Identify Risk and Plan Risk Management
Submission details - Task 1 (Due : week 4/5)
Candidate’s name Phone no.
Assessor’s name Phone no.
Assessment site
Assessment date/s Time/s
The assessment task is due on the date specified by your assessor. Any variations to this arrangement must be approved in writing by your assessor.
Submit this document with any required evidence attached. See specifications below for details.
Performance objective
This assessment task requires candidates to demonstrate the skills and knowledge necessary to identifying risk and planning risk treatment in the context of a simulated business.
Assessment description
To complete this assessment task, you will need to review a simulated business and associated documentation, identify and document risks, analyse and evaluate risks to determine level of risk for the organisation, and plan to treat risk. You will need to perform these activities in accordance with organisational requirements and the international and Australian standard for risk management, AS/NZS ISO 31000:2009.
Procedure
1. Review the simulated business information for MacVille in the Appendices of your Student Workbook.
2. Review the scenario information contained in the Appendices of this assessment task.
3. Identify the internal and external context for risk management with respect to the MacVille scenario.
4. Identify minimum four risks for MacVille (using tools such as SWOT analysis, checklists, research notes, notes of meetings with stakeholders, etc.)
5. Analyse each identified risk to identify likelihood/probability and consequence of each risk.
6. Determine the level of risk for each risk.
7. Propose possible control measurement s for each risk identified above.
8. Determine what resources are required AND who are the responsible persons for each control measurement. (Resources may include financial resources, human resources, equipment or any other resources you think is necessary to implement your proposed control measurements.)
9. Identify who you can consult (from internal and external parties) to assist your analysis and evaluation of risk AND prepare minimum of 10 questions for your consultation.
10. Submit a detailed report which include the following :
a) Answers for items 3 – 9 above
b) Completed risk template (refer to appendix 2)
c) Completed risk treatment action plan template (refer to appendix 3)
Specifications
You must:
a. Submit a detailed report for items 3 – 9 above.
b. Complete and attach in your report the risk register template (appendix 2)
c. Complete and attached in your report the risk treatment action plan template (appendix 3)
Instructions / Reminders
1. Submit the completed assessment on the specific date, time and location as advised by your assessor.
2. This is an individual (or group) assessment task.
3. You are required to provide answer for ALL sections or questions in this assessment task.
4. All assessment answer must be typed using Microsoft Word (font size :12, font : Arial or Times New Roman) and presented in the appropriate format approved and instructed by trainer.
5. You are NOT allowed to copy straight from any internet-based or written materials available.
6. You are strongly encouraged to use your own words to attempt this assessment.
7. You are required to provide proper and appropriate referencing (if applicable).
8. You are NOT allowed to copy or attempt to copy the work of another student or permit another student to copy or attempt to copy your work.
9. Severe penalties shall apply for copying, plagiarism and any improper use of materials or ignoring instructions given by trainer. Penalties may include failure of the unit and exclusion from the college.
10. It is your responsibility to attend to your classes and seek assistance from trainer if needed.
Appendices
Appendix 1: Scenario: MacVille
MacVille is an Australian coffee supply business. The company imports coffee and supplies cafes and restaurants with top quality coffee, which is produced and distributed in line with the highest social and environmental standards. Within five years, MacVille intends to have established itself as the number one coffee supplier for fine coffee shops and restaurants in Australia. To achieve the company vision, MacVille’s strategic directions include:
? engaging clients with excellent service to increase sales volume
? reducing expenditure and achieving financial control over expenses
? establishing MacVille as employer of choice through supporting innovative thinking, performance management and leadership skills through training, and exemplary health and safety performance
? monitoring supplier quality and triple bottom-line impact.
These strategic directions are reflected in sales and operational targets at every level of the company and are also reflected in individual performance measures. The organisation must effectively identify and manage risk to strategic goals.
MacVille strategic assets
In general terms, MacVille possesses the following strategic assets which may be considered at risk in any venture, project or aspect of day-to-day operations:
Asset Description
Workforce The MacVille workforce is loyal, expert and motivated. The workforce includes:
? sales teams and managers
? roasters and managers of production and packaging team
? distribution team and managers.
MacVille’s reputation as employer of choice is a key strategic asset. MacVille trains its workforce and management team and commits to staff development and advancement. MacVille pays extremely competitive wages and commits to staff wellbeing through wellness and health and safety management programs. MacVille’s commitment to staff extends to involving staff and seeking feedback on organisational strategic directions and activities, particularly activities directly or potentially affecting staff.
Technology MacVille possesses expert, proprietary roasting equipment and techniques. Techniques are most important and are a closely guarded secret. Using MacVille in-house equipment and techniques allows MacVille to tightly ensure production quality and supplies of product for sale.
