BSBRSK501 Diploma of Business: Risk Management Report Analysis

This report provides a detailed analysis of risk management within a business context, covering a wide array of topics. It begins with an overview of different types of risks, including operational, strategic, and external risks, and then delves into the key steps of the risk management process, such as risk identification, analysis, and resolution. The report also explores the components of risk management, various sources of information, and the application of PESTLE analysis. Furthermore, it examines stakeholder identification, risk criteria, and the importance of continual communication. The report provides an understanding of various tools used in risk management, including probability and impact assessment, and also differentiates between qualitative and quantitative risk analysis. Consequence tables, risk treatment strategies, and cost-benefit analysis are also discussed. The report concludes by highlighting the importance of a well-documented risk management plan, including processes, budget, roles, and responsibilities, as well as mechanisms for continual review and the relevance of legislation and risk management standards. The report also includes a case study which analyzes the organization's goals, external factors, critical success factors, stakeholders, and provides a SWOT and PESTLE analysis, and a risk assessment table. Finally, the report provides an action plan and monitoring and review mechanisms.

DIPLOMA OF BUSINESS
Diploma of Business 0

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Table of Contents
Assessment 1:..................................................................................................................................6
1. Examples of risk......................................................................................................................6
Operational risks......................................................................................................................6
Strategic risks...........................................................................................................................6
External risks...........................................................................................................................6
2. Key steps of the risk management process..............................................................................6
Identification of risk................................................................................................................6
Methods of risk analysis..........................................................................................................6
Identify risk triggers................................................................................................................6
Risk resolution ideas................................................................................................................6
Action plan to risk resolution..................................................................................................7
Accountability and responsibility............................................................................................7
3. Components of risk management............................................................................................7
4. Sources of information............................................................................................................7
5. Components of a PESTLE analysis.........................................................................................7
Political factors........................................................................................................................7
Economic.................................................................................................................................7
Social.......................................................................................................................................8
Technological..........................................................................................................................8

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Legal........................................................................................................................................8
Environment............................................................................................................................8
6. Stakeholders and methods.......................................................................................................8
Stakeholders.............................................................................................................................8
Methods to identify internal stakeholders................................................................................8
Methods to identify external stakeholders...............................................................................8
7. Risk criteria..............................................................................................................................9
8. Continual communication is critical........................................................................................9
Build and maintain trust...........................................................................................................9
Appropriate language...............................................................................................................9
Clear and transparent...............................................................................................................9
9. Tools........................................................................................................................................9
Risk probability and impact assessment..................................................................................9
Probability and impact matrix.................................................................................................9
Risk urgency assessment.......................................................................................................10
Expert judgment.....................................................................................................................10
Categorization of risk............................................................................................................10
10. Components.........................................................................................................................10
11. Difference between Qualitative risk analysis and Quantitive risk analysis.........................10
Qualitative risk analysis.........................................................................................................10

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Quantitative risk analysis.......................................................................................................10
12. Consequence table...............................................................................................................11
13. Risk treatment......................................................................................................................11
Avoidance..............................................................................................................................11
Reduction...............................................................................................................................11
Transfer..................................................................................................................................11
Acceptance.............................................................................................................................11
Sharing...................................................................................................................................11
14. Cost-benefit analysis............................................................................................................11
15. Factors..................................................................................................................................11
16. Items documented in a risk management plan.....................................................................12
Process...................................................................................................................................12
Budget....................................................................................................................................12
Roles and responsibilities......................................................................................................12
Reporting structure................................................................................................................12
Risk categories.......................................................................................................................12
17. Importance to ensure continual reviewing of the risk management plan............................12
Meet deadlines and maximizes results..................................................................................12
Evaluates the entire project....................................................................................................12
18. Mechanisms.........................................................................................................................12

