Bsbrsk 401 Task 2 case study PDF

Preview

Summary

Identify risk and and apply risk - Project based assesment - Risk management project...

Description

BSBRSK401 Identify risk and apply risk management process Assessment Task 2 – Project

Adam Muhammad

\

Victoria University SYDNEY 2019

BSBRSK401 Identify risk and apply risk management process Assessment Task 2 – Project

Question 1. List of stock risks for the new retail outlet            

Opening a retail store carries the risk of poor timing. Reputations risk Intense competition in the new store and new place Supply-chain system failure Online shopping increasing trend Technology on the system faces breaking down Supply chain collapse on the distribution system in the retail Regulatory and policy change including the government and trade policy From customer perspective it could be the failure in innovation Crime, theft, fraud, stealing, shoplifting, and employee dishonesty. High turnover rate Form economic perspective it could be the down of customer spending

Question 2. List of the people in organization and the correlation to the risk project management. Human resources Chief Executive Officer

Human Resource Manager

Marketing Manager

Business operation manager

My team at Grandeville store

Correlation Responsible for the whole activity in the business, discuss and evaluate the current condition and prepare the strategy to present in order to make sure the unit business strategy can match to organization strategy and get accepted to operate. Heading to HRD to consult the new system to put ethics and honesty indicators to consider for the new store, this process will evaluate how effectiveness to solve the thief and dishonesty current retail and make sure the new one will solve the problem and get the better rate of turnover. The discussion related to how to provide and utilize marketing strategy including promotion in the new store, to make sure risk of sales would be covering. The person in charge as the key indicator for current problem of the company, connecting to stock security and stock loss. The supply chain management as the main problem that need to discuss and analysis, the business operation will help to make the better system of supply chain to make sure the new outlet of Grandeville will be run effective and successful. The employees that will become the center of attention from the management to see that Key Performance Indicator work properly and give the

satisfaction result. Question 3. As the risk will be identified early for the better effectiveness and efficiency for the company, one of the important step including proper documented for all activity that correlate to the risk. Some of the process will meet and check to the current company’s policies such as procedures, legal condition, and any requirement that will affect the business activities while the risk management work on the filed. It is simply to avoid the risk management project and activity that against the legal requirements of the organization. Code of conduct The code provides the standards of behavior for workers and to provide procedure that create all employees informed about the responsibilities to execute their works in a proper condition. These standards represent the several principles, they are:     

To work with respectability and professionalism in the execute of tasks and to be conscientious in the accepted use of company’s data, funds, equipment, and facilities To conform to all requirements of this standards and procedures, policies, and regulations The employees need to consider about reporting any breaches or suspected breach of this code, policies, procedures and applicable laws and regulations The employees need to exercise fairness, equity, proper courtesy, consideration and sensitivity in all dealings, in the course of carrying out duties To stay away from real, apparent or perceived conflicts of interest where this code requires notification to BizOps, employees need to report the notice for the management accordingly.

Honesty and fraudulent behaviour In order to develop good corporate coordination and facing the problem of current issue (Security in stocks of retail), the part of honesty and integrity standards are fundamental to Bizops Company. Employees have to:     

Work with the highest degree of honesty and integrity in all aspects of tasks in Bizops. Avoid stealing company’s property, misappropriating or coveting any devices and things for personal reason. Straightaway report and communicate to Bizops representative for activity that is including fraud, theft, and any dishonest behavior for the internal and external company’s activity. Never cooperate with a client or anyone in the company activity that is evading the law for example to participate in any activity that involves theft, fraud, stealing or misappropriation of property, including that of BizOps internal and external (employee and client) Act with integrity, the worker have to avoid any condition and activity that potentially brings BizOps into disrepute or endanger its relationship with clients or public. A breach of the code of conduct in this respect may also constitute a criminal action.

Internal controls and systems  

The company of Bizops already established the procedure and control standard for the system including many technical condition and standard in order to provide and ensure the asstes of company are properly used, safety, and protected. The employees have to share the knowledge and responsibility for providing and maintaining the



internal control that relevant to accurate data, reliable financial records, and reports. The employees need to develop clear coordination and work based on the standard procedure for each business unit.

