Risk Management and Communication

The assignment details the risk management process in a company, focusing on the internal staff's contribution to identifying risks and the role of external consultants in providing a neutral perspective. The document also emphasizes the significance of communication throughout the risk management process, including initial communications to create awareness around business reasons for change and subsequent communications to share right messages at right times.

Task 1
Ans 1
Risk management standards have been planned with the goal that the individuals who must do risk
management measures have a guide for help them to work. These standards help to give a global
agreement on the best way to manage certain risks, and they offer best practice guidance on the most
proficient method to manage others. Risk management standards help associations to implement
procedures which are attempted and tried, and proven to work.
Ans 2
The 11 principles of AS/NZS ISO 31000: 2009 Risk Management Principles and Guidelines
are:
1. Risk management establishes and sustains value.
2. Risk management is an integral part of all organizational processes.
3. Risk management is part of decision making.
4. Risk management explicitly addresses uncertainty.
5. Risk management is systematic, structured, and timely.
6. Risk management is based on the best available information.
7. Risk management is tailored.
8. Risk management takes human and cultural factors into account.
9. Risk management is transparent and inclusive.
10. Risk management is dynamic, iterative, and responsive to change.
11. Risk management facilitates continual improvement of the organization.
Ans 3
WHS legislation according to risk management is for the business methodically oversee risks
emerging from work place dangers. Coming up next are the means/cycle to oversee risk:
1. identify sensibly predictable dangers - distinguish the conceivable risk that could affect the workers
in the company
2. eliminate risks by keeping standard risk management
3. minimise those risks by recognizing the risk itself and follow the standards
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4. implement risk control quantifies so everybody will be in safe
Ans 4
Work Health and Safety Regulations 2011
a. postures, movements, forces and vibration relating to the hazardous manual task
b. the duration and frequency of the hazardous manual task
c. workplace environmental conditions that may affect the hazardous manual task or the worker
performing it
d. the design of the work area
e. the layout of the workplace
f. the systems of work used
g. the nature, size, weight or number of persons, animals or things involved in carrying out the
hazardous manual task.
Ans 5
The purpose of risk management policies and procedures in the workplace is intended to provide a
framework for the management of risk and also to increase overall awareness of risk throughout the
council and to enable managers and those responsible for risk reporting, to better identify, assess and
control risks within their areas.
The purpose of risk management policies and procedures in the workplace are for better decision
making, minimize the risk, optimise the outcomes, improve the performance, achieve the
organisational goals, time-saving and cost saving, better understanding for staffs about the risk
management in the company.
Ans 6
The three examples of the impact of risks for a workplace if risks are not identified or actioned are:
Poor Housekeeping
Poor housekeeping rehearses oftentimes add to occurrences. In the event that seeing paper, flotsam and
jetsam, mess and spills is acknowledged as would be expected, at that point other more genuine hazards
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may be taken for allowed. Housekeeping isn't simply neatness. It incorporates keeping work regions
perfect and organized, keeping up corridors and floors liberated from slip and excursion hazards, and
eliminating of waste materials (e.g., paper, cardboard) and other fire hazards from work regions.
Chemical Hazard
Hazardous chemicals are substances that can cause antagonistic wellbeing impacts, for example, harming,
breathing issues, skin rashes, hypersensitive responses, unfavourably susceptible sensitisation, malignant
growth, and other medical issues from introduction. For instance: Paint, Medications, Cleansers,
Electrical Hazard
Electric shock is one of the most widely recognized hazards across building destinations as per OSHA.
Distinguishing electrical hazards can help bring issues to light of the dangers, their seriousness, and how
it can hurt laborers.
Ans 7
The step-by-step procedure that companies can use for analysing risks are:
Step 1: Identify hazards, i.e. anything that may cause harm.
Step 2: Decide who may be harmed, and how.
Step 3: Assess the risks and take action.
Step 4: Make a record of the findings.
Step 5: Review the risk assessment.
Ans 8
The three sources of information that a company could use to gather information on potential
risks are:
Brainstorming
Brainstorming is finished with a gathering of individuals who centre around ID of danger for the task.