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19. Legislation...........................................................................................................................12
Codes of practice and national standards...............................................................................12
20. Risk management standards................................................................................................14
Assessment 2 – Case Study - Part 1...............................................................................................15
Description of the organization.................................................................................................15
Goals..........................................................................................................................................15
Analysis of external factors.......................................................................................................15
Critical Success Factors.............................................................................................................15
Identification and analysis of external factors...........................................................................16
Identification of stakeholders....................................................................................................16
PESTL Analysis.........................................................................................................................16
Political factors......................................................................................................................16
Economic factors...................................................................................................................16
Social factors.........................................................................................................................16
Technological factors.............................................................................................................16
Legal factors..........................................................................................................................16
Economic Factors..................................................................................................................17
SWOT Analysis.........................................................................................................................17
Risk Assessment Table..............................................................................................................17
Agenda, Discussion, Issues........................................................................................................18

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Risk Management Table............................................................................................................18
Actions Plan...............................................................................................................................19
Strategy for implementation of the risk management plan........................................................19
Risks acknowledged for the organization..................................................................................19
Human Resources Risk..........................................................................................................19
Legal/Contractual Risks.........................................................................................................19
Promotion / Public relation related Threats...........................................................................20
Report on risk management action plan....................................................................................20
Action plan process....................................................................................................................21
List of sources of information and supporting documents........................................................21
Monitoring & Reviewing Mechanism...................................................................................21
Recording Methods................................................................................................................22
Review Mechanism...............................................................................................................22
References......................................................................................................................................23

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Assessment 1:
1. Examples of the risk
Operational risks
Accounting errors and data entry errors.
Strategic risks
Project risk and program risk.
External risks
Competitors and pricing pressure.
2. Key steps of the risk management process
Identification of risk
This is the principal step in a script the entire design to identify, accumulate all stakeholders for
completely probable project threats. This is complete by any information of the plan, by many
sections, and design documents (Ponting, 2014).
Methods of risk analysis
Every project of the organization faced with risks. The risk is to identify and analyze by their
impact and probability using the PI matrix. Quantitive and qualitative are methods to analyze the
risk (Kielmas, 2018).
Identify risk triggers
Risk management planning team divided into assign segments and subgroups of the main list of
risk to each subgroup (Gill, 2011).
Risk resolution ideas
The sub-team file preventive activities for threat, identify for the enhancement actions and
identify the opportunities.
Risk is unidentified actions that are fundamentally neutral. These are positive and negative. The
organization should appear at chances to advantage from opportunities to existent them (Holder,
2015).

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Action plan to risk resolution
The manager of a project decides a strategy of an act to fetch risk resolution. The risk with P-I
value preserved with the greatest insistence with impact or least prospect for a monitored real
plan of action. The most serious risk at the start of the scheme saves resources, cost, and time
with the documentation of trigger and the plan of resolution.
Accountability and responsibility
Members of the team, various teams, and chart allocated accountability for booming out the
plans of risk resolution. The manager of the project is responsible for all the actions and plans
related to the project and risks at large level (Paladin, 2012).
3. Components of risk management
Global investment risk and business failure risk.
4. Sources of information
Primary, secondary, and tertiary sources.
5. Components of a PESTLE analysis
PESTLE is a tool or framework used to monitor and analyze the macro-environment dynamics
that have an effect on the performance of an organization (Watson, 2011).
Political factors
This factor determines that the government influences the economy or a certain industry.
Political dynamics comprise trade tariffs, fiscal policy, and tax policies. The government
imposes a new duty and tax to which whole revenue making structures of the organization might
change. Labor law of the organization assesses the attractiveness of a potential market (Brink,
2019).
Economic
These determine the economic performance of the organization that affects and have muffled
long-term effects. A rise in the rate of inflation affects organization services and products. The
power of purchase of a customer affected by the organization models of supply for that economy.

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Social
These features scrutinize the communal environment of the marketplace and gauge the
determination likes population analytics, age distribution, demographics, and trends of culture. In
the holiday season in India, there is a high demand for western dresses.
Technological
Operations of the organization are favorable or unfavorable are pertain by the innovation in
technology. This refers to development and research, automation and the technological
awareness of an organization market possess.
Legal
This factor has both internal and external sides. An environment of business is affected by
certain policies. For example standards of safety, consumer laws, and labor laws, etc.
Environment
This factor includes influences that determined by the surrounding environment. These include
climate, geographical location, and environmental offsets.
6. Stakeholders and methods
Stakeholders
A stakeholder is a party that has noticed in the organization and can be affected or affects the
organization. Stakeholders of the organization are communities, unions, suppliers, owners,
government, employees, directors, and creditors (Stake, 2014).
Methods to identify internal stakeholders
Internal stakeholders are important to perceived success within the organization. It is often
adjudged by the apparent fulfillment of internal stakeholders.
Internal stakeholders identify by a chart of the organization and by the level of the project of the
organization.
By going through the phases of the project and list out the teams and people involved in phase
(Reed, 2015).
Methods to identify external stakeholders
External stakeholders not directly involved in the operations of the organization.

