Bsbrsk501 manage risk assessment task 1 answers

Assessment Task 2 BSBRSK501 Manage risk

Analyse and treat risk
Submission details
Candidate’s name

Sami Ullah

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
For this task you are to analyse the risks you identified in the simulated business scenario to assess the likelihood and consequence of risks, evaluate and prioritise risks, and determine options for treatment. You are also required to develop a risk management action plan for the treatment of risks and communicate it to relevant stakeholders.

Assessment description
For the MacVille Pty Ltd simulated business scenario provided, you are required to assume the role of Brisbane store Assistant Manager, Ash, who has just been promoted to be Manager of a new store. Ash has been tasked with conducting a risk management analysis of this new venture.

There are three stages to this project: (1) review, (2) analyse and plan, and (3) monitor. This project is divided into three assessment tasks as follows:

Assessment Task 1

Risk review report, email to stakeholders and meeting with CEO

Assessment Task 2

Risk analysis report, action plan and risk treatment

Assessment Task 3

Monitoring report

For this task, you are to use the information you gathered in Assessment Task 1, along with the simulated business information provided, to examine the likelihood and consequence of identified risks, prioritise the risks and determine options for treatment of each risk. Using this information you are required to develop a risk management action plan for implementing risk treatment, document the plan as required, and communicate the risk management plan to relevant parties.

Procedure
Part A
1. Review the MacVille simulated business scenario information and documentation provided in the Appendices of this task and in Assessment Task 1.

2. Develop a report for the CEO (your assessor) that includes the following:

a. For each risk (i.e. the four identified in the scenario for this task), assess the likelihood of the risk occurring.

b. For each risk, assess the consequence of the risk occurring.

c. Develop a risk matrix to assist in prioritising the treatment of the identified risks, including numerical values (e.g. risk matrix in the Student Workbook).

d. Once you have prioritised the risks, for each, outline at least two suitable options for treatment.

e. Include an explanation of the process you used to identify risks and assess likelihood, consequence and priority. Also include an explanation of why the options you have suggested for treating the risks are:

i. likely to be effective

ii. feasible for the organisation.

Note: Ensure your report is written in a style appropriate to your stakeholder audience, for example, using appropriate language and including appropriate illustrative material (such as checklists, diagrams or flow charts) and attachments to support your findings and process.

3. Develop an action plan (you may use the Risk Management Action Plan template provided in Appendix 3 of this task) for implementing risk treatment and attach it to your report.

4. Communicate your analysis to the Board of Directors by submitting your risk analysis report, along with your risk management plan, to the CEO (your assessor) for internal distribution.

Part B
1. Implement your risk management treatment of one key risk, such as decreased brand recognition, in accordance with the requirements provided to you by the CEO (your assessor). You will need to discuss and agree with your assessor how to provide evidence of your implementation.

2. Submit the required documents for assessment as per the specifications below. Be sure to keep a copy for your records.

Specifications
You must:

· submit a risk analysis report, including a risk matrix

· submit a completed risk management action plan

· implement one risk treatment and submit evidence as agreed with your assessor.

Your assessor will be looking for evidence of:

· reading skills to gather, review, interpret and analyse text-based business information from a range of sources in order to evaluate risk

· written skills to organise and deliver information to effectively communicate risk management analysis and plan to a range of stakeholders

· numeracy skills to interpret mathematical data when reviewing and analysing scenario business information and evaluating risks and treatment options

· ability to work independently to evaluate risks and make decisions about treatment options

· ability to interact with others using appropriate conventions when communicating to, and consulting with, stakeholders

· ability to sequence and schedule activities and manage communication

· ability to analyse relevant information to identify and evaluate treatment options

· ability to use familiar digital technology to access information, document findings and communicate them to stakeholders.

Adjustment for distance-based learners
· No variation of the task is required.

· A follow-up interview may be required (at the discretion of the assessor).

· Documentation can be submitted electronically or posted in the mail.

