The Scope of Risk Management Required in My Role - Paper Example

2021-07-20 11:34:01
6 pages
1459 words
Categories: 
University/College: 
Harvey Mudd College
Type of paper: 
Report
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The scope of risk management required in my role includes technological, financial, and corporate governance.

Financial policies

The financial risks result from the ineffective management of debts. The increase in the number of bad debts written off reduces the ability of the company to finance its operations and to expand to the new markets. Besides, failure in the organization to reserve cash leads to troubles to the organization during the time of the crisis. Often, failure to balance revenue and the expenditure is a threat to the financial risks to the company.

A corporate government policy is within the scope of my roles. Failure to follow the board protocol exposes the organization to internal conflict. Board of directors is important stakeholders in the company. The board makes laws that govern the operations of the company and are responsible for strategizing for future success. However, failing to follow the board protocol exposes the organization to serious risks. Failure to meet the required standards and observing privacy standards is a risk to the business activities of the company.

The deficiency of professional business culture is a risk to the company. The external environment can be risky to the business activities of the company. In the external environment, the business needs to seek for opportunities and avoid the threats. However, failure to monitor the external business environment is risky to the organization.

Identify and describe the critical success factors, goals, or objectives for areas included in the scope.

The success factors included in the scope includes the setting of policies and procedures, business planning and budgeting, risk management review, external audit, and monthly reporting. The policies and procedures are an important success factor in risk management. Policies are tools of control in the organization where the employees are expected to follow set policies to meet the specific standards. Planning and budgeting help in effective allocation of resources and in setting the objectives for the organizations. Action plans guide the company to meet the set objectives and in attaining the missions of the company.

Risk management review is a success factor in a company. Reviewing the common risks call for the implementation of internal controls and sound risk management approaches. Reviewing risk also call for formulations of policies and procedures that help in upholding the set standards. Besides, monthly reporting is the basis for rectifying problems and monitoring keys risks in the company. The external auditors in the company give a compressive report on the financial performance of the company.

Identify relevant internal and external stakeholders, their role in the risk management process, and any issues or concerns they have raised. Complete the tale of stakeholders template (provided in the Appendix3 of this task) and attach to your report.

Stakeholder Internal/external Role in the process concern

CEO Internal Oversee the activities in the company. Make decisions. Failure to follow the set rules and regulation

Assistant manager internal Report to the CEO, oversee the juniors, Lack of professional culture

Board of directors internal Makes important make important decisions, contribute finance to the company Failure to follow the set procedures in delivery of services,

Land lord external Regulate the activities of the business, owner of the business premise Breaking by laws in the district, handle issues facing the cafe

Senior supervisors internal Foresee and report risks, analysis the progress of the company Poor coordination of activities

Customers External Raise complaints, buy from the company, are sources of information for improvements purposes Poor service delivery, expensive service from the company

Employees internal Implement the decisions and policies of the company Lack of professional culture

Complete a PEST analysis to identify risks associated with the scenario. Outline the relevant legislation, regulations, and standards.

PEST is an abbreviation that stands for the political, economic, social and technical environment. The political environment refers to the legal factors in the business environment. A number of risks emanate from political environment of the company. For example, the new law governing the water usage is a risk to the expansions of the business. The company may suffer penalties that result from excessive water usages because it is against the government regulation.

The technical environment within the business organization includes professionalism culture, privacy standards, internal control, and lack of written policies and procedures. Lack of internal control and privacy standards threatens the success of the company. Besides, the lack of policies and procedures reduces the ability of the organization to implement the effective control. The lack of appropriate business culture threatens the success of the company.

The economic environments include the presence of the buyers and sound debt control. The low purchasing power of the organization near company affects the economic progress of the company. Poor control of bad debts reduces the financial abilities of the company. It is risky to the company if the internal control is deficient. The inappropriate social environment affects the company. For example, the attitude of the population can be risky to the success of the company. The culture of the employees and that of the surrounding population can pose financial risks to the company. The social environment can be risky when components of the social environment are not appropriate.

Describe the methods of research (secondary methods) that you used to complete your PEST and SWOT analysis, for example, how you approached the simulated business information or research on risk that applies to the scope of your report.

The information used in the SWOT and PEST analysis was obtained from the stakeholders. An interview on the stakeholders of the company revealed the strengths, weakness, opportunities, and threads of MacVille Pty Ltd. Besides, the information about the political, economic, social, and political environment of the company is contained in the daily website of the company. The two sources of information were sufficient and helped in the writing of the report. The information available on the internet regarding the social and economic factors in Australia was also helpful sources of information. The rules and regulations governing business in Australia are readily available in the business journals.

After you have developed your report, write and email that is intended for relevant stakeholders for input, include a list of risks you have identified and invite them to assist in identifying any additional risks.

Email to the stakeholder in MacVille Pty Ltd

From:

To: CEO, Assistant manager, property owner, board of directors, senior supervisors team, and the consumers

Hallow to you all. This email addressed to you following desire overcomes the risk facing the MacVille Pty Ltd. The recent PEST and SWOT analysis show that the company is at risk because of poor financial budgeting, deficiency of professional culture, inadequate tools of control and the lack of sound policies and procedures in the company.

Therefore, the email seeks to inform you of the identified risks so that you give opinions on how to manage the risks. The email also gives you an opportunity to identify the possible risks facing our company. Your suggestions of the possible risks and measures to manage the risks are welcomed at your convenient time.

I write this email to you hoping that you understand the weaknesses and strengths of the company and you are willing to give your views. Your contributions on the subject are important because you understand the operations of the company better. Feel free to write back the email addressing all the queries in the entire email. I wish you all the best in your work, your contributions are highly anticipated.

Recommendations for the risk identified according to the scenario

After the analysis of the scenario, the following are the recommendations moderate the risk. There is a need for the leadership of the company practices sounds financial control. Increased number of bad debts causes financial crisis to the organization. For this reason, there is a need for planning and budget control. Besides, there is a need for the organization to adopt the cash reservation policy to help the company during emergencies.

There is a need for a professional culture in the company. Professionals should respect their colleagues, keep time, and uphold work ethics. The external business environment is the sources of threats and opportunities. For this reason, the stakeholders need to observe the external business environment seize opportunities and avoid risks.

There is a need to follow the board protocol and obey the set policies and procedures. The governance of the company is important. The employees need to observe the policies and procedures in the organization to prevent contradictions with the set laws. Rules moderate the activities of the employees, however, the deficiency of the laws and set procedures compromise with the set standards and causes lack of order. For this reason, there is a need for rules, and procedures to avoid the risks that result from the lack of the procedure and rules.

 

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