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Delphi Technique
A group of specialists is counselled namelessly. A rundown of required data is sent to specialists,
reactions are gathered, and results are sent back to them for additional consideration until an agreement is
reached.
Swot Analysis
(Strength, Weakness, Opportunities And Threats) Strengths and weaknesses are recognized for the task
and in this way, hazards are resolved
Ans 9
The three examples of tools or techniques that a company could use to identify risks as part of a risk
assessment process are:
1. SWOT Analysis STRENGTH, WEAKNESS, OPPORTUNITIES AND THREATS), Strengths and
weaknesses are identified for the project and thus, risks are determined.
2.Checklist Analysis: The checklist of risk categories is used to come up with additional risks for the
project.
3.Risk register: It includes in the historical records that will be used for future projects.
Ans 10
The four options for controlling risks are:
1. PPE: Protect the worker with personal protective equipment.
2. Administrative controls: Changing the way that people work.
3. Engineering controls: Isolating people from the hazard.
4. Substitution: Replace the hazard.
Ans 11
The four ways to minimise risk are:
1. Identification of the risks early in the project.
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2. Improve communication about risks.
3. Consider opportunities as well as threats when assessing risks.
4. Prioritizing of risks.
Task 2
Ans 1
Nature Care Products
Risk Briefing Report
Introduction
Nature care is an established organization from 1996 that produces skin care products. The products
that are being delivered by the organization are eco-friendly and sustainable. The organization creates
a wide assortment of common items, for example, cleansing creams, moisturizing creams and facial
scrubs. The organization likewise sells its items through its site where its deals are adequate and is
anticipating improve the deals in future.
The organization is currently monetarily steady however has as of late discovered their rivals selling
similar kind of products in the market. Along these lines, the organization chooses to improve its
deals by in any event 20% in the following three years. In this way, the advertising supervisor is
needed to think of suggestion dependent on his analysis and research.
Scope
 Increase the number of people who make a purchase while visiting the online store by 20%.
 Increase the number of retail outlets selling Nature Care Products by 150.
 To increase product awareness amongst the target market by 20%.
 To increase market share to 15%.
 To expand into at least one international market.
 To identify new products and new markets.
 To attain annual growth of at least 10% over the next three years.
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PESTLE Analysis
Political
The political factors include the rules and regulations of the country in which the company is working.
The bill presented in 2016 progressively reduces the corporate tax rate from 30% to 25% for all
corporate entities. The recent news polls are indicating another win of Liberal Government which
would be encouraging for the nature care future investment of $150,000.
Economical
The economic factors include the exchange rates in the state where the company is working. Australia
has a large economy with a per capita GDP on par compared to other western European countries.
Australia has high natural resources and also encourages foreign investments.
Social
The social factors emphasise the technical trends in the society. The modern society is more into the
skin care eco-friendly products to maintain their skin with a good hygiene. The company nature care
produces products that are highly sustainable and natural. Based on the view and thinking of today’s
generation towards the skin care, nature care products have a higher demand comparatively to other
products in the market. Mostly the women ageing 25-55 years are likely to be the most interested.
Technological
Technology has its own influence in today’s world in all the sectors of life. In a company like nature
care trust and recognition play a major role in the progress and development of the company. The
company is always looking forward to develop its products and rather introduce new products to meet
the requirements of the customer and satisfy them accordingly. With the help of technology, it is quite
easier to develop a good relationship with the customers. Technology provides a basic mean in
between the company and the customers making it easy for them to access all the newer products and
upgraded information of the products. The company’s website is easily accessible by any individual
and the technical team of the company always strives forward to keep it up to date with no errors and
defects.
Environmental
The environmental factors lead to various global environment safety laws that must abide by the
global standards. The world has now taken pledge to make the planet beautiful and pollution free.
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Nature Care can also play its part by supporting such campaigns and following the norms of the
world. It is always best to understand the external as well as the internal factors that affect the
company on the whole. The company has been one of the leading skin care brands in Queensland,
Australia. Therefore, it is always a good strategy to consider these factors while determining the
policies for the company.
