BSB51915 Diploma of Leadership and ManagementBSB51915 Diploma of Leadership and Management

ASSESSMENT COVER SHEET
Course NameBSB51915 Diploma of Leadership and Management
Unit Code and NameBSBRSK501 Manage Risks
Trainer/Assessor Name
Student ID:Student Name
 

 

Results

 

 

Individual Assessments

Results

Assessment 1C             NYC 

Final Result

C
Assessment 2C             NYC
NYC
Assessment 3C             NYC
Assessor SignatureDate
Feedback to student
 have received the assessment feedback on____________________ (Date)
Student Signature
Assessor Signature

Assessment Schedule

 

Week NoAssessment NameTasks to CompleteTrainer/Assessor Comments
Week 1Assessment 1:

Report on risks

Start assessment task 1
Week 2Risk review report, including a completed table of stakeholders

Email to stakeholders

Due – Assessment 1

Week 3Assessment 2:

Analyse and treat risk

Start assessment task 2
Week 4Risk analysis report, including a risk matrix

Risk management action plan

Implement one risk treatment and submit evidence as agreed

Due – Assessment 2

Week 5Assessment 3:

Monitor risks and evaluate

Completed written report

Due – Assessment 3

Assessment 1: Report on risks

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 required to determine the risk context associated with establishing a new business outlet within the existing business structure. You will be required to review internal and external environment factors, obtain support for activities and liaise with relevant stakeholders to identify risks.

Assessment description

For the MacVille Pty Ltd simulated business scenario provided, you are required to assume the role of Sydney 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:

For this assessment task, you will need to review the simulated business’s risk management processes and determine the scope and objectives, taking into account stakeholders and both internal and external environmental factors affecting the organisation. Once you have gathered this information, you are to identify risks and write a draft report to the CEO.

You will meet with the CEO to discuss your report, seek support for your findings, and approval to communicate risk management processes to relevant stakeholders for their feedback and participation.

Procedure

You will assume the role of Ash, Assistant Manager of the Sydney MacVille café, who has just been promoted to Manager of the new Parramatta store. In preparation for the new venture, Ash has been tasked with conducting a risk management analysis of this project:

Excerpt of email from CEO Paula Kinski

From: CEO – P. Kinski

To: Assistant Manager – Church Street Store

Re: New Parramatta Store

Congratulations on your new appointment. Prior to taking up your position as Manager of our new Parramatta store, located in Church Street, the Board of Directors has asked that the risks in this project be appropriately managed.

 

I want you to undertake this task as it will give you significant insight into the store’s operations, it will ensure a smooth transition for Hurley’s Café staff into the MacVille family and will encourage you to give ongoing support for our risk management initiatives.

 

I would like you to approach this task in three stages and meet with me at the end of each phase to review your work and discuss your plans for the subsequent phases. The three stages in this risk management task will include:

1.       Review.

2.       Analyse and plan.

3.       Monitor.

Once I have received your risk review report, we will need to discuss the steps that you will take in the risk management process.

Regards

P. Kinski

CEO MacVille Cafés (NSW)

 

  1. Review the provided MacVille simulated business scenario information and documentation provided in the Appendices of this task.
  2. Write a report for the CEO (your assessor) that addresses the following:
    1. The effectiveness of the MacVille Risk Management Framework in supporting the principles and processes of risk management, set out in the risk management standard AS/NZS ISO 31000:2009. Outline the purpose and key elements of the standard in your discussion.
    2. Identify and describe the scope of risk management required in your role.
    3. Identify and describe the critical success factors, goals or objectives for areas included in the scope.
    4. Identify relevant internal and external stakeholders, their role in the risk management process, and any issues or concerns they have raised. Complete the Table of Stakeholders Template (provided in Appendix 3 of this task) and attach to your report.
    5. Complete a PEST analysis and a SWOT analysis to identify risks associated with the scenario. Outline the relevant legislation, regulations and standards (including those at a local level, i.e. Parramatta Council).
    6. Describe the methods of research that you used to complete your PEST and SWOT analysis. For example, how you approached the simulated business information; legislation, regulations, etc.; and any other information or research on risk that applies to the scope of your report.
    7. Complete the analysis of risk for the scenario by summarising the scenario and identifying a list of risks to the project.

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 summary.

  1. Submit your report as per the specifications on the next page. Be sure to keep a copy for your records.
  2. After you have developed your report, write a draft of an email that is intended for relevant stakeholders (identified in Step 2). Your email draft should clearly ask stakeholders for input, include a list of risks you have identified and invite them to assist in identifying any additional risks. Submit your draft email to your assessor as CEO along with the following in writing:
    1. your understanding of the critical success factors and goals
    2. Give the MacVille risk management process
    3. Explain in your document, how you can communicate with stakeholders about the risk management processes in this scenario and invite them to participate in discussions to further identify risks associated with the scenario
    4. obtain the CEO’s support for ongoing risk management activities
    5. ask the CEO for input on additional risks.
  3. Submit the required documents for assessment as per the specifications below. Be sure to keep a copy for your records.

Specifications

You must provide:

  • a risk review report, including a completed table of stakeholders
  • email communication to stakeholders

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
  • written and oral communication skills
  • numeracy skills to interpret mathematical data when reviewing and analysing scenario business information
  • ability to work independently as well as collaboratively to make decisions about risk management
  • 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 scope, goals and objectives and to evaluate options
  • ability to use familiar digital technology to access information, document findings and communicate them to stakeholders.

Appendix 1: MacVille Pty Ltd (simulated business)

Background

As part of their overall strategy in the Australian beverage market, MacVille Pty Ltd have developed a chain of cafés in the Central Business District (CBD) of Sydney, NSW. The Board of Directors has made the decision to expand their operations in Parramatta with the purchase and re-branding of the existing Hurley’s Café in Parramatta, the second largest CBD after Sydney CBD in NSW.

 

Ash is currently the Assistant Manager of MacVille’s flagship café in Sydney CBD, and has been given the opportunity to manage the new store in Parramatta. Ash is also a member of the Finance, Audit and Risk Management (FARM) Committee described in the MacVille Risk Management Policy.

 

The CEO for MacVille’s cafés, Paula Kinski, has assigned Ash the task of managing the risks involved with the operational aspects of this takeover. A copy of her email is provided below.

Email from CEO Paula Kinski

From: CEO – P. Kinski

To: Assistant Manager – Queen Street

Re: New Parramatta store

Congratulations on your new appointment. Prior to taking up your position as Manager of our new Parramatta store, located in Ruthven Street, the Board of Directors has asked that the risks in this project be appropriately managed.

 

I want you to undertake this task as it will give you significant insight into the store’s operations, it will ensure a smooth transition for Hurley’s Café staff into the MacVille family and will encourage you to give ongoing support for our risk management initiatives.

 

I would like you to approach this task in three stages. After the first stage, we will meet to review your work and discuss your plans for the subsequent phases. The three stages in this risk management task will include:

1.       Review.

2.       Analyse and plan.

3.       Monitor.

Your primary risk management focus is directed to the ongoing operations of the Parramatta café. The strategic and investment risks of this project are being managed by the Board. To this end, you are to consider any risks that could impact on human resources management, financial operations, WHS, our supply chain and the local governance and overall compliance issues.

MacVille has agreed to employ all existing staff at Hurley’s Café on three months’ probation. The current supervisor of Hurley’s, James Mansfield, has been offered the position of 2nd In Charge and he has accepted.

While settlement on the purchase of the business is not for another few weeks, the seller has agreed to grant us full access to the store’s operational processes and store information. You should liaise weekly with the Finance, Audit and Risk Management (FARM) Committee here at Sydney CBD concerning the marketing, finance and store management functions that you are investigating. I will set up a regular meeting for you.

Sydney CBD office has a report on expansion conducted by the internal office team that may help you in your research. You may need to review other statistical information and engage specialists to help you with your investigation. The legal firm Goldsmith Partners are advising MacVille on the Hurley’s Café acquisition and would be available to help you with legal or any compliance issues.

The landlord of the shop in Parramatta, Ron Langford, is also a local councillor and has offered his assistance in getting established in Parramatta. He has offered his availability for email address for correspondence.

When you have finished your report, please name it according to our document naming conventions and send it through. Once I have received and discussed your risk review report, we can move onto the next stage of the risk management process.

Regards

P. Kinski

CEO MacVille Cafés (NSW)

 MacVille document naming convention

Files should be saved using the document name, the date and the document version. For example, a meeting agenda for a meeting on 1 March 2014 would be saved as ‘Meeting Agenda 01032014 v1’.

Site visit – New Parramatta store (the existing Hurley’s Café)

You received permission from Paula to travel to the Parramatta store to start your research. Paula had cleared it with James Mansfield, the current senior supervisor, who will spend most of the day with you helping answer your queries. She also arranged for you to spend time with Ron Langford, the store’s landlord.

Meeting with James Mansfield

You arrived at the café and noted the 45 minutes drive time that it took to get there from the CBD of Sydney in business hours. You met with James, who took you through a complete overview of the store and the surrounding area. He was OK with the idea that you needed to take notes in preparation for a report. After lunch, you went over your notes to revise and edit key concerns and significant events that you had written down earlier:

Notes from meeting with James Mansfield
●      The location of the store on the corner of the two main streets of Parramatta makes for easy access for local customers and high visibility for tourists.

●      The drive from Parramatta to Sydney would make attending the weekly managers meeting difficult considering many meetings did not finish until into the evening after refreshments. There are also manager training sessions that need to be completed over the next six months in with a few other assistant managers. Navigating through the heavy traffic is difficult even in daylight hours. Being a competent driver you feel that it would be unlikely that you would be involved in an accident, but it still concerns you considerably.

●      The two-hour delivery time would make fresh pastry deliveries from the company’s central bakery plant impractical. The pastries would arrive after the morning rush. These are a key part of the MacVille product assortment.

●      There is also a concern about getting the company-branded supplies through as quickly as a CBD Sydney store could.

●      Hurley’s Café was a family-run store and some family members were employed on the staff. James was engaged by the family to supervise the operations of the store and Mr Hurley as manager would authorise wages but anyone can authorise deliveries.

●      When asked about written policy and procedures manual, James said that Mr Hurley set the policy and procedures verbally and on the few days each week he was in the store he would show the staff how to do things the way he wanted them done.

●      Water use – Water wastage present; the dishwasher is often run when only half full; fruit and vegetables are washed under a fast-running tap; toilets all use the single flush system; James explained that Mr Hurley instructed the staff to keep the non-native flowering plants in the courtyard fully watered.