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Financial website of business helps to identify the external stakeholders.
Australia stock exchange also represents the business external stakeholders (Calker, 2017).
7. Risk criteria
Criteria of risk identify the significance of well integrity risk. This is set by combining and
considering consequences. Criteria of risk assigned by the combination of risk and single risk.
8. Continual communication is critical
Communication risk is an integral portion of the risk valuation procedure for an organization.
This includes communication between organizations and agencies. This process is designed for
assessing and managing the risk (Klee, 2012).
Build and maintain trust
Maintaining consistency while communicating is necessary for the business but not harming to
the accuracy. If new information is not consistent, that need to acknowledge the change or
previous mistakes and explain the situation as it stands.
Appropriate language
Considering the audience is the most important part of providing surety about the language and
type of communication. The leads of the organization for desired outcomes and actions must
convey information.
Clear and transparent
Communicating in a direct way means clarity with simple, direct, and understandable way.
Transparency presents assumptions, uncertainties, and methodologies.
9. Tools
Risk probability and impact assessment
Examining each threat will arise and the possible effect on the objective of a plan like
performance, quality, cost, schedule, describing it in heights, through assembly and through
interviewer or documenting the results and meeting with the stakeholders.
Probability and impact matrix
Rating the risk for additional Quantitive examination using an impact matrix, the probability
should be specified by the business in advance.

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Risk urgency assessment
In this analysis, the assessment of risk insistence joint with the risk ranking indomitable from
impact matrix and probability.
Expert judgment
Individual involvement with a similar scheme in the not else reserved past may use decision
through risk or meetings facilitation workshops.
Categorization of risk
To determine the parts of the scheme exposed to the effects of vagueness. This can help to
improve an effective response of risk.
10. Components
Global investment risk
Financial market risk
Business failure risk
Inflation risk
Interest rate risk
11. Difference between Qualitative risk analysis and Quantitive risk analysis
Qualitative risk analysis
In this, a pre-defined rating gauge used to ascertain the threat of the plan. The score of risk based
on the likelihood or the impact on objectives and probability of occurring of the project. This is
ranked on a zero to one gauge. The scale of influence is organizationally defined. This includes
the appropriate categorization either this includes the risks, effect-based or source based (Yazar,
2012).
Quantitative risk analysis
This is an exploration of the maximum priority risks with a Quantitive or numerical rating with
an order to improve a probabilistic analysis.
Quantifies the possible outcomes to achieve specific objectives of the project.
Provides the approach for decision making in uncertainty.

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Creates achievable cost and realistic, scope targets or schedule (Finney, 2013).
12. Consequence table
These levels describe the level of frequency values or make easy for a person to exploit a threat.
It is easier to think in the form of probability value and frequency. This relates to ease misuse or
mistake or to motivate for performing a malicious action.
13. Risk treatment
Avoidance
This helps to avoid the factors of the risk to perform better
Reduction
This helps to take mitigation actions to reduce risk.
Transfer
All the portion of the risk can be transferred to the third party. Types of transmission are
outsourcing and insurance.
Acceptance
This is known as risk retaining. This is hard to appreciate a dynamic life without selecting to take
on the risk.
Sharing
This is the dispersal of the risk to any organization or individuals. This is done by using a variety
of explanations including self-insurance strategies and insurance products.
14. Cost-benefit analysis
This is a process by that an organization analyzes determine, projects, systems, decisions, and
value for intangibles. This is built by identifying the benefits of action with costs associated, and
costs subtracting from benefits (Gordon, 2014).
15. Factors
Possible options for action should be specified.
Possible outcomes should be listed. The list should be mutually exhaustive and exclusive.