Appendix 1: Scenario – MacVille Pty Ltd simulated business
Background
The MacVille Board has reviewed the previous report you developed, and has requested further information for four of the identified risks, including options for reducing the risk levels. These risks are as follows:

· Banking risk – theft of cash left on premises.

· Manager’s travel risk – physical injury.

· By-law compliance risk – reputation/brand loss and fines

· Loss of brand recognition risk – brand non-compliance of staff not wearing the MacVille uniform, or altering MacVille processes and service expectations.

Timelines to consider are based on risk priority levels and include the following:

· Pre-settlement – date of legal transfer of the business.

· Opening week – first week of company operations.

· Within three months – after the opening week.

· Within six months – after the opening week.

Responsibilities for actions include the following.

· Financial, insurance and banking issues – Financial Controller.

· Legal issues – Goldsmith Partners.

· Expenditure >$5,000 – MacVille Board of Directors.

· New policy – CEO with MacVille Board of Directors.

· On-site management, training – Store Manager.

· Changes to MacVille Café Queensland operations – CEO.

· External audits – CEO with MacVille Board of Directors.

Develop a report for the Board of Directors that examines these risks and describes ways that each can be treated, and forward a copy of your report to the CEO to table at the next Board meeting.

Appendix 2: Revised notes from previous meetings
Site visit – New Toowoomba store (the existing Hurley’s Café)
Meeting with James Mansfield
You revise your notes from the meeting with James Mansfield and identify the following points.

· In the context of MacVille’s investment here, $4,000 would be considered to be of minor consequence if it were burgled from the closed premises overnight.

· One or two of the staff at Hurley’s pride themselves on being on-trend and well-dressed; they are going to struggle with being required to wear a MacVille uniform. It will be difficult to make them comply with the uniform requirement. The rest of the staff are generally very responsive to employment requirements. The consequence of initial non-compliance would be minor.

Meeting with Ron Langford
You revise your notes from the meeting with Ron Langford and identify the following points.

· He also said that the Toowoomba Council water patrols meant that it is likely that stores not complying with the by-law would be discovered.

Senior management team meeting
You go back over your notes compiled with the senior management team and note the following.

· Further feedback from Paula included that the water compliance risk was one where significant time and resources would be required and the Board would view it having moderate consequences for MacVille’s cafés in Queensland. She also indicated that while the Board views the risk of a serious accident unlikely, any potential risk that could result in the death of an employee would have a catastrophic consequence.

Brainstorming ideas
Looking at the hierarchy of control, the senior management team were able to give you some good brainstorming ideas to pursue. These include the following.

· Installing native plants to cut down water use.

· Making it a company policy to bank every day and eliminate the need to carry overnight.

· Install a teleconferencing system.

· Install a water tank and reduce dependence on council water.

· Change banks to the nearer one to avoid the long walk.

· Install dual-flush toilets.

· Insure overnight cash holdings.

· Finish management meetings at 3.00 pm.

· Introduce new processes on water use and conservation.

· Change assistant manager training times to the morning.

· Write new policy and procedures for water use in Toowoomba.

· Install a water-usage graph in the staff room.

· Give the manager an excusal letter allowing them to leave any meeting at no later than 3.00 pm every day.

· Replace the dishwasher with one that has a 5–6 star (WELS) rating.

· Have Goldsmith Partners apply for time to ‘make good’.

Risk Analysis Report, Action Plan and Risk Treatment.

The four major risk identified in this case include; theft of cash left on the business premises, physical injury to managers during travel, by-law compliance risk and loss of brand recognition risk.

All the above risk have a 6/10 likelihood of occurrence. Theft of cash left on business premises has the highest likelihood of occurrence with a score of 9/10. Loss of brand recognition due to staff non compliance of company expectations is the least likely to occur. The other two risks have a likelihood of occurrence of 7/10.

The consequence of cash theft on business premises is loss of revenue for the company which cumulatively leads to loss of sustainability for the business operations in the various branches. It also leads to increased debt ratio for the company since the company will not be able to pay its debts and could eventually lead to bankruptcy.