Legal
Nature care Company has grown big very fast and also has developed a few competitors in the
process. So, in order to stay in the market and maintain its profits and not lose their customers, it
needs to follow all the legal legislations of the country in which it is established. The people of
today’s generation are very much aware of the legal aspects. As the company is bound by a few rules
and regulations, it’s very important to meet all the requirements and thereby develop their products
satisfying all the legal legislations.
Internal and external stakeholder analysis
Internal: Managers, Employees and internal supervisors.
External: Government organisations, risk consultants, external advisors, risk auditors.
The above internal and external personnel will have responsibilities in the hazard identification
process. They need to be skilled at identifying a risk and determining the exact nature of a problem.
They need to be able to view the situation objectively and have the ability to communicate any advice
they have in regard to handling the risk.
The challenge for them is to agree in the way they like to have information communicated, in an open
manner.
Strengths and weaknesses
Strengths Weaknesses
Eco-friendly products. Poor product variety.
Experience with online marketing. Non-qualified staff for new retail shops.
Experience with natural care and beauty products. Partial understanding about risk policy and
procedures.
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Government support
Politic and procedures align with current standards.
Critical success factors
The main objective of Natural Care Products is to become in the number one retail store company in
Australia, by selling the highest quality and better price natural products, using ecofriendly
manufacture processes, expanding its product range in 10% and having a minimum customer
satisfaction of 95%.
The strategic objectives of Natural Care are to:
 Expand the market in 20%, opening a new retail shop in Melbourne, Sydney and Brisbane.
 Achieve 100% ecofriendly suppliers to guarantee high quality products.
 Sustain a customer satisfaction rate of 95%.
 Expand product range to attract more customers.
 Improve the management processes and training within the organisation.
 Have sufficient store space to accommodate the range of products according with the expected
demand.
Ans 2
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Ans 3
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Ans 5
Risk Management Plan
Definitions
A risk management plan is a document that a project manager prepares to foresee risks, estimate
impacts, and define responses to issues.
Risk
Risk is the possibility of losing something of value. Values can be gained or lost when taking risk
resulting from a given action or inaction, foreseen or unforeseen. Risk can also be defined as the
intentional interaction with uncertainty.
Likelihood:
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Chance of something happening In risk management terminology, the word “likelihood” is used to
refer to the chance of something happening, whether defined, measured or determined objectively or
subjectively, qualitatively or quantitatively, and described using general terms or mathematically.
Consequence:
Outcome of an affecting objectives. An event can lead to a range of consequences. A consequence can
be certain or uncertain and can have positive or negative effects on objectives. Consequences can be
expressed qualitatively or quantitatively. Initial consequences can escalate through knock-on
effective.
Risk Assessment:
Since risk assessment and management is essential in security management, both are tightly related.
Security assessment methodologies contain risk assessment modules as an important part of the first
steps of the methodology. On the other hand, risk assessment methodologies evolved to become
security assessment methodologies. An ISO standard on risk management (Principles and guidelines
on implementation) was published under code ISO 31000 on 13 November 2009.
Risk treatment/control methods
There are many formal methods used to "measure" risk. Often the probability of a negative event is
estimated by using the frequency of past similar events. Probabilities for rare failures may be difficult
to estimate. This makes risk assessment difficult in hazardous industries, for example nuclear energy,
where the frequency of failures is rare, while harmful consequences of failure are severe. Here are the
6 techniques associated with risk control.
1. Avoidance
2. Loss Prevention
3. Loss Reduction
4. Separation
5. Duplication
6. Diversification
Risk management process
In business, risk management is defined as the process of identifying, monitoring and managing
potential risks in order to minimize the negative impact they may have on an organization. Examples
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of potential risks include security breaches, data loss, cyber-attacks, system failures and natural
disasters.