Serious misconduct and summary (instant) dismissal In certain occasions, unacceptable action or performance may constitute serious misconduct and potentially result in summary (instant) dismissal. The condition and dismissal is potentially happened without notice and prior warnings. While not an exhaustive list, employment may be terminated without notice for any of the following causes:         

Shoplifting, Theft, Stealing, and any criminal activity Sexual harassment Serious harassment Misleading or defrauding BizOps Physical or psychological abuse including threats of violence Significant misuse or damage of company property Serious safety breaches or serious breaches of the BizOps code of conduct or company policies Disregard for the law

Suppliers policy The retail company, Bizops, always faces and works with suppliers in order to run the business, the management make sure the employees follow the guide to choose and work with the appropriate supplier. Two indicators need to consider as mentioned below: Payment terms and insurance      



Negotiate payment terms is the first action to consider with supplier before make any cooperation further. Make sure the discount and special price for any earlier payment The clear agreement and payment term Mention the condition where the good is not in acceptable condition (damaged or unsuitable goods) and how the further process after that. Clear documentation and good communication for any further condition related to any issue in supply chain condition to supplier. Scheduled meeting for review the terms with supplier and open discussion for any activity that to keep cooperation, for example you can discuss to current supplier if finding the better alternative supplier before take immediate action for changing the cooperation. Ethics and loyalty is value in doing business. Check the supplier condition related to avoid any activities that against the law before receive the products.

Maintain creditor relationships   

Regular meeting is arranged to keep coordination and review the process in doing business The procedure that supplier take if the mistake come from the Bizops side, for example process, information, and people in charge. Clear information and procedure if any condition that reflect the incapability of company for fulfill the obligation, for example, the condition where Bizops can not pay on exact date (late

 

payment), how the process and clear penalty and relevant condition. Good communication and become credible to cooperate with Make sure the Bizops Company highlight the standard for all legislative requirements in terms of privacy, ethics, copyright, etc.

Question 4. Background Risk management can be describe as the process and method to identify and the action to take for counter the risk in the business, the activity including preventing, avoidance, reduction, sharing, and retention. The condition is usually happened for financial sector and risk but can also apllied in other business unit situations since the corelation each departement will contribute for the company and revenue at the end. The risk management is becoming recent consideration from Bizops company since the condition of company face the lose in some area of business model, the approriate controls is needed to develop mitigate for each risks, and the plan of risk management project need to get approved by the proper level in managgement besore execution. The company of Bizops make the strategy in oepration business by open the new retail store/outlet at Grandeville mall, this location of business wil become the movement from company to become standrad and benchmark for other as the better and professional operation. Context The main indicators to assess in Grandeville outlet are the loses of stock in the distribution-handling process and level of stock loses that involving shoplifiting activity. As the experienced retail outlet manager, the project will take over the issue and make the new system for better operation in supply chain as good example to other retail store. Some procedure will be made based on the standard of risk management, starting by identification and analysis, risk categorisation matrix, risk control/treatment, and the implementation plan. Identification and analysis Grade

Level of likelihood

A

Expected (will occur regularly)

B

Probable (will occur at some stage)

C

Possible (could occur)

D

Improbable (could occur but unlikely)

E

Rare (may occur but in limited situations)

Risk likelihood legend

Grade

Level of impact

1

Insignificant

2

Minor

3

Moderate

4

Major

5

Catastrophic

Risk impact/ consequence legend

Risk categorisation matrix Level of likelihood

Level of impact 1 (Insignificant)

2 (Minor)

3 (Moderate)

4 (Major)

5 (Catastrophic)

A (Expected)

Medium

Medium

High

Extreme

Extreme

B (Probable)

Medium

Medium

Medium

High

Extreme

C (Possible)

Low

Medium

Medium

High

High

D (Improbable)

Low

Low

Medium

Medium

High

E (Rare)

Low

Low

Low

High

Medium

Risk categorisation table Priority 1

2

3

4

Risk

Employee Theft

In-store Shoplifting

Theft by Delivery agent

Fraud by Supplier/Third party

Likelihood

Impact

Level of risk

Expected

Moderate

High

Expected

Major

Extreme

Probable

Moderate

Medium

Possible

Minor

Medium

Risk control/treatment Activity: Risk Management Project (priority 1) Risks Employee Theft

Control measures/ treatments

Control measure

Strength

Weakness

Reduce the risk by checking control processes, auditing, and training

Applicable and measureable, easy to adapt and control

Reduce time in operation to extra training and more budget

New Key performance indicators documents

People in charge to handle the theft problem with the new system and code of conduct

Impact of risk/s on areas outside your responsibility

Easy to control and can supported by technology system and automation

Time in changing from current system, consuming more time, and potential error will be facing during transition

Easy to control and clear direction for tracking the problem

Potential error in human and lead to bigger loses in current problem, for example, the theft is start from the supervisor until employees

Revenue of company will decrease chaos in supply chain on warehouse because the data is not equal.