○     The dishwasher was always set to the full wash setting and has a Water Efficiency Labelling and Standards Scheme (WELS) rating of 3. The more water efficient 5–6 star dishwashers cost about $6,000 and above.

○     Dual-flush system would cost about $7,500 to upgrade.

The store currently uses 41,500 litres a week.

●      James spoke about the café attracting a large percentage of retirees because of the easy access to buses and the store’s central location.

●      The same staff member that completed the cash register balancing also completed the bank deposit form and did the banking as well. The banking was not done every day and often $4,000 was kept on the premises overnight in the cash register. There was no safe. There is a bank two shops away but the Hurley family bank is a couple of blocks away and there was not always time to do the banking.

●      James replied to your question about the possibility of break-ins, saying that there was a 50% chance of it happening in a year and the consequence was moderate.

●      Not all takings from the cash register by family staff members were recorded.

●      The fit-out looked old and unattractive in parts, with some chairs unstable and broken and some parts of the worn carpet were simply taped over with gaffer tape.

●      One of the staff was a qualified chef who had developed an innovative and popular range of rice wraps that were tasty, gourmet and healthy. None of the other cafés in the area offered these.

●      No established process for dealing with injuries that happened at work.

●      James gave a brochure about an innovative frozen par-bake cooking system that was under the limit set by council for an exhaust system, yet it cooked fresh bakery items in 30 minutes from frozen par-baked pastries.

●      The computer with all the store’s employee details, and financial records was not password protected and anyone could access the information.

●      James’s response to your question about the lack of sales promotion techniques was that he could not get the staff interested in the activity so he stopped trying to make it happen.

●      The employee detail form requested information about the employee’s entire past health issues.

●      The wage and superannuation records seemed to be incomplete, with many calculations being worked out by the number of hours worked multiplied by a set ‘in the hand’ amount.

●      James also provided a brochure about a company that could come and set up WiFi in the café so that customers could use their computer notebooks and connect to the internet while they were dining in the café.

 Meeting with Ron Langford

You met with Ron Langford in his office to discuss the café, council by-laws and aspects concerning the surrounding district. You took notes that included the following significant information.

Notes from meeting with Ron Langford
●      Ron explained that there were opportunities for opening more cafés in the surrounding shopping centres like Westfield and Parramatta Shopping Centre on George Street.

●      Ron handed you an extract from a government report, ‘Economic Brief’.

●      Ron explained that the federal government was now introducing legislation that backs up the local by-law concerning efficient water usage, particularly by industries. The current by-law has fines of up to $50,000 for excessive water breaches. Ron did explain that the council was allowing some time to ‘make good’ under certain circumstances on a case-by-case basis. Ron also agreed with the idea of installing a water tank in the courtyard for the café to use and would help get it built.

●      Ron explained that Parramatta was obviously a place for business growth and the population was growing.

●      Ron spoke about the federal government’s National Broadband Network in Parramatta, which would allow efficient and effective video streaming and teleconferencing.

●      Ron spoke about a current by-law that allows cafés to expand their footpath dining and so put more tables and chairs outside their premises.

●      Ron also spoke of the fact that representatives of a large international chain of coffee shops had been making enquiries around about opening a store in the Parramatta CBD.

 

Meetings with Senior Management Team and Finance, Audit and Risk Management (FARM) Committee

Soon after you returned from your research trip to the Parramatta store, you attended two teleconferences.

First teleconference

First, you met with the senior management team. At this teleconference, you discussed issues raised by James Mansfield and Ron Langford and the report on previous NSW expansion, which Sydney CBD office had given you: Report into the acquisition and re-branding of the NSW expansion store. Paula said that there may be some things to learn from the report.

Key problems identified in the report were as follows:

  1. Lack of internal controls, particularly over cash handling, monitoring and recording.
  2. Failure to meet compliance standards in WHS, privacy and industrial relations law.
  3. Lack of written policy and procedures to guide staff in carrying out their duties.
  4. Lack of a professional business culture in the family run business.
  5. Failure of the business to monitor the external environment and find opportunities and threats to the business.

The team agreed that similar issues would pose a risk to the Parramatta expansion.

Second teleconference

You then held a teleconference with the FARM Committee. At the teleconference, you relayed the concerns of the senior management team. The FARM Committee decided to allow you time to complete your review and then would include discussion of your review in the monthly Board of Directors meeting.

Appendix 2: MacVille Pty Ltd – Business plan (excerpt) 

MacVille Pty Ltd: Risk management policy

Introduction

MacVille recognises that risk management is an essential component of good management practice and is committed to ensuring the implementation of risk management processes that focus on the proactive management of risks across the organisation.

This risk management policy forms part of MacVille’s internal controls and corporate governance arrangements. The risk management policy is designed to:

  • identify, evaluate, control and manage risks
  • ensure potential threats and opportunities are identified and managed
  • inform directors, senior management and staff members about their roles, responsibilities and reporting procedures with regards to risk management
  • ensure risk management is an integral part of planning at all levels of the organisation.

Policy

MacVille is committed to achieving its vision, business objectives and quality objectives by the proactive management of risk at all levels of the organisation.

MacVille will identify, evaluate, control and manage risk throughout the organisation in accordance with the ‘MacVille Risk Management Framework’. See risk management strategy for framework details.

Responsibility and Authority

Directors, management and employees of MacVille have responsibility for implementing aspects of this policy.

Role of the Directors

The Directors have a governance responsibility in the management of risk. This includes:

  • determining which types of risk are acceptable and which are not
  • setting the standards and expectations of staff with respect to conduct
  • approving major decisions affecting MacVille’s risk profile or exposure
  • monitoring the management of significant risks to reduce the likelihood of potential organisational risks and threats or failure
  • being satisfied that risks are being actively managed, with the appropriate controls in place and working effectively
  • annual review of MacVille’s approach to risk management and approval of changes or improvements to key elements of its processes and procedures.

Role of the Senior Management Team and Store Managers

Key roles of the senior management team are to:

  • implement policies on risk management and internal control where this is deemed appropriate
  • identify and evaluate areas of significant risks potentially faced by MacVille for consideration by the Directors
  • identify areas where risk management is not adequately addressed and advise the Directors accordingly
  • review and update the Risk Management Strategy

 

  • undertake an annual review of the effectiveness of systems of internal control and provide an annual report to the Directors, including a summary review and respective recommendations.

Role of Café Employees

Key roles of employees are to:

  • familiarise themselves with the content of the Risk Management Policy and clarify any aspects necessary with a senior team member
  • consider any risks they feel could impact on them meeting their objectives and either manage the risk if it is in their control to do so, or inform a management team member of their concerns
  • advise senior management, in the first instance, or the Board of Directors, if concerned about any fraud or unethical behaviour.

MacVille Risk Management Framework

This framework encompasses a number of elements that together facilitate an effective and efficient operation, enabling MacVille to respond to a variety of operational, financial, commercial and strategic risks. These elements include:

  • policies and procedures
  • monthly reporting
  • business planning and budgeting
  • risk management review
  • external audit.

Policies and procedures

A series of policies underpin the internal control process. These policies are endorsed by the directors and are implemented and communicated by the senior management team to all staff. These policies include:

  • Human Resources Policies:
    • Staff Travel Policy
    • Harassment Policy
    • WHS Policy
    • Return to Work Policy
    • Work–Life Balance Policy
    • Equity/Discrimination/Diversity Policy
    • Parental Leave Policy
    • Organisational Culture Policy
  • Financial Policies:
    • Bad Debt Policy
    • Cash Reserving Policy
    • Revenue/Expenditure Recognition Policy
    • Finance, Audit and Risk Management (FARM) Committee Terms of Reference, including delegations
  • Corporate Governance Policies:
    • Board Protocol
    • Sitting Fees Policy
    • Directors Remuneration Policy.

Monthly reporting

Decisions to rectify problems are made at regular meetings of the senior management team. Comprehensive reporting at Board and Sub-committee meetings is designed to monitor key risks and their controls.

Business planning and budgeting

The business planning and budgeting process is used to set objectives, agree on action plans, and allocate resources. Progress towards meeting business plan objectives is monitored regularly by the senior management team and by Directors at Board meetings.

Risk management review

The Finance, Audit and Risk Management (FARM) Committee is required to report at Board meetings on internal controls. The FARM Committee pays particular attention to risk management. It is the CEO’s responsibility to brief the Directors periodically and as appropriate on the development of policies and procedures to ensure effective and efficient operations, risk management strategies and implementation. In addition, the FARM Committee oversees internal audit, external audit and management as required in its review of internal controls. The committee is therefore well placed to provide advice to the Board on the effectiveness of the internal control system, including MacVille’s strategy for the management of risk.

External audit

The final audit of financial statements is controlled by an external chartered accountant who provides feedback to the Board through the FARM Committee.

 

Procedure: Development of a Risk Management Profile

The following outlines the process for developing a risk management profile.

1. Establish the context:

  • Define and identify the environment, characteristics and stakeholders, their goals and objectives, and the scope of the specific risk management process.
  • Develop criteria against which risks are evaluated and identify the structure for risk management.

2. Identify and describe risks:

  • Risks are best identified through a collaborative approach involving a cross-section of stakeholders.
  • All conceivable risks must be considered. Ensure any certainties are identified as problems and addressed in the risk management profile.

3. Conduct current risk analysis:

  • An analysis of the risks is conducted to determine their causes, and estimate their probability and consequences. This analysis provides the basis for working on the ‘right’ risks.

4. Conduct risk evaluation:

  • Risks are considered and prioritised according to their potential impact, and each risk is assessed to determine its level of acceptability.

5. Develop and implement proposed risk treatments:

  • Risk treatments are developed to cost-effectively reduce, contain and control risk.
  • Formal risk management reporting mechanisms are defined and documented.
  • Categorise the risk likelihood.

6. Monitor, report, update and manage risks:

  • As risks change constantly, the risk profile is continuously monitored, reviewed and updated by management. New risks may be identified as more information becomes available and existing risks may be eliminated through the effectiveness of the risk treatments/actions.
  • Identified risks, and monitoring and management activities should be recorded and stored as follows:
    • risks identified through regular audit should be recorded on the Risk Audit Log
    • risk management activities should be recorded on the Risk Management Register.

MacVille’s Risk Areas

The following are four broad areas where potential for risk to MacVille has been identified. Under each area, examples of possible risks are detailed.

Operational/organisational:

  • legal and regulatory compliance
  • technology
  • insurance
  • resources: human, physical
  • logistics
  • marketing
  • product quality
  • communications
  • infrastructure, plant and equipment
  • customer interaction
  • market needs.

Financial:

  • accountability
  • fraud or theft
  • capital investment

 

  • interest rates
  • loss of income, funding/finance.