Risk Description Likelihood Consequence Level of Risk Control Methods Risk Priority
Loss of IT data Moderate Major Extreme Accept Must
Loss of Shareholders Vital Major Extreme Control Should
Loss of Stores Unlikely Moderate High Control Could
Loss of Staff Unlikely Moderate Low Avoid Should
Loss of Vital
Records Unlikely Major High Accept Must
Risk action Plan
Risk
Description
Impact of risk Recommen
ded actions
Resource
requiremen
ts
Timeli
nes
Responsibi
lities
Monitoring
processes
Loss of IT
data
Keep a copy of
data and store it
in Web Storage
Duplication Web
Storage
1 Oct
2020
Careful
activities
to store
Everyday
Loss of
Shareholders
Keep a note on
shareholders
preferences
Loss
Prevention
Statistics 8 Oct
2020
Proper
Analysis
of
statistics
Quarterly
Check
Loss of
Stores
Make strong
commitment and
bond with stores
Loss
Reduction
Stores Data 16 Oct
2020 Analysis
Monthly
Analysis
Loss of Staff Recruiting
efficient and
effective staff
Avoidance
Interviews
24 Oct
2020
Careful
Examinati
on
Staff
Developme
nt
Loss of Vital
records
Keep an eye on
Record
maintenance and
procedures
Separation Data
Analysis
30 Oct
2020
Data
protection
Everyday
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Ans 6
Task 3
Ans 1
After the above Implementation Ash will now have to measure the resulting outcome to make ensure
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whether the organisation’s objectives have been achieved or not. To measure the outcome, he should
consider the following points:
Standard Costing: in this method actual costs incurred by the organisation is compared with standard
costs to identify the fluctuations to be taken care of.
Cost of Capital: in this method ash will ensure that rate of net profit over the total capital should not
be below cost of capital.
Inventory Management: In this method Ash will ensure that the costs of carrying inventory and
ordering costs should be reduced to minimum by ordering the inventory as per EOQ model. Further
Ash must satisfy himself with the Internal Controls of the organisation such like CCTV camera,
Antivirus, etc so as to reduce the risks of any Fraud by employees.
Evaluation
Risk evaluation refers to the classification and categorisation of the risk. This evaluation is done on
the basis of chances of a risk to be occurred in the organisation. At the time of evaluation, the assistant
manager (Ash) should consider three important things:
1.Probability of loss which may occur due to a particular risk.
2.Impact of losses on the company.
3.Ability of the company to predict such losses before that loss arises.
4.Ash should evaluate the risks after considering the above three points and prioritize them and also
identify which risks are acceptable for the company and what are the risks which cannot be faced by
the organisation.
After the above Implementation Ash will now have to measure the resulting outcome to make ensure
whether the organisation’s objectives have been achieved or not. To measure the outcome, he should
consider the following points:
Standard Costing - in this method actual costs incurred by the organisation is compared with standard
costs to identify the fluctuations to be taken care of.
Cost of Capital - in this method ash will ensure that rate of net profit over the total capital should not
be below cost of capital.
Inventory Management - In this method Ash will ensure that the costs of carrying inventory and
ordering costs should be reduced to minimum by ordering the inventory as per EOQ model. Further
Ash must satisfy himself with the Internal Controls of the organisation such like CCTV camera,
Antivirus, etc so as to reduce the risks of any Fraud by employees.
Evaluation
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Risk evaluation refers to the classification and categorisation of the risk. This evaluation is done on
the basis of chances of a risk to be occurred in the organisation. At the time of evaluation, the assistant
manager (Ash) should consider three important things:
1.Probability of loss which may occur due to a particular risk.
2.Impact of losses on the company.
3.Ability of the company to [predict such losses before that loss arises.
4.Ash should evaluate the risks after considering the above three points and prioritize them and also
identify which risks are acceptable for the company and what are the risks which cannot be faced by
the organisation.
Ans 2
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Ans 3
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Ans 4
Since implementation of risk controls have been implemented for more effective resource control, the
following sustainability initiatives have been implemented:
 Energy audit and all recommendations implemented including signage about energy use (e.g.
switch off lights at night, turn down brightness, turn off taps)
 Recycling policy introduced, and three more recycling bins introduced.
 Green purchasing policy developed (on staff intranet, email sent to staff to advise).
 Green transport policy developed and implemented (on staff intranet, email sent to staff to
advise).
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Prior to the implementation of the above, the following targets were set:
 Reduce electricity consumption by 20% within three months.