Personnel involved

Human resource department for selecting the right person for taking supervisor place. Also, provide the training from internal HRD or using third party/trainer.

Expected outcomes of risk treatment plan

The risk of stock loses from internal/employees will be reduce and can decide the main factor to tracking the issues before in the company.

Activity: Risk Management Project (priority 2) Risks In-store Shoplifting

Control measures/ treatments

Control measure Handle the risk by set up the CCTV in some

Strength

Weakness

Easy for control and

New budgeting for

spot of store

Coordination with the Mall management and security system

get the direct result related to possible risk cause.

technology and new training for employees to operate

Collaboration will bring the good advantage for the both side as mall management and Bizops company.

The mall security system is potentially not cover all the area and private area of the retail store.

More benefit for the Bizops company because using the facility from the Mall

Assertive to process the law for the shoplifting

Providing the clear and assertive action for the potential theft person, and can cause the string psychology war that make crime decrease

Each store has its own responsibility and policy related to shoplifting. Hard to track random people in the huge area of Mall Not effective for all the time.

Impact of risk/s on areas outside your responsibility

Revenue will decrease and give impact to financial department, stock loses will influence the supply chain activity in operation department

Personnel involved

Manager, Supervisor, Mall management, Security system personnel, IT department

Expected outcomes of risk treatment plan

Reduce the shoplifting that become potential cause of the risks

Activity: Risk Management Project (priority 3)

Risks Theft by Delivery agent

Control measures/ treatments

Control measure

Strength

Weakness

Avoid the risk by changing process and code of conducts

Applicable, quick, and measureable

Take time for training and introduce the new system

Find the root cause the broken system in current process for distribution and coordination with the supplier

Easy to track the root cause in distribution system

Not all the supplier can collaborate with the fraud activity and related to reputation and sensitivity

Considering the people in charge to responsible the failure

Easy to measure the old system

The problem will become worst if the supervisor as the cause and coordination will all supply chain process

New technology system in tracking for distribution

Simple and quick way to check where the loses is happened

Expensive

Just using the good communication and relationship between two company, bizops and supplier

Impact of risk/s on areas outside your responsibility

Reputation of the company and supplier, operation department will face the problem of the loses and inventory data, financial department and the revenue of the company

Personnel involved

Manager of Operation, Supervisor, and Supplier employees (driver and staffs)

Expected outcomes of risk treatment plan

The effectiveness of the new system will bring the result of how possible the risk of loses stock is happened from this side and operation from supplier side.

Activity: Risk Management Project (priority 4) Risks Fraud from supplier

Control measures/ treatments

Control measure

Strength

Weakness

Reduce the risk by checking control processes and auditing

The control by the agreement before cooperation and easy to track and under law

Poor controlling will lead the loses

Understanding the root cause problem and cut the old system and hire third party to become legal and middle man to analysis

Effective if the using third party as the middle man to track the problem

New extra budget

People in charge for the case, avoiding the new store face the same problem

Between supplier and Bizops hire middle supervisor to track all activity to avoid some fraud

New extra budget and potentially bigger lose if the chose the wrong person

Damaged and unsuitable goods in purpose by using technology system to check and monitor

Easy to track the condition for each goods before and until inventory of store

Expensive and need more human resource to monitor

Impact of risk/s on areas outside your responsibility

Damaged goods will cause reputation of company and will give risks and impact to marketing department – lose of stocks also give operation department responsible to company – financial department will evaluate and deliver impact revenue

Personnel involved

Manager of Operational, Store Manager, Supervisor, Staffs, Supplier worker

Expected outcomes of risk treatment plan

As long as the monitoring system work properly, the risks that happened from this activity will be easily tracking and reduce the impact and lose.

Implementation Plan

Risk

Level High

Action New system control - Training KPI - Code of conduct impementation supervisor system CCTV system New technology checking - Earlier detector device for goods and products

Estimating Budget Additional 40% from annual training budget ($200.000)

Time 3 months training monitoring

$15000 for initial instalament and $500 for each months for maintenance and monitoring

1 month instalment and training

Medium

New terms and agreements for supplier – new sustem control and technology device

$20000 for controling software and supply chain monitoring

3 months instalment and training

Medium

New terms and agreements for supplier (reassess contracts) – hiring professional analyst related to

$5000 for consultant

1-2 months

Employee Theft

Extreme In-store Shoplifting

Theft by Delivery a...