Governance:

  • conduct of Board of Directors
  • conflict of interest.

Project management:

  • procedures and tools for project management
  • stakeholders – strength of relationships/conflict of interest
  • human resources
  • financial resources.

MacVille Pty Ltd: Risk management strategy

Introduction

MacVille recognises that risk management is an essential component of good management practice and is committed to the proactive management of risks across the organisation. The strategy is designed to:

  • identify, evaluate, control and manage risks
  • ensure potential threats and opportunities are identified and managed
  • inform directors, senior management and staff members about their roles, responsibilities and reporting procedures with regards to risk management
  • ensure risk management is an integral part of planning at all levels of the organisation.

Guiding Principles

  • MacVille is committed to achieving its vision, business objectives and quality objectives by the proactive management of risk at all levels of the organisation, acknowledging that embracing innovative ideas and practices carries with it risks, but that these are identifiable and measurable and therefore capable of being subject to realistic risk mitigation processes.

Responsibility and Authority

  • The Board of Directors have responsibility for ensuring that risk management is in place.
  • The Finance, Audit and Risk Management (FARM) Committee has the responsibility of reviewing the Risk Management Action Plan on a six-monthly basis.
  • The CEO and the senior management team have responsibility for managing risk and advising the Board on appropriate controls.
  • The CEO and the senior management team support and implement policies approved by the directors.
  • Key risk indicators will be identified, closely monitored and action taken where necessary, by the staff and directors.

MacVille Risk Management Framework

This framework encompasses a number of elements that together facilitate an effective and efficient operation, enabling MacVille to respond to a variety of operational, financial, commercial and strategic risks. These elements include:

  • Policies and procedures: A series of policies underpin the internal control process.
  • Reporting: Decisions to rectify problems are made at regular meetings of the senior management team.
  • Business planning and budgeting: The business planning and budgeting process is used to set objectives, agree on action plans and allocate resources. Progress towards meeting business plan objectives is monitored regularly by the senior management team and by directors at Board meetings. Contingency planning is undertaken as required.
  • Risk management review: The FARM Committee is required to report at Board meetings on internal controls.
  • CEO: The CEO has responsibility to brief the Directors periodically and as appropriate on the development of policies and procedures to ensure effective and efficient operations, risk management strategies and implementation.
  • External audit: The final audit of financial statements is controlled by an external chartered accountant who provides feedback to the Board through the FARM Committee.

Definitions

Risks are identified on a scale of likelihood of occurring in the next 12 months and assigning an impact or consequence to the risk as high, medium or low. High includes either a significant shortfall of around 40% in achieving budget or a significant reduction in ability to function. Medium includes either a shortfall of budget of between 10% and 20% or some reduction in function. Low indicates minor reductions in achieving budget or minimal reduction in performance.

 

Appendix 3: Table of stakeholders template

StakeholderInternal/externalRole in processStake in process
    
    
    

 

 

Marking Guide

Assessment 1: Report on risks

Outcomes

Did the candidate:Satisfactory
YesNo
Submit a risk review report, including a completed Table of Stakeholders?
Submit a draft email communication to stakeholders?
Submit the deliverables in the agreed timeframe and format?

Performance indicators

Did the candidate:Satisfactory
YesNo
Discuss in their report how effective MacVille’s Risk Management Framework is in supporting the principles and processes of risk management set out in AS/NZS ISO 31000:2009 Risk management – principles and guidelines, outlining the purpose and key elements of the standard?

For example, they included discussion that the standard:

●      provides guidance to enable public, private or community enterprises, groups or individuals to manage risk, which can allow:

○     increased likelihood of achieving objectives

○     encourage proactive management

○     promote organisational awareness of risk, etc.

●      views the analysis and evaluation of risk as two separate elements

●      outlines seven elements in the risk management process:

1.     Establish the context

2.     Identify risks

3.     Analyse risks

4.     Evaluate risks

5.     Treat risks

6.     Monitor and review

7.     Communicate and consult.

For example, identifying the effectiveness of the MacVille framework in supporting the standard may include, but is not limited to:

●      the MacVille framework recognises that risk management should be integral to all organisational processes

●      the steps in the procedure reflect the process set out by the standard

●      MacVille’s framework could be improved by including more explicit requirements for communication and consultation with stakeholders.

In the report, identify and describe the scope – covering at least the following:

●      Project – MacVille to expand their operations in Parramatta and purchase and rebrand an existing café in Parramatta.

●      Business unit – MacVille cafés Sydney, NSW

●      Risk in relation to business functions – human resources management, financial operations, WHS, supply chain, local governance and compliance issues, loss of brand recognition?

In the report, identify and describe goals – should include some of the following:

●      to appropriately manage the risks involved with the operation of the Parramatta store

●      to give the new manager significant insights into the store’s operations

●      to ensure there is a smooth transition to the MacVille systems

●      to encourage the new manager to give ongoing support for risk management?

Identify relevant internal and external stakeholders and their roles in the risk management process?

For examples, see the Stakeholder Feedback Table that follows this Marking Guide table. This list includes possible stakeholders, and is not exhaustive.

Identify risks associated with the analysis using tools, such as PEST and SWOT analyses?

For example:

●      PEST analysis included the following, at a minimum:

○     Political – federal legislation concerning efficient water usage, local by-law allowing cafés to expand their footpath dinning, or changes to the standard

○     Economic – gross regional product growth of 8.9%, number of visitors down 18%

○     Social – place for retirees, population growing

○     Technology – WiFi in café, an innovative frozen par-bake cooking system, federal government’s National Broadband Network (NBN).

●      SWOT analysis included the following, at a minimum:

○     Strengths – store on the corner of the two main streets of the city, innovative and popular range of rice wraps.

○     Weaknesses – the lack of sales promotion techniques, fit-out in parts looked old and unattractive

○     Opportunities – opportunities for opening more cafés in the surrounding shopping centres, local by-law allowing cafés to expand their footpath dining

○     Threats – international chain of coffee shops opening a store in the Parramatta CBD, legislation concerning efficient water usage.

In report, research risk that applies to the scope of risk management required for the scenario?

For example, included description of the source, primary/secondary data, of key information gathered:

●      site visit with James Mansfield – primary data: store operations (fit-out, cash handling, promotions, employment, water usage)

●      interview with Ron Langford – primary data: external environment (by-laws, government legislation, economic, expansion options, competition, technology plans)

●      extract from MacVille NSW – secondary data: key problems (problems with acquiring and re-branding existing stores)

●      any online research, council pages, google earth, local social media pages, etc., such as:

○     information from Parramatta regional council website – secondary data: economic indicators about the area (tourist numbers, unemployment, population growth, regional growth).

In the report, summarise the scenario risks?

The candidate should identify a number of risks, including, but not limited to, the following examples:

●      Human resources management risk:

○     no written policy and procedures manual and limited staff training – could lead to errors and inappropriate actions

○     authorisation system not clearly defined – could lead to fraud

○     lack of sales promotion techniques – impacts of the stores financial viability.

●      Financial operations risk:

○     no separation of duties – could lead to fraud

○     the banking was not done every day and was kept on the premises overnight without a safe – assets not protected could lead to theft

○     not all takings from the cash register by family staff members were recorded – unacceptable behaviour in
a company store and could lead to misappropriation
of funds.

●      WHS risk:

○     manager two-hour drive to and from weekly manager’s meeting – could lead to physical injury

○     unstable and broken chairs – customers injured; compliance breach and customer suing, loss of company reputation

○     carpet that was worn through was simply taped over with gaffer tape – compliance breach and customer suing, loss of company reputation

○     no established process for dealing with injuries happening at work – staff need a quick and organised response to injuries; staff work loss, unions suing, loss of company reputation.

●      Supply chain risk:

○     impractical to deliver fresh pastry from the company’s central bakery plant in timely manner – loss of company reputation, quality service loss

○     supply of company branded supplies – loss of brand recognition.

●      Local governance and compliance risk:

○     water use – company could be fined – loss of company reputation/brand recognition

○     incomplete employment records – unions could sue – government penalties – loss of company reputation/brand recognition, $50,000 fine

○     confidentially of records not guaranteed – privacy law breach.

●      Loss of brand recognition risk:

○     staff not wearing the company uniform, brand non-compliance

○     staff altering company processes and service expectations.

Use correct organisational naming convention for the report?

For example, in accordance with the document naming convention set out in the MacVille scenario:

 

‘Files should be saved using the document name, the date and the document version’.

Write an email for stakeholders to consult and invite participation?

Including:

●      addressed in appropriate style and convention to the stakeholders identified in report

●      a list of risks

●      invitation to participate in identifying and assessing risks.

In meeting with CEO, obtain support for risk management activities?

For example:

●      provide compelling reasons to the CEO for supporting the need for risk management

●      negotiates support for proposed risk management process.

In meeting with CEO, describe processes to consult with relevant stakeholders?

For example, in explaining possible consultation with Ron Langford, describe:

●      asking Ron about the likelihood of the trees being planted (to determine risk likelihood)

●      requesting information about how many parking spots will be lost (to determine risk consequence)

●      discuss consultation methods: phone call, email, face-to-face meeting.

In meeting with CEO, explain the MacVille risk management processes?

For example, describe the following process:

1.       Establish the context

2.       Identify and describe risks

3.       Conduct current risk analysis

4.       Conduct risk evaluation

5.       Treat risk

6.       Monitor, report and manage risks.

Include in CEO meeting notes an accurate summary of all discussions, including recommendations made by the CEO to the candidate in the context of the scenario?

Comments/feedback to participant

Outcome:CompetentNot Yet Competent
Assessor name:
Assessor signature:

Assessment 2 : Analyse and treat risk

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 Sydney 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:

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:
    1. For each risk (i.e. the four identified in the scenario for this task), assess the likelihood of the risk occurring.
    2. For each risk, assess the consequence of the risk occurring.
    3. 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).
    4. Once you have prioritised the risks, for each, outline at least two suitable options for treatment.
    5. 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:
      1. likely to be effective
      2. feasible for the organisation.

Note: Ensure your report is written in a style appropriate to your stakeholder audience

 

  1. Develop an action plan (you may use the Risk Management Action Plan template provided in Appendix 6 of this task) for implementing risk treatment and attach it to your report.
  2. 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.

Appendix 4: 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 submit a copy of your report to the CEO (your assessor) to table at the next Board mee

Appendix 5: Revised notes from previous meetings

Site visit – New Parramatta 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 Parramatta 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 Sydney. 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 Parramatta.
  • 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’.

