGEMENT PLAN
Mitigating strategies
One of the major strategies that can be beneficial in managing the identified risks is the
contingency budget. This is due to the fact that creating contingency budget planning will help
Corwin Corporation to have the reserved fund to be used during the emergency situation. Thus,
in case of any projects getting beyond the allocated budget, this reserved budget will come
handy. Another mitigation strategy recommended is the providence of training and development
plan for the staffs from the engineering department. These staffs should also have the skills of
managing the customers (Vovchenko et al., 2017). Thus, if they can be trained and developed,
they will also be able to manage the staffs like the marketing department. On the other hand, it
should be noted that even though taking research and development based jobs is risky for Corwin
Corporation due to lack of expertise, but taking more of it will ensure that they are gaining the
required expertise. Thus, they should develop the infrastructure of their research and
development process and take up more contracts in gaining more expertise.
Treatment
Strategy Treatment Description Treatment Resources Risk
Owner Deadline
Avoid contingency budget building Budgetary reforms Accountant 2 weeks
Avoid training program training elements HR
personnel 4 week
Accept More R&D based jobs more human resource involvements Operations 24 weeks
Accept proper service standards standardized sets of regulations and
provisions
HR
personnel 4 weeks
Stakeholder communication
Information regarding the ongoing risk management activities should be communicated
to the stakeholders by means of general meetings in the presmises. Corwin Corporation is

4RISK MANAGEMENT PLAN
conducting two half yearly meetings each year and the information regarding the risk
management activities along with the different elements should be communicated through these
general meetings. This will help Corwin Corporation to gain the feedback from the stakeholders
regarding the activities (Pasman, Knegtering & Rogers, 2013). In addition, it is also
recommended that the stakeholders can also be communicated through making it compulsory for
the stakeholders involved in the project. Thus, the stakeholders involved in the project should be
signed in the risk management plan and it will ensure that they are getting the information about
any updates.
Conclusion
Thus, it can be concluded that there are number of risks being faced by Corwin
Corporation in terms of their project in research and development. In this report, each of these
major risks are being identified and analyzed. These risks will have adverse impacts on the long
term business operation of Corwin Corporation. In addition, this report has also discussed the
strategies that can be used in mitigating the risks in the long term. These strategies include
building contingency budget, providence of training to the engineering employees and accepting
more research and development based jobs. All these strategies will ensure that the identified
risks are mitigated. A few ways of communicating and informing the stakeholders about the risk
management plan are also discussed. A separate risk management plan is attached with this
report.
Reference
Aven, T., & Zio, E. (2014). Foundational issues in risk assessment and risk management. Risk
Analysis, 34(7), 1164-1172.

5RISK MANAGEMENT PLAN
Bolton, P., Chen, H., & Wang, N. (2013). Market timing, investment, and risk management.
Journal of Financial Economics, 109(1), 40-62.
Bromiley, P., McShane, M., Nair, A., & Rustambekov, E. (2015). Enterprise risk management:
Review, critique, and research directions. Long range planning, 48(4), 265-276.
Cardona, O. D. (2013). The need for rethinking the concepts of vulnerability and risk from a
holistic perspective: a necessary review and criticism for effective risk management. In
Mapping vulnerability (pp. 56-70). Routledge.
Hopkin, P. (2018). Fundamentals of risk management: understanding, evaluating and
implementing effective risk management. Kogan Page Publishers.
Pasman, H. J., Knegtering, B., & Rogers, W. J. (2013). A holistic approach to control process
safety risks: Possible ways forward. Reliability Engineering & System Safety, 117, 21-29.
Vovchenko, N. G., Holina, G. M., Orobinskiy, A. S., & Sichev, R. A. (2017). Ensuring financial
stability of companies on the basis of international experience in construction of risks
maps, internal control and audit. European Research Studies Journal, 20(1), 350-368.