 Promote awareness of sustainability initiatives amongst all staff members
The results of the energy audit are as follows:
Prior to energy audit:
 Annual energy bill: $2,415 a year
 Annual greenhouse emissions: 18 tonnes a year
Three months later:
 Annual energy bill: $1,800 a year
 Annual greenhouse emissions: 10.2 tonnes a year
Six months later:
 Annual energy bill: $2,215 a year
 Annual greenhouse emissions: 14 tonnes a year
Note: Four new staff members employed may account for increase. Energy targets were not adjusted
to account for the new staff.
Ans 5
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Task 4
Ans 1
A.
Identify risk is a complex process because it demands a complete review of the organisational
processes, procedures and requirement, understanding all those factors in a particular political, social,
legal, technological and policy context.
In-house strategies to assist in the identification of risk are really important, inviting the internal staff
to share comments or concerns about a specific situation is a highly effective resource because they
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know the organisation in detail and their accurate comments make the identification risk process
relatively simple and straightforward.
The level of confidence in the risk identification process is high because it has been the internal staff
who has provided details and comments that were used as a direct input in the risk report. Most of the
people who participated in the process knew the risk policy within the organisation and how the
Business works. The collected information was responsibility of an external consultant, who provided
one last risk analysis from a neutral perspective.
Was it easy or difficult to identify risks?
It was difficult at start but after conducting surveys and research to manage risks at the outset of the
project, and continue to do so throughout the performances. At each point during the project, I have
come to identify risks by recognizing project’s risk factors, using my project phases as well as overall
project plan helped me to identify risk factors.
Was staff input (at the meeting) helpful?
I do believe that staff input was very helpful and mandatory for sustaining organizational
transformation. Employees is one of the primal sources for a company to generate new ideas,
highlight and resolve existing problems, and find out loads of new opportunities to reach excellence in
quality of their service. In fact, nobody knows the situation with a process better, than a person who
immediately works at this process daily, so it is desirable for a company to interrogate their workers
on what they think about managerial methods, utilized technology, current business strategy, and
other attitudes, these efforts may result into tons of discoveries and fresh ideas.
How confident are you that all the risks have been identified?
Identifying, evaluating and understanding risks are a very important aspect of business management.
Businesses can also suffer dreadful consequences if risks are not appropriately managed. The most
widely understood risks according to me are occupational health and safety risks. Most people
generally associate the word risk with injury, health risks and death, but there are many other types of
risk faced by any business other than those aspects. So I am fully confident that all the risks
associated with any business organizations can be identify with the policy, political, environment,
social and legal respectively.
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B.
The process indicated in the Nature Care Products current risk management policy and procedures
was partially sufficient because they used a PESTLE analysis to identify the key factors that impact
on the environment in which Nature Care Products operates and then as an input in the risk report,
they included the internal staff comments regarding the new managerial position issues, which is a
high-effective risk identification resource. The only issue was the delay putting in place the
performance management system, making hard to follow up the performance of the employees filling
the new positions.
C.
The principles of risk management in the Nature Care Products risk management policy and
procedure were consistent with AS/NZS ISO31000:2009 Risk Management Principles and Guidance
because they engaged internal staff throughout the risk management process, showing that
communication was a key to identifying, analysing and monitoring risk.
Also, the company recognised and included the contribution from new staff with a deep understanding
of the policy and procedures policy of the company, helping to have a complete identification and
measure risk process.
D.
I would recommend having an external consultant to assist in the identification of risk process. They
can help to identify risk at a global level and not only in a specific area, in this case the new opening
stores issue. Also, the consultant will provide a neutral perspective that can be used to manage
discussion and debate about the risks within the organisation, without any bias or favour from internal
staff.
Secondly the Communication and Communication Planning, many managers assume that if they
communicate clearly with their employees, their job is done. However, there are many reasons why
employees may not hear or understand what their managers are saying the first time around. Initial
communications are typically designed to create awareness around the business reasons for change
and the risk of not changing. Likewise, at each step in the process, communications should be
designed to share the right messages at the right time.
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Ans 2
Ans 3
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