Appendix 6: Risk management action plan template

RiskAssess risk
(score)
ControlsMonitoringAction priority
(1–5)
TimelinesResponsible

 

 

 

Marking Guide

Assessment Task 2: Analyse and treat risk

Outcomes

Did the candidate:Satisfactory
YesNo
Submit a risk analysis report, including a risk matrix?
Submit a completed risk management action plan?
Submit a plan showing how to implement one risk treatment?
Submit the deliverables in the agreed timeframe and format?

Performance indicators

Did the candidate:Satisfactory
YesNo
Include in their report discussion of the likelihood of risk occurring for each risk?

For example, assessed the likelihood of risk similar to the following:

●      banking risk: theft of cash left on premises – moderate

●      manager’s travel risk: physical injury – unlikely

●      by-law compliance risk: reputation/brand loss and fines – moderate

●      loss of brand recognition risk: not wearing the uniform – likely.

Include in their report discussion of the consequence of risk occurring for each risk?

For example, assessed the consequence of risk similar to the following:

●      banking risk: theft of cash left on premises – minor

●      manager’s travel risk: physical injury – extreme

●      by-law compliance risk: reputation/brand loss and fines – moderate

●      loss of brand recognition risk: not wearing the uniform – minor.

Include in their report discussion of priorities for treating the identified risks?

For example, prioritised the risks as follows:

●      banking risk: theft of cash left on premises – medium risk, #4 priority

●      manager’s travel risk: physical injury – high risk, #1 priority

●      by-law compliance risk: reputation/brand loss and fines – high risk, #2 priority

●      loss of brand recognition risk: brand non-compliance of staff not wearing the MacVille uniform, or altering MacVille processes and service expectations – high risk threshold, #3 priority.

Consequence

 

Likelihood

InsignificantMinorModerateMajorCatastrophic
Rare
UnlikelyManager
ModerateBankingWater
LikelyBrand
Almost certain
Include in their report discussion of at least two options for the treatment/control of each risk?  Options for treatment include :

●      Banking risk – theft of cash left on premises:

○     change banks to a closer

○     install a safe

○     take out insurance for cash on premises.

●      Manager’s travel risk – physical injury:

○     allow for overnight stay in Sydney

○     allow manager to fly instead of drive

○     finish the managers meeting early

○     allow the Parramatta to use video conferencing.

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

○     install a water tank for store use and change to native plants

○     introduce water saving devices – dual flush toilet, 5–6 star rated (WELS) dishwasher

○     change work practices – wash fruit and vegetables in still water, only run dishwasher when full, select economy cycle if only a light wash required

○     apply to the council for time to ‘make good’ as the new owners.

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

○     provide MacVille employee handbook to staff

○     hold a staff meeting prior to café launch to explain the importance of maintaining the MacVille brand

○     develop a warning system for instances of non-compliance.

Include in their report explanation of process used to identify risks and assess likelihood, consequence and priority?
Include in their report explanation of why options are effective and feasible for the organisation?
Use correct organisational naming convention for the report and
action plan? For example, in accordance with the document naming convention set out in the MacVille scenario: ‘Files should be saved using the document name, the date and the document version’
Submit a completed risk management action plan that included detail on risk assessment, controls, monitoring, priorities, timelines and responsibilities?
Implement a risk treatment option that is relevant to the risk and consistent with their action plan and/or with directives from the CEO?

Examples of implementation could include, but are not limited to:

●      developing a store policy/procedure related to wearing uniforms or maintaining brand consistency in café operations

●      giving a presentation to staff members (learners acting as staff members) about the importance of maintaining the MacVille brand

●      developing a MacVille reporting system and associated forms to report instances of non-compliance with uniform policy

●      emails delegating tasks to relevant staff members that relate to treating the loss of brand recognition risk.

Comments/feedback to participant

Outcome:CompetentNot Yet Competent
Assessor name:
Assessor signature:

Assessment Task 3:

Monitor risk and evaluate processes

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 required to review the implementation of the risk management action plan you developed in Assessment Task 2 and prepare a monitoring report.

Assessment description

For the MacVille Pty Ltd simulated business scenario provided, you are required to assume the role of Sydney 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:

For this task, you are to review the implementation of the risk management action plan you developed in Assessment Task 2 against the simulated business information provided in this task. Then, you will need to prepare a monitoring report evaluating the outcomes of the action plan and risk management process.

Procedure

  1. Review the MacVille simulated business scenario information provided in the Appendix of this task.
  2. Develop a report for the CEO (your assessor), which examines the ongoing implementation of the risk management action plan.
    1. Ensure you include the following sections in your report:
  1. Plan a clear summary of the initial risk and the plan implemented to manage it.
  2. Implementation – a summary of all actions taken to date in attempting to manage identified risks.
  • Outcomes – a clear statement identifying continued and/or reduced risks, with supporting information in tables or graphs where available.
  1. Evaluation – a clear analysis of the effectiveness of the risk management plan, including risk assessment (e.g. risk matrix), by comparing the implementation with the outcomes.

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.

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

Specifications

You must provide:

  • a monitoring report.

Your assessor will be looking for:

  • reading skills to review, interpret and analyse text-based business information from a range of sources in order to evaluate effectiveness of risk management implementation
  • written skills to organise and deliver information to effectively communicate evaluation of activities to stakeholders
  • numeracy skills to interpret mathematical data when reviewing and evaluating scenario business information effectiveness of activities
  • ability to work independently to analyse scenario information and evaluate effectiveness of activities
  • 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 effectiveness of activities
  • ability to use familiar digital technology to access information, document findings and communicate them to stakeholders.

Appendix 7: Scenario – MacVille Pty Ltd simulated business

Implementation information

It has now been six months since you delivered your risk management action plan. In accordance with the action plan, an external audit was completed and has been presented to the MacVille Board. The audit investigated the status of the planned actions on the risks identified.

 

A summary of the findings

  • The financial controller had taken out $5,000 on insurance cover for cash held on the premises overnight from the launch week as planned.
  • The company bank account that was planned to be opened in the first week was actually opened about four weeks after the café’s launch at the bank two doors down the street. As it is not MacVille’s regular bank, there are difficulties with getting the same level of service that MacVille stores receive in Sydney.
  • The teleconferencing system, planned for six months after launch, has not yet been installed, due in part to the delay in the rollout of the federal government’s National Broadband Network.
  • The weekly management meetings are finishing close to 3.00 pm as planned but sometimes the manager has to stay on at the request of the head office team. The manager has not yet been issued with an excusal letter by the CEO as agreed, and feels that they do not have the authority to just walk out at 3.00 pm.
  • The assistant manager training has been shifted to the mornings, allowing the manager to leave before 1.00 pm as planned.
  • The Board of Directors and CEO included a new policy regarding compliance with the Parramatta by-law on water conservation as planned, but the specific procedure has not yet been written. However, it appears that compliance is being achieved.
  • The plants have been changed to natives that require minimal water as planned. The installation of dual-flush toilets were planned for completion six months after settlement, and although the dual-flush toilets have been ordered and are in stock, they cannot be installed due to the backlog of work by district plumbers. The five-star rated (WELS) dishwasher was installed by the supplier within the six-month timetable as planned.
  • The application to ‘make good’ by Goldsmith Partners on behalf of MacVille was accepted by the Parramatta City Council; however, the grace period to comply with by-law ends in 14 days and the store is still above the acceptable benchmark for water use.
  • The training on daily banking appears to have been Competently completed as planned. An audit of the bank deposit book shows that there is no banking entry for the day’s sales on only two occasions in the past six months.
  • There has been one internal audit arranged by the store and, as planned, there should have been a call every two months. The store manager cites the distance that auditors have to travel and their overloaded work with the Sydney stores as the reason for this infrequency.
  • Although the training on the water-saving processes, as directed by the policy, has been verbally explained and followed, the written procedure has not been completed as the assistant manager (James Mansfield) claims to be too busy.
  • A water tank had been built in to the courtyard but the plumbing has not yet been connected. There is a weekly water-usage monitor in the staff room as planned but the information has not been updated for the past three weeks.
  • All the original staff members are wearing the MacVille uniform. However, these original employees are now responsible for directly supervising new employees. The original staff members are not explaining the uniform requirements to new employees and are not delivering any warnings for uniform non-compliance. As a result, there has been an increase in uniform non-compliance.

Marking Guide

Assessment Task 3: Monitor risk and evaluate processes

Outcomes

Did the candidate:Satisfactory
YesNo
Submit a completed written report?
Submit the deliverables in the agreed timeframe and format?

Performance indicators

Did the candidate:Satisfactory
YesNo
Include in their report discussion of their plan for managing risk?

Discussion of plan should include, but is not limited to:

●      Banking risk – theft of cash left on premises (initially rated as medium risk):

○     insurance on ‘cash on premises’

○     open an account with closest bank

○     policy and procedure requirement to bank daily.

●      Manager’s travel risk – physical injury (initially rated as extreme risk):

○     management meetings to finish 3.00 pm

○     install teleconferencing

○     management training shift to half-day morning sessions.

●      By-law compliance risk – reputation/brand loss and fines (initially rated as high risk):

○     apply for time to ‘make good’

○     policy and procedures to change work practices

○     install water saving devices such as native plants, tank, dual flush toilet systems, 5–6 star rated (WELS) dishwasher.

●      risk of decreased brand recognition– brand non-compliance (initially rated as high risk threshold):

○     provide MacVille Employee Handbook to staff

○     hold a staff meeting prior to café launch to explain the importance of maintaining the MacVille brand

○     develop a warnings system for instances of non-compliance.

Include in their report discussion of the implementation of their plan for managing risk including, but not limiting to:

●      Banking risk – theft of cash left on premises (initially rated as medium risk):

○     The financial controller had taken out $5,000 the insurance cover on cash held on premises overnight from the opening week as planned.

○     The company bank account was opened about four weeks after opening at the bank two shops down the street.

○     The training on daily banking has been Competently completed.

●      Manager’s travel risk – physical injury (initially rated as extreme risk):

○     The weekly management meetings are finishing close to 3:00 pm.

○     The assistant management training has been shifted to the mornings allowing the manager to leave before 1:00 pm.

●      By-law compliance risk – reputation/brand loss and fines (initially rated as high risk):

○     An external audit was completed and presented to the board six months after settlement.

○     The board and CEO included a new policy regarding compliance with the Parramatta by-law on water conservation.

○     The plants have been changed to natives.

○     The dual flush toilets are ordered and in stock.

○     The 5 star rated (WELS) dishwasher was installed.

○     The application to make-good by Goldsmith Partners on behalf of MacVille was accepted by the Parramatta City Council.

○     There has been one internal audit arranged by the store.

○     A water tank had been built in to the courtyard.