Supplier relationships MacVille maintains a tightly knit network of suppliers to ensure supply and advance notice of potential supply issues. Suppliers are loyal to MacVille. MacVille encourages such loyalty by paying fair prices for raw beans and making regular purchases.
Reputation The MacVille business model is underpinned by its commitment to triple bottom line reporting and responsibility: social, economic, environmental responsibility. A key to MacVille’s success with customers has been its commitment to Fair Trade practices.
Identifying particular risks to individual projects or ventures will require research and information gathering on the internal and external context of risk concerning MacVille. Such information gathering may include research into local, domestic and international political, environmental, social and technological conditions, standards, codes of conduct. It will necessitate direct or indirect consultation with internal and external risk stakeholders.
Note that, in analysing risk consequence, MacVille adheres to the following guidelines:
? Insignificant: Less than 5% of revenue
? Minor: 5–10% of revenue
? Moderate: 10–20% of revenue
? Major: 20–40% of revenue
? Catastrophic: above 40% of revenue.
A new venture
MacVille has established a relationship with a small village in the highlands of Papua New Guinea (PNG) that grows coffee beans. MacVille is committed to providing equipment and high-level skilled training to the village so that the local villagers can harvest and roast the beans in-country, rather than exporting the green beans as they currently do. MacVille will develop the village’s capacity in exchange for cheaper roasted beans. The costs of development are budgeted to be less than or to equal to the savings gained. The village will incorporate, with every villager a shareholder in the new venture. The village will eventually become a completely independent supplier.
It is anticipated that PNG could potentially supply up to 20% of MacVille’s roast bean supplies.
This endeavour is a major marketing coup for MacVille, as they can strongly market the Fairtrade certification aspects of this, due to the large investment they are making into the village and the skilled trade ability they are giving to the villagers.
It will have additional benefits to MacVille, which include saving considerable amounts of money in both energy and water use, not to mention domestic labour costs and cost of sales.
The venture is not expected to have any effect on domestic production, jobs, advancement, etc., due to increased efficiencies, expansion into new markets, and increased sales made possible by the venture.
Stakeholders and project team members:
Name Position Duties/importance to operations/reason for stakeholder interest
John Wu Operations Manager ? Chair of FARM Committee and project owner: full decision-making powers for project
? overall responsibility for ensuring supply, production, supplier relationships
? monitoring supplies
? monitoring production expenses.
You Communications and Training Officer
Project Leader ? responsibility for overseeing, planning, implementation and risk management
? particular responsibilities for implementation include communications and training for project team members, Board of Directors, FARM Committee and Australian staff and managers
? you will be reporting to the MacVille board of directors and the Finance and Risk Management (FARM) Committee.
Oliver Hughes Australian Human Resources and Training Manager ? monitoring production to achieve production targets
? maintaining and overseeing staff performance and morale.
Yosef Malouf PNG Fairtrade Consultant (contracted to Macville) ? ensuring and monitoring safety standards, and the social, economic and environmental impacts of MacVille operations on PNG
? does not speak local dialect.
Geoffrey Blanche PNG Quality and Production Officer
(Macville employee) ? ensuring and monitoring MacVille standards of quality and rate of production to meet MacVille requirements
? point of contact between MacVille and PNG supplier
? does not speak local dialect.
Connie Black Sales and Marketing Manager ? responsibility for monitoring and meeting sales targets, understanding customer and client needs and concerns.
Harold Jones
Consultant in PNG
(contracted to Macville on monthly basis) ? speaks both pidgin and the local village dialect, so he can liaise with clan chief Dikana
? high-level contacts and influence within PNG Government.
Your role and task
You have recently been assigned to work in a project team charged with the implementation of the new business endeavour for MacVille. Your duties within the project team include:
? risk identification
? analysis
? evaluation
? implementing and monitoring risk treatment, particularly in own areas of specific responsibility: communications, training, demonstrating procedures for affected managers and staff.
As the project leader, you will need to identify possible risks, particularly risks with strategic impact for MacVille. Some research, for example, internet research of PNG conditions or legislative requirements, may be necessary to identify risk and establish context. In accordance with the relevant risk management standard, you will need to analyse and evaluate risks, ensuring you consult with stakeholders to assist you with this important task.
In accordance with MacVille requirements, you will need to follow MacVille risk management policy and framework and reporting requirements. MacVille requires the completion of a risk register for each venture or project and a risk treatment action plan.
It is now the beginning of the first quarter of the financial year. MacVille expects risk management activities to have begun (or be ongoing) simultaneously with implementation of production by end of second quarter.
Appendix 2: MacVille Risk Register template
Risk Risk consequence Risk likelihood Risk level
(L, M, H, E) Control measurements & recommendations
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Appendix 3: MacVille Risk Treatment Action Plan template
Control measurements & recommendations Resources required (eg. Financial, human power, facilities, material, fixed assets, etc.) Responsible person / department Timelines
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