The consequence of physical injury to managers is absenteeism from work which halts various business operations. It also leads to increased litigation to the company and loss of revenue through compensation of victims.

The consequence of by-law non compliance is imposed fines from the local authority which reduces the company’s revenue. It also leads to bad reputation of the company from the public and therefore loss of potential customers and clients.

Non-compliance of staff not wearing the MacVille uniform leads to loss of brand recognition in the market segment and further hinders the company’s product promotion efforts. This reduces the overall sales and therefore a loss of significant revenue for the company.

Bank Risks – Theft of cash left on business premises

i. Implementation of company policy that will require daily banking of all the revenues collected. This will limit cases of cash being left on premise overnight and therefore reduce incidents of cash theft.

ii. Insure overnight cash holdings which will guarantee compensation from theft in all related cases.

Physicals Injuries to managers

i. Install a teleconference system to limit the amount of travel done by managers to attend meetings.

ii. Finish all management meetings at 3.00pm to prevent over night travels

By law compliance

i. Have gold smith partner apply for time to make good

ii. Carry out weekly internal audits in the company to ensure compliance of by laws for all business operations.

Non- compliance of staff not wearing Company’s Uniform

i. Install strict punitive actions for all employees not adhering to company’s regulations and expectations. This could include dismissal from work.

ii. Set aside a single day of the week (Friday) when employees can wear casual clothes.

Action Plan
RisRisks

Assess risk (score)

Controls

Monitoring

Action priority (1–5)

Timelines

Responsible

Bank Management risk

9/10

Banking of all daily revenues.

Insurance of all overnight cash holdings

Weekly basis

5

Pre-settlement

Financial controller

Managers Travel Risk

8/10

Installation of Teleconference system

Finish all meetings at 3.00pm

Weekly basis

5

Opening week

CEO with MacVille Boardof Directors.

BY-law Compliance

8/10

Application for time to “make good”

Weekly internal audits

Weekly basis

4

Within three months

Goldsmith partners

Store manager

Loss of Brand recognition

7/10

Punitive actions for non-compliance

Implementation of casual wear on Friday

Daily basis

4

Opening week.

CEO with Macville board of directors

Monitor Risk and Evaluation process

Several risk mitigation plan were implemented in the previous section of the report to minimize the four indentified associated risks. These include; banking of all daily revenue to curb the risk of cash theft on business premise, insuring all overnight holding to ensure compensation from all related theft cases, installation of teleconference system to limit frequent travels by managers, weekly internal audits, application for time to “make good”, punitive action for non-compliance by company employees and weekly audits of all business operations to ensure compliance with local authority by-laws.

Most of the risk mitigation plan have been implemented and are fully operations. The teleconference system has been installed which allow managers and other stakeholders to conduct virtual meeting without the need of travel, an accounts has been opened to allow for daily banking of all daily revenues, internal audits are being carried out on a weekly basis by the store managers, the company’s legal partners have applied for time to “make good” with the local authority. The actions that have not yet entered full implementation phase include; implementation of casual wears on Fridays, a policy to finish all meetings by 3.00pm and punitive actions for none, compliance policy.

As a result of the risk mitigation implementation, cases of cash theft have reduced significantly ranging between 0 to 1 percent. Teleconference system has proven to be effective since more meeting are being held with less travel.

The table below indicates the evaluation matrix for the risk management plan.

Risk

outcome

Banking risk

Theft cases below 1 percent

Physical injury to managers

0 cases reported since implementation of risk management plan

By- law compliance

Zero cases of litigations due non –compliance have been reported

Non-compliance of staff

All staff members are wearing company’s uniform at their respective places of work.

Assessment Task 2 BSBRSK501 Manage risk

© 2015 Innovation and Business Industry Skills Council Ltd 1st edition version: 1

Page 1 of 12

© 2015 Innovation and Business Industry Skills Council Ltd 1st edition version: 1