○     There is a weekly water usage monitor in the staff room.

●      Risk of decreased brand recognition– brand non-compliance (initially rated as high risk threshold):

○     Original Hurley’s staff members were provided with uniforms prior to MacVille launch

○     Warning system for uniform non-compliance is not being applied

Include in their report discussion of the outcomes of their implementation?

Discussion of outcomes should include, but is not limited to:

●      Banking risk – theft of cash left on premises (initially rated as medium risk):

○     now low risk due to insignificant consequence (insurance cover) and ‘unlikely’ likelihood because cash rarely kept on the premises.

●      Manager’s travel risk – physical injury (initially rated as high risk):

○     now considered potential high risk. Likelihood reduced to rare with the change in time travelled.

●      By-law compliance risk – reputation/brand loss and fines (initially rated as high risk):

○     now moderate risk due to unlikely likelihood with the installed water saving devices and processes.

●      Risk of decreased brand recognition – brand non-compliance of staff not wearing the MacVille uniform, or altering MacVille processes and service expectations (initially rated as high risk threshold):

o   now high risk due to increased likelihood of new hires not wearing the uniform and original staff not communicating the importance of upholding the MacVille brand.

Include in their report discussion of the evaluation of their risk management plan and risk assessment?

Discussion of evaluation should include, but is not limited to:

●      Banking risk – theft of cash left on premises (initially rated as moderate):

○     reduced to low risk; could be made more effective by 100% compliance with the daily banking directive and removal of expensive insurance on overnight cash on premises.

●      Manager’s travel risk – physical injury (initially rated as extreme):

○     reduced to high risk because of the continued travel; introduction of teleconferencing would reduce this risk to nil

○     CEO should provide an excusal letter to ensure the manager leaves at the appropriate time.

●      By-law compliance risk – reputation/brand loss and fines (initially rated as high):

○     reduced to moderate risk but could be reduced again to low risk by having Sydney plumbers install the tank and the dual-flush toilets in the next 14 days

○     monitor should be constantly updated to keep staff motivated and a procedure should be written. More internal audits are required.

●      Risk of decreased brand recognition – brand non-compliance of staff not wearing the MacVille uniform, or altering MacVille processes and service expectations (initially rated as high risk threshold):

○     increased to high risk

○     could be reduced by another presentation on brand importance to new hires and training of original staff in upholding MacVille systems and procedures.

Comments/feedback to participant

Outcome:CompetentNot Yet Competent
Assessor name:
Assessor signature:

 

ASSESSMENT COVER SHEET
Course NameBSB51915 Diploma of Leadership and Management
Unit Code and NameBSBRSK501 Manage Risks
Trainer/Assessor Name
Student ID:Student Name

 

 

 

 

Results

 

 

Individual Assessments

Results

Assessment 1C             NYC 

Final Result

C
Assessment 2C             NYC
NYC
Assessment 3C             NYC
Assessor SignatureDate
Feedback to student

 

 

 

I have received the assessment feedback on____________________ (Date)

Student Signature
Assessor Signature

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Assessment Schedule

 

Week NoAssessment NameTasks to CompleteTrainer/Assessor Comments
Week 1Assessment 1:

Report on risks

Start assessment task 1
Week 2Risk review report, including a completed table of stakeholders

Email to stakeholders

Due – Assessment 1

Week 3Assessment 2:

Analyse and treat risk

Start assessment task 2
Week 4Risk analysis report, including a risk matrix

Risk management action plan

Implement one risk treatment and submit evidence as agreed

Due – Assessment 2

Week 5Assessment 3:

Monitor risks and evaluate

Completed written report

Due – Assessment 3

Assessment 1: Report on risks

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 required to determine the risk context associated with establishing a new business outlet within the existing business structure. You will be required to review internal and external environment factors, obtain support for activities and liaise with relevant stakeholders to identify risks.

Assessment description

For the MacVille Pty Ltd simulated business scenario provided, you are required to assume the role of Sydney 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:

 

For this assessment task, you will need to review the simulated business’s risk management processes and determine the scope and objectives, taking into account stakeholders and both internal and external environmental factors affecting the organisation. Once you have gathered this information, you are to identify risks and write a draft report to the CEO.

 

You will meet with the CEO to discuss your report, seek support for your findings, and approval to communicate risk management processes to relevant stakeholders for their feedback and participation.

 

Procedure

You will assume the role of Ash, Assistant Manager of the Sydney MacVille café, who has just been promoted to Manager of the new Parramatta store. In preparation for the new venture, Ash has been tasked with conducting a risk management analysis of this project:

Excerpt of email from CEO Paula Kinski

From: CEO – P. Kinski

To: Assistant Manager – Church Street Store

Re: New Parramatta Store

Congratulations on your new appointment. Prior to taking up your position as Manager of our new Parramatta store, located in Church Street, the Board of Directors has asked that the risks in this project be appropriately managed.

 

I want you to undertake this task as it will give you significant insight into the store’s operations, it will ensure a smooth transition for Hurley’s Café staff into the MacVille family and will encourage you to give ongoing support for our risk management initiatives.

 

I would like you to approach this task in three stages and meet with me at the end of each phase to review your work and discuss your plans for the subsequent phases. The three stages in this risk management task will include:

1.       Review.

2.       Analyse and plan.

3.       Monitor.

Once I have received your risk review report, we will need to discuss the steps that you will take in the risk management process.

Regards

P. Kinski

CEO MacVille Cafés (NSW)

 

  1. Review the provided MacVille simulated business scenario information and documentation provided in the Appendices of this task.
  2. Write a report for the CEO (your assessor) that addresses the following:
    1. The effectiveness of the MacVille Risk Management Framework in supporting the principles and processes of risk management, set out in the risk management standard AS/NZS ISO 31000:2009. Outline the purpose and key elements of the standard in your discussion.
    2. Identify and describe the scope of risk management required in your role.
    3. Identify and describe the critical success factors, goals or objectives for areas included in the scope.
    4. Identify relevant internal and external stakeholders, their role in the risk management process, and any issues or concerns they have raised. Complete the Table of Stakeholders Template (provided in Appendix 3 of this task) and attach to your report.
    5. Complete a PEST analysis and a SWOT analysis to identify risks associated with the scenario. Outline the relevant legislation, regulations and standards (including those at a local level, i.e. Parramatta Council).
    6. Describe the methods of research that you used to complete your PEST and SWOT analysis. For example, how you approached the simulated business information; legislation, regulations, etc.; and any other information or research on risk that applies to the scope of your report.
    7. Complete the analysis of risk for the scenario by summarising the scenario and identifying a list of risks to the project.

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 summary.

  1. Submit your report as per the specifications on the next page. Be sure to keep a copy for your records.
  2. After you have developed your report, write a draft of an email that is intended for relevant stakeholders (identified in Step 2). Your email draft should clearly ask stakeholders for input, include a list of risks you have identified and invite them to assist in identifying any additional risks. Submit your draft email to your assessor as CEO along with the following in writing:
    1. your understanding of the critical success factors and goals
    2. Give the MacVille risk management process
    3. Explain in your document, how you can communicate with stakeholders about the risk management processes in this scenario and invite them to participate in discussions to further identify risks associated with the scenario
    4. obtain the CEO’s support for ongoing risk management activities
    5. ask the CEO for input on additional risks.
  3. Submit the required documents for assessment as per the specifications below. Be sure to keep a copy for your records.

Specifications

You must provide:

  • a risk review report, including a completed table of stakeholders
  • email communication to stakeholders

 

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
  • written and oral communication skills
  • numeracy skills to interpret mathematical data when reviewing and analysing scenario business information
  • ability to work independently as well as collaboratively to make decisions about risk management

 

 

  • 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 scope, goals and objectives and to evaluate options
  • ability to use familiar digital technology to access information, document findings and communicate them to stakeholders.

 

Appendix 1: MacVille Pty Ltd (simulated business)

Background

As part of their overall strategy in the Australian beverage market, MacVille Pty Ltd have developed a chain of cafés in the Central Business District (CBD) of Sydney, NSW. The Board of Directors has made the decision to expand their operations in Parramatta with the purchase and re-branding of the existing Hurley’s Café in Parramatta, the second largest CBD after Sydney CBD in NSW.

 

Ash is currently the Assistant Manager of MacVille’s flagship café in Sydney CBD, and has been given the opportunity to manage the new store in Parramatta. Ash is also a member of the Finance, Audit and Risk Management (FARM) Committee described in the MacVille Risk Management Policy.

 

The CEO for MacVille’s cafés, Paula Kinski, has assigned Ash the task of managing the risks involved with the operational aspects of this takeover. A copy of her email is provided below.

Email from CEO Paula Kinski

From: CEO – P. Kinski

To: Assistant Manager – Queen Street

Re: New Parramatta store

Congratulations on your new appointment. Prior to taking up your position as Manager of our new Parramatta store, located in Ruthven Street, the Board of Directors has asked that the risks in this project be appropriately managed.

 

I want you to undertake this task as it will give you significant insight into the store’s operations, it will ensure a smooth transition for Hurley’s Café staff into the MacVille family and will encourage you to give ongoing support for our risk management initiatives.

 

I would like you to approach this task in three stages. After the first stage, we will meet to review your work and discuss your plans for the subsequent phases. The three stages in this risk management task will include:

1.       Review.

2.       Analyse and plan.

3.       Monitor.

Your primary risk management focus is directed to the ongoing operations of the Parramatta café. The strategic and investment risks of this project are being managed by the Board. To this end, you are to consider any risks that could impact on human resources management, financial operations, WHS, our supply chain and the local governance and overall compliance issues.

 

MacVille has agreed to employ all existing staff at Hurley’s Café on three months’ probation. The current supervisor of Hurley’s, James Mansfield, has been offered the position of 2nd In Charge and he has accepted.

 

While settlement on the purchase of the business is not for another few weeks, the seller has agreed to grant us full access to the store’s operational processes and store information. You should liaise weekly with the Finance, Audit and Risk Management (FARM) Committee here at Sydney CBD concerning the marketing, finance and store management functions that you are investigating. I will set up a regular meeting for you.

 

Sydney CBD office has a report on expansion conducted by the internal office team that may help you in your research. You may need to review other statistical information and engage specialists to help you with your investigation. The legal firm Goldsmith Partners are advising MacVille on the Hurley’s Café acquisition and would be available to help you with legal or any compliance issues.

The landlord of the shop in Parramatta, Ron Langford, is also a local councillor and has offered his assistance in getting established in Parramatta. He has offered his availability for email address for correspondence.

 

When you have finished your report, please name it according to our document naming conventions and send it through. Once I have received and discussed your risk review report, we can move onto the next stage of the risk management process.

 

Regards

 

P. Kinski

CEO MacVille Cafés (NSW)

MacVille document naming convention

Files should be saved using the document name, the date and the document version. For example, a meeting agenda for a meeting on 1 March 2014 would be saved as ‘Meeting Agenda 01032014 v1’.

 

Site visit – New Parramatta store (the existing Hurley’s Café)

You received permission from Paula to travel to the Parramatta store to start your research. Paula had cleared it with James Mansfield, the current senior supervisor, who will spend most of the day with you helping answer your queries. She also arranged for you to spend time with Ron Langford, the store’s landlord.

Meeting with James Mansfield

You arrived at the café and noted the 45 minutes drive time that it took to get there from the CBD of Sydney in business hours. You met with James, who took you through a complete overview of the store and the surrounding area. He was OK with the idea that you needed to take notes in preparation for a report. After lunch, you went over your notes to revise and edit key concerns and significant events that you had written down earlier:

Notes from meeting with James Mansfield
●      The location of the store on the corner of the two main streets of Parramatta makes for easy access for local customers and high visibility for tourists.

●      The drive from Parramatta to Sydney would make attending the weekly managers meeting difficult considering many meetings did not finish until into the evening after refreshments. There are also manager training sessions that need to be completed over the next six months in with a few other assistant managers. Navigating through the heavy traffic is difficult even in daylight hours. Being a competent driver you feel that it would be unlikely that you would be involved in an accident, but it still concerns you considerably.

●      The two-hour delivery time would make fresh pastry deliveries from the company’s central bakery plant impractical. The pastries would arrive after the morning rush. These are a key part of the MacVille product assortment.

●      There is also a concern about getting the company-branded supplies through as quickly as a CBD Sydney store could.

●      Hurley’s Café was a family-run store and some family members were employed on the staff. James was engaged by the family to supervise the operations of the store and Mr Hurley as manager would authorise wages but anyone can authorise deliveries.

●      When asked about written policy and procedures manual, James said that Mr Hurley set the policy and procedures verbally and on the few days each week he was in the store he would show the staff how to do things the way he wanted them done.

●      Water use – Water wastage present; the dishwasher is often run when only half full; fruit and vegetables are washed under a fast-running tap; toilets all use the single flush system; James explained that Mr Hurley instructed the staff to keep the non-native flowering plants in the courtyard fully watered.

○     The dishwasher was always set to the full wash setting and has a Water Efficiency Labelling and Standards Scheme (WELS) rating of 3. The more water efficient 5–6 star dishwashers cost about $6,000 and above.

○     Dual-flush system would cost about $7,500 to upgrade.

The store currently uses 41,500 litres a week.

●      James spoke about the café attracting a large percentage of retirees because of the easy access to buses and the store’s central location.

●      The same staff member that completed the cash register balancing also completed the bank deposit form and did the banking as well. The banking was not done every day and often $4,000 was kept on the premises overnight in the cash register. There was no safe. There is a bank two shops away but the Hurley family bank is a couple of blocks away and there was not always time to do the banking.

●      James replied to your question about the possibility of break-ins, saying that there was a 50% chance of it happening in a year and the consequence was moderate.

●      Not all takings from the cash register by family staff members were recorded.

●      The fit-out looked old and unattractive in parts, with some chairs unstable and broken and some parts of the worn carpet were simply taped over with gaffer tape.

●      One of the staff was a qualified chef who had developed an innovative and popular range of rice wraps that were tasty, gourmet and healthy. None of the other cafés in the area offered these.

●      No established process for dealing with injuries that happened at work.

●      James gave a brochure about an innovative frozen par-bake cooking system that was under the limit set by council for an exhaust system, yet it cooked fresh bakery items in 30 minutes from frozen par-baked pastries.

●      The computer with all the store’s employee details, and financial records was not password protected and anyone could access the information.

●      James’s response to your question about the lack of sales promotion techniques was that he could not get the staff interested in the activity so he stopped trying to make it happen.

●      The employee detail form requested information about the employee’s entire past health issues.

●      The wage and superannuation records seemed to be incomplete, with many calculations being worked out by the number of hours worked multiplied by a set ‘in the hand’ amount.

●      James also provided a brochure about a company that could come and set up WiFi in the café so that customers could use their computer notebooks and connect to the internet while they were dining in the café.

Meeting with Ron Langford

You met with Ron Langford in his office to discuss the café, council by-laws and aspects concerning the surrounding district. You took notes that included the following significant information.

Notes from meeting with Ron Langford
●      Ron explained that there were opportunities for opening more cafés in the surrounding shopping centres like Westfield and Parramatta Shopping Centre on George Street.

●      Ron handed you an extract from a government report, ‘Economic Brief’.

●      Ron explained that the federal government was now introducing legislation that backs up the local by-law concerning efficient water usage, particularly by industries. The current by-law has fines of up to $50,000 for excessive water breaches. Ron did explain that the council was allowing some time to ‘make good’ under certain circumstances on a case-by-case basis. Ron also agreed with the idea of installing a water tank in the courtyard for the café to use and would help get it built.

●      Ron explained that Parramatta was obviously a place for business growth and the population was growing.

●      Ron spoke about the federal government’s National Broadband Network in Parramatta, which would allow efficient and effective video streaming and teleconferencing.

●      Ron spoke about a current by-law that allows cafés to expand their footpath dining and so put more tables and chairs outside their premises.

●      Ron also spoke of the fact that representatives of a large international chain of coffee shops had been making enquiries around about opening a store in the Parramatta CBD.

 

Meetings with Senior Management Team and Finance, Audit and Risk Management (FARM) Committee

Soon after you returned from your research trip to the Parramatta store, you attended two teleconferences.

First teleconference

First, you met with the senior management team. At this teleconference, you discussed issues raised by James Mansfield and Ron Langford and the report on previous NSW expansion, which Sydney CBD office had given you: Report into the acquisition and re-branding of the NSW expansion store. Paula said that there may be some things to learn from the report.

Key problems identified in the report were as follows:

  1. Lack of internal controls, particularly over cash handling, monitoring and recording.
  2. Failure to meet compliance standards in WHS, privacy and industrial relations law.
  3. Lack of written policy and procedures to guide staff in carrying out their duties.
  4. Lack of a professional business culture in the family run business.
  5. Failure of the business to monitor the external environment and find opportunities and threats to the business.

The team agreed that similar issues would pose a risk to the Parramatta expansion.

 

Second teleconference

You then held a teleconference with the FARM Committee. At the teleconference, you relayed the concerns of the senior management team. The FARM Committee decided to allow you time to complete your review and then would include discussion of your review in the monthly Board of Directors meeting.

 

Appendix 2: MacVille Pty Ltd – Business plan (excerpt)

 

MacVille Pty Ltd: Risk management policy

Introduction

MacVille recognises that risk management is an essential component of good management practice and is committed to ensuring the implementation of risk management processes that focus on the proactive management of risks across the organisation.

This risk management policy forms part of MacVille’s internal controls and corporate governance arrangements. The risk management policy is designed to:

  • identify, evaluate, control and manage risks
  • ensure potential threats and opportunities are identified and managed
  • inform directors, senior management and staff members about their roles, responsibilities and reporting procedures with regards to risk management
  • ensure risk management is an integral part of planning at all levels of the organisation.

Policy

MacVille is committed to achieving its vision, business objectives and quality objectives by the proactive management of risk at all levels of the organisation.

MacVille will identify, evaluate, control and manage risk throughout the organisation in accordance with the ‘MacVille Risk Management Framework’. See risk management strategy for framework details.

Responsibility and Authority

Directors, management and employees of MacVille have responsibility for implementing aspects of this policy.

Role of the Directors

The Directors have a governance responsibility in the management of risk. This includes:

  • determining which types of risk are acceptable and which are not
  • setting the standards and expectations of staff with respect to conduct
  • approving major decisions affecting MacVille’s risk profile or exposure
  • monitoring the management of significant risks to reduce the likelihood of potential organisational risks and threats or failure
  • being satisfied that risks are being actively managed, with the appropriate controls in place and working effectively
  • annual review of MacVille’s approach to risk management and approval of changes or improvements to key elements of its processes and procedures.

Role of the Senior Management Team and Store Managers

Key roles of the senior management team are to:

  • implement policies on risk management and internal control where this is deemed appropriate
  • identify and evaluate areas of significant risks potentially faced by MacVille for consideration by the Directors
  • identify areas where risk management is not adequately addressed and advise the Directors accordingly
  • review and update the Risk Management Strategy

 

  • undertake an annual review of the effectiveness of systems of internal control and provide an annual report to the Directors, including a summary review and respective recommendations.

Role of Café Employees

Key roles of employees are to:

  • familiarise themselves with the content of the Risk Management Policy and clarify any aspects necessary with a senior team member
  • consider any risks they feel could impact on them meeting their objectives and either manage the risk if it is in their control to do so, or inform a management team member of their concerns
  • advise senior management, in the first instance, or the Board of Directors, if concerned about any fraud or unethical behaviour.

 

MacVille Risk Management Framework

This framework encompasses a number of elements that together facilitate an effective and efficient operation, enabling MacVille to respond to a variety of operational, financial, commercial and strategic risks. These elements include:

  • policies and procedures
  • monthly reporting
  • business planning and budgeting
  • risk management review
  • external audit.

Policies and procedures

A series of policies underpin the internal control process. These policies are endorsed by the directors and are implemented and communicated by the senior management team to all staff. These policies include:

  • Human Resources Policies:
    • Staff Travel Policy
    • Harassment Policy
    • WHS Policy
    • Return to Work Policy
    • Work–Life Balance Policy
    • Equity/Discrimination/Diversity Policy
    • Parental Leave Policy
    • Organisational Culture Policy
  • Financial Policies:
    • Bad Debt Policy
    • Cash Reserving Policy
    • Revenue/Expenditure Recognition Policy
    • Finance, Audit and Risk Management (FARM) Committee Terms of Reference, including delegations
  • Corporate Governance Policies:
    • Board Protocol
    • Sitting Fees Policy
    • Directors Remuneration Policy.

Monthly reporting

Decisions to rectify problems are made at regular meetings of the senior management team. Comprehensive reporting at Board and Sub-committee meetings is designed to monitor key risks and their controls.

Business planning and budgeting

The business planning and budgeting process is used to set objectives, agree on action plans, and allocate resources. Progress towards meeting business plan objectives is monitored regularly by the senior management team and by Directors at Board meetings.

Risk management review

The Finance, Audit and Risk Management (FARM) Committee is required to report at Board meetings on internal controls. The FARM Committee pays particular attention to risk management. It is the CEO’s responsibility to brief the Directors periodically and as appropriate on the development of policies and procedures to ensure effective and efficient operations, risk management strategies and implementation. In addition, the FARM Committee oversees internal audit, external audit and management as required in its review of internal controls. The committee is therefore well placed to provide advice to the Board on the effectiveness of the internal control system, including MacVille’s strategy for the management of risk.

External audit

The final audit of financial statements is controlled by an external chartered accountant who provides feedback to the Board through the FARM Committee.

 

Procedure: Development of a Risk Management Profile

The following outlines the process for developing a risk management profile.

1. Establish the context:

  • Define and identify the environment, characteristics and stakeholders, their goals and objectives, and the scope of the specific risk management process.
  • Develop criteria against which risks are evaluated and identify the structure for risk management.

2. Identify and describe risks:

  • Risks are best identified through a collaborative approach involving a cross-section of stakeholders.
  • All conceivable risks must be considered. Ensure any certainties are identified as problems and addressed in the risk management profile.

3. Conduct current risk analysis:

  • An analysis of the risks is conducted to determine their causes, and estimate their probability and consequences. This analysis provides the basis for working on the ‘right’ risks.

4. Conduct risk evaluation:

  • Risks are considered and prioritised according to their potential impact, and each risk is assessed to determine its level of acceptability.

5. Develop and implement proposed risk treatments:

  • Risk treatments are developed to cost-effectively reduce, contain and control risk.
  • Formal risk management reporting mechanisms are defined and documented.
  • Categorise the risk likelihood.

6. Monitor, report, update and manage risks:

  • As risks change constantly, the risk profile is continuously monitored, reviewed and updated by management. New risks may be identified as more information becomes available and existing risks may be eliminated through the effectiveness of the risk treatments/actions.
  • Identified risks, and monitoring and management activities should be recorded and stored as follows:
    • risks identified through regular audit should be recorded on the Risk Audit Log
    • risk management activities should be recorded on the Risk Management Register.

MacVille’s Risk Areas

The following are four broad areas where potential for risk to MacVille has been identified. Under each area, examples of possible risks are detailed.

Operational/organisational:

  • legal and regulatory compliance
  • technology
  • insurance
  • resources: human, physical
  • logistics
  • marketing
  • product quality
  • communications
  • infrastructure, plant and equipment
  • customer interaction
  • market needs.

Financial:

  • accountability
  • fraud or theft
  • capital investment

 

  • interest rates
  • loss of income, funding/finance.

Governance:

  • conduct of Board of Directors
  • conflict of interest.

Project management:

  • procedures and tools for project management
  • stakeholders – strength of relationships/conflict of interest
  • human resources
  • financial resources.

MacVille Pty Ltd: Risk management strategy

Introduction

MacVille recognises that risk management is an essential component of good management practice and is committed to the proactive management of risks across the organisation. The strategy is designed to:

  • identify, evaluate, control and manage risks
  • ensure potential threats and opportunities are identified and managed
  • inform directors, senior management and staff members about their roles, responsibilities and reporting procedures with regards to risk management
  • ensure risk management is an integral part of planning at all levels of the organisation.

Guiding Principles

  • MacVille is committed to achieving its vision, business objectives and quality objectives by the proactive management of risk at all levels of the organisation, acknowledging that embracing innovative ideas and practices carries with it risks, but that these are identifiable and measurable and therefore capable of being subject to realistic risk mitigation processes.

Responsibility and Authority

  • The Board of Directors have responsibility for ensuring that risk management is in place.
  • The Finance, Audit and Risk Management (FARM) Committee has the responsibility of reviewing the Risk Management Action Plan on a six-monthly basis.
  • The CEO and the senior management team have responsibility for managing risk and advising the Board on appropriate controls.
  • The CEO and the senior management team support and implement policies approved by the directors.
  • Key risk indicators will be identified, closely monitored and action taken where necessary, by the staff and directors.

MacVille Risk Management Framework

This framework encompasses a number of elements that together facilitate an effective and efficient operation, enabling MacVille to respond to a variety of operational, financial, commercial and strategic risks. These elements include:

  • Policies and procedures: A series of policies underpin the internal control process.
  • Reporting: Decisions to rectify problems are made at regular meetings of the senior management team.
  • Business planning and budgeting: The business planning and budgeting process is used to set objectives, agree on action plans and allocate resources. Progress towards meeting business plan objectives is monitored regularly by the senior management team and by directors at Board meetings. Contingency planning is undertaken as required.
  • Risk management review: The FARM Committee is required to report at Board meetings on internal controls.
  • CEO: The CEO has responsibility to brief the Directors periodically and as appropriate on the development of policies and procedures to ensure effective and efficient operations, risk management strategies and implementation.
  • External audit: The final audit of financial statements is controlled by an external chartered accountant who provides feedback to the Board through the FARM Committee.

Definitions

Risks are identified on a scale of likelihood of occurring in the next 12 months and assigning an impact or consequence to the risk as high, medium or low. High includes either a significant shortfall of around 40% in achieving budget or a significant reduction in ability to function. Medium includes either a shortfall of budget of between 10% and 20% or some reduction in function. Low indicates minor reductions in achieving budget or minimal reduction in performance.

 

Appendix 3: Table of stakeholders template

StakeholderInternal/externalRole in processStake in process
    
    
    

 

 

Marking Guide

Assessment 1: Report on risks

Outcomes

Did the candidate:Satisfactory
YesNo
Submit a risk review report, including a completed Table of Stakeholders?
Submit a draft email communication to stakeholders?
Submit the deliverables in the agreed timeframe and format?

Performance indicators

Did the candidate:Satisfactory
YesNo
Discuss in their report how effective MacVille’s Risk Management Framework is in supporting the principles and processes of risk management set out in AS/NZS ISO 31000:2009 Risk management – principles and guidelines, outlining the purpose and key elements of the standard?

For example, they included discussion that the standard:

●      provides guidance to enable public, private or community enterprises, groups or individuals to manage risk, which can allow:

○     increased likelihood of achieving objectives

○     encourage proactive management

○     promote organisational awareness of risk, etc.

●      views the analysis and evaluation of risk as two separate elements

●      outlines seven elements in the risk management process:

1.     Establish the context

2.     Identify risks

3.     Analyse risks

4.     Evaluate risks

5.     Treat risks

6.     Monitor and review

7.     Communicate and consult.

For example, identifying the effectiveness of the MacVille framework in supporting the standard may include, but is not limited to:

●      the MacVille framework recognises that risk management should be integral to all organisational processes

●      the steps in the procedure reflect the process set out by the standard

●      MacVille’s framework could be improved by including more explicit requirements for communication and consultation with stakeholders.

In the report, identify and describe the scope – covering at least the following:

●      Project – MacVille to expand their operations in Parramatta and purchase and rebrand an existing café in Parramatta.

●      Business unit – MacVille cafés Sydney, NSW

●      Risk in relation to business functions – human resources management, financial operations, WHS, supply chain, local governance and compliance issues, loss of brand recognition?

In the report, identify and describe goals – should include some of the following:

●      to appropriately manage the risks involved with the operation of the Parramatta store

●      to give the new manager significant insights into the store’s operations

●      to ensure there is a smooth transition to the MacVille systems

●      to encourage the new manager to give ongoing support for risk management?

Identify relevant internal and external stakeholders and their roles in the risk management process?

For examples, see the Stakeholder Feedback Table that follows this Marking Guide table. This list includes possible stakeholders, and is not exhaustive.

Identify risks associated with the analysis using tools, such as PEST and SWOT analyses?

For example:

●      PEST analysis included the following, at a minimum:

○     Political – federal legislation concerning efficient water usage, local by-law allowing cafés to expand their footpath dinning, or changes to the standard

○     Economic – gross regional product growth of 8.9%, number of visitors down 18%

○     Social – place for retirees, population growing

○     Technology – WiFi in café, an innovative frozen par-bake cooking system, federal government’s National Broadband Network (NBN).

●      SWOT analysis included the following, at a minimum:

○     Strengths – store on the corner of the two main streets of the city, innovative and popular range of rice wraps.

○     Weaknesses – the lack of sales promotion techniques, fit-out in parts looked old and unattractive

○     Opportunities – opportunities for opening more cafés in the surrounding shopping centres, local by-law allowing cafés to expand their footpath dining

○     Threats – international chain of coffee shops opening a store in the Parramatta CBD, legislation concerning efficient water usage.

In report, research risk that applies to the scope of risk management required for the scenario?

For example, included description of the source, primary/secondary data, of key information gathered:

●      site visit with James Mansfield – primary data: store operations (fit-out, cash handling, promotions, employment, water usage)

●      interview with Ron Langford – primary data: external environment (by-laws, government legislation, economic, expansion options, competition, technology plans)

●      extract from MacVille NSW – secondary data: key problems (problems with acquiring and re-branding existing stores)

●      any online research, council pages, google earth, local social media pages, etc., such as:

○     information from Parramatta regional council website – secondary data: economic indicators about the area (tourist numbers, unemployment, population growth, regional growth).

In the report, summarise the scenario risks?

The candidate should identify a number of risks, including, but not limited to, the following examples:

●      Human resources management risk:

○     no written policy and procedures manual and limited staff training – could lead to errors and inappropriate actions

○     authorisation system not clearly defined – could lead to fraud

○     lack of sales promotion techniques – impacts of the stores financial viability.

●      Financial operations risk:

○     no separation of duties – could lead to fraud

○     the banking was not done every day and was kept on the premises overnight without a safe – assets not protected could lead to theft

○     not all takings from the cash register by family staff members were recorded – unacceptable behaviour in
a company store and could lead to misappropriation
of funds.

●      WHS risk:

○     manager two-hour drive to and from weekly manager’s meeting – could lead to physical injury

○     unstable and broken chairs – customers injured; compliance breach and customer suing, loss of company reputation

○     carpet that was worn through was simply taped over with gaffer tape – compliance breach and customer suing, loss of company reputation

○     no established process for dealing with injuries happening at work – staff need a quick and organised response to injuries; staff work loss, unions suing, loss of company reputation.

●      Supply chain risk:

○     impractical to deliver fresh pastry from the company’s central bakery plant in timely manner – loss of company reputation, quality service loss

○     supply of company branded supplies – loss of brand recognition.

●      Local governance and compliance risk:

○     water use – company could be fined – loss of company reputation/brand recognition

○     incomplete employment records – unions could sue – government penalties – loss of company reputation/brand recognition, $50,000 fine

○     confidentially of records not guaranteed – privacy law breach.

●      Loss of brand recognition risk:

○     staff not wearing the company uniform, brand non-compliance

○     staff altering company processes and service expectations.

Use correct organisational naming convention for the report?

For example, in accordance with the document naming convention set out in the MacVille scenario:

 

‘Files should be saved using the document name, the date and the document version’.

Write an email for stakeholders to consult and invite participation?

Including:

●      addressed in appropriate style and convention to the stakeholders identified in report

●      a list of risks

●      invitation to participate in identifying and assessing risks.

In meeting with CEO, obtain support for risk management activities?

For example:

●      provide compelling reasons to the CEO for supporting the need for risk management

●      negotiates support for proposed risk management process.

In meeting with CEO, describe processes to consult with relevant stakeholders?

For example, in explaining possible consultation with Ron Langford, describe:

●      asking Ron about the likelihood of the trees being planted (to determine risk likelihood)

●      requesting information about how many parking spots will be lost (to determine risk consequence)

●      discuss consultation methods: phone call, email, face-to-face meeting.

In meeting with CEO, explain the MacVille risk management processes?

For example, describe the following process:

1.       Establish the context

2.       Identify and describe risks

3.       Conduct current risk analysis

4.       Conduct risk evaluation

5.       Treat risk

6.       Monitor, report and manage risks.

Include in CEO meeting notes an accurate summary of all discussions, including recommendations made by the CEO to the candidate in the context of the scenario?

Comments/feedback to participant

 

Outcome:CompetentNot Yet Competent
Assessor name:
Assessor signature:

 

 

Assessment 2 : Analyse and treat risk

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 Sydney 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:

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:
    1. For each risk (i.e. the four identified in the scenario for this task), assess the likelihood of the risk occurring.
    2. For each risk, assess the consequence of the risk occurring.
    3. 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).
    4. Once you have prioritised the risks, for each, outline at least two suitable options for treatment.
    5. 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:
      1. likely to be effective
      2. feasible for the organisation.

Note: Ensure your report is written in a style appropriate to your stakeholder audience

  1. Develop an action plan (you may use the Risk Management Action Plan template provided in Appendix 6 of this task) for implementing risk treatment and attach it to your report.
  2. 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.

Appendix 4: 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 submit a copy of your report to the CEO (your assessor) to table at the next Board meeting.

 

Appendix 5: Revised notes from previous meetings

Site visit – New Parramatta 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 Parramatta 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 Sydney. 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 Parramatta.
  • 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’.

 

Appendix 6: Risk management action plan template

RiskAssess risk
(score)
ControlsMonitoringAction priority
(1–5)
TimelinesResponsible

 

 

 

Marking Guide

Assessment Task 2: Analyse and treat risk

Outcomes

Did the candidate:Satisfactory
YesNo
Submit a risk analysis report, including a risk matrix?
Submit a completed risk management action plan?
Submit a plan showing how to implement one risk treatment?
Submit the deliverables in the agreed timeframe and format?

 Performance indicators

Did the candidate:Satisfactory
YesNo
Include in their report discussion of the likelihood of risk occurring for each risk?

For example, assessed the likelihood of risk similar to the following:

●      banking risk: theft of cash left on premises – moderate

●      manager’s travel risk: physical injury – unlikely

●      by-law compliance risk: reputation/brand loss and fines – moderate

●      loss of brand recognition risk: not wearing the uniform – likely.

Include in their report discussion of the consequence of risk occurring for each risk?

For example, assessed the consequence of risk similar to the following:

●      banking risk: theft of cash left on premises – minor

●      manager’s travel risk: physical injury – extreme

●      by-law compliance risk: reputation/brand loss and fines – moderate

●      loss of brand recognition risk: not wearing the uniform – minor.

Include in their report discussion of priorities for treating the identified risks?

For example, prioritised the risks as follows:

●      banking risk: theft of cash left on premises – medium risk, #4 priority

●      manager’s travel risk: physical injury – high risk, #1 priority

●      by-law compliance risk: reputation/brand loss and fines – high risk, #2 priority

●      loss of brand recognition risk: brand non-compliance of staff not wearing the MacVille uniform, or altering MacVille processes and service expectations – high risk threshold, #3 priority.

Consequence

 

Likelihood

InsignificantMinorModerateMajorCatastrophic
Rare
UnlikelyManager
ModerateBankingWater
LikelyBrand
Almost certain
Include in their report discussion of at least two options for the treatment/control of each risk?  Options for treatment include :

●      Banking risk – theft of cash left on premises:

○     change banks to a closer

○     install a safe

○     take out insurance for cash on premises.

●      Manager’s travel risk – physical injury:

○     allow for overnight stay in Sydney

○     allow manager to fly instead of drive

○     finish the managers meeting early

○     allow the Parramatta to use video conferencing.

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

○     install a water tank for store use and change to native plants

○     introduce water saving devices – dual flush toilet, 5–6 star rated (WELS) dishwasher

○     change work practices – wash fruit and vegetables in still water, only run dishwasher when full, select economy cycle if only a light wash required

○     apply to the council for time to ‘make good’ as the new owners.

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

○     provide MacVille employee handbook to staff

○     hold a staff meeting prior to café launch to explain the importance of maintaining the MacVille brand

○     develop a warning system for instances of non-compliance.

Include in their report explanation of process used to identify risks and assess likelihood, consequence and priority?
Include in their report explanation of why options are effective and feasible for the organisation?
Use correct organisational naming convention for the report and
action plan? For example, in accordance with the document naming convention set out in the MacVille scenario: ‘Files should be saved using the document name, the date and the document version’
Submit a completed risk management action plan that included detail on risk assessment, controls, monitoring, priorities, timelines and responsibilities?
Implement a risk treatment option that is relevant to the risk and consistent with their action plan and/or with directives from the CEO?

Examples of implementation could include, but are not limited to:

●      developing a store policy/procedure related to wearing uniforms or maintaining brand consistency in café operations

●      giving a presentation to staff members (learners acting as staff members) about the importance of maintaining the MacVille brand

●      developing a MacVille reporting system and associated forms to report instances of non-compliance with uniform policy

●      emails delegating tasks to relevant staff members that relate to treating the loss of brand recognition risk.

Comments/feedback to participant

Outcome:CompetentNot Yet Competent
Assessor name:
Assessor signature:

 

Assessment Task 3:

Monitor risk and evaluate processes

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 required to review the implementation of the risk management action plan you developed in Assessment Task 2 and prepare a monitoring report.

Assessment description

For the MacVille Pty Ltd simulated business scenario provided, you are required to assume the role of Sydney 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:

For this task, you are to review the implementation of the risk management action plan you developed in Assessment Task 2 against the simulated business information provided in this task. Then, you will need to prepare a monitoring report evaluating the outcomes of the action plan and risk management process.

Procedure

  1. Review the MacVille simulated business scenario information provided in the Appendix of this task.
  2. Develop a report for the CEO (your assessor), which examines the ongoing implementation of the risk management action plan.
    1. Ensure you include the following sections in your report:
  1. Plan a clear summary of the initial risk and the plan implemented to manage it.
  2. Implementation – a summary of all actions taken to date in attempting to manage identified risks.
  • Outcomes – a clear statement identifying continued and/or reduced risks, with supporting information in tables or graphs where available.
  1. Evaluation – a clear analysis of the effectiveness of the risk management plan, including risk assessment (e.g. risk matrix), by comparing the implementation with the outcomes.

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.

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

 

Specifications

You must provide:

  • a monitoring report.

 

Your assessor will be looking for:

  • reading skills to review, interpret and analyse text-based business information from a range of sources in order to evaluate effectiveness of risk management implementation
  • written skills to organise and deliver information to effectively communicate evaluation of activities to stakeholders
  • numeracy skills to interpret mathematical data when reviewing and evaluating scenario business information effectiveness of activities
  • ability to work independently to analyse scenario information and evaluate effectiveness of activities
  • 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 effectiveness of activities
  • ability to use familiar digital technology to access information, document findings and communicate them to stakeholders.

 

 

Appendix 7: Scenario – MacVille Pty Ltd simulated business

Implementation information

It has now been six months since you delivered your risk management action plan. In accordance with the action plan, an external audit was completed and has been presented to the MacVille Board. The audit investigated the status of the planned actions on the risks identified.

 

A summary of the findings

  • The financial controller had taken out $5,000 on insurance cover for cash held on the premises overnight from the launch week as planned.
  • The company bank account that was planned to be opened in the first week was actually opened about four weeks after the café’s launch at the bank two doors down the street. As it is not MacVille’s regular bank, there are difficulties with getting the same level of service that MacVille stores receive in Sydney.
  • The teleconferencing system, planned for six months after launch, has not yet been installed, due in part to the delay in the rollout of the federal government’s National Broadband Network.
  • The weekly management meetings are finishing close to 3.00 pm as planned but sometimes the manager has to stay on at the request of the head office team. The manager has not yet been issued with an excusal letter by the CEO as agreed, and feels that they do not have the authority to just walk out at 3.00 pm.
  • The assistant manager training has been shifted to the mornings, allowing the manager to leave before 1.00 pm as planned.
  • The Board of Directors and CEO included a new policy regarding compliance with the Parramatta by-law on water conservation as planned, but the specific procedure has not yet been written. However, it appears that compliance is being achieved.
  • The plants have been changed to natives that require minimal water as planned. The installation of dual-flush toilets were planned for completion six months after settlement, and although the dual-flush toilets have been ordered and are in stock, they cannot be installed due to the backlog of work by district plumbers. The five-star rated (WELS) dishwasher was installed by the supplier within the six-month timetable as planned.
  • The application to ‘make good’ by Goldsmith Partners on behalf of MacVille was accepted by the Parramatta City Council; however, the grace period to comply with by-law ends in 14 days and the store is still above the acceptable benchmark for water use.
  • The training on daily banking appears to have been Competently completed as planned. An audit of the bank deposit book shows that there is no banking entry for the day’s sales on only two occasions in the past six months.
  • There has been one internal audit arranged by the store and, as planned, there should have been a call every two months. The store manager cites the distance that auditors have to travel and their overloaded work with the Sydney stores as the reason for this infrequency.
  • Although the training on the water-saving processes, as directed by the policy, has been verbally explained and followed, the written procedure has not been completed as the assistant manager (James Mansfield) claims to be too busy.
  • A water tank had been built in to the courtyard but the plumbing has not yet been connected. There is a weekly water-usage monitor in the staff room as planned but the information has not been updated for the past three weeks.
  • All the original staff members are wearing the MacVille uniform. However, these original employees are now responsible for directly supervising new employees. The original staff members are not explaining the uniform requirements to new employees and are not delivering any warnings for uniform non-compliance. As a result, there has been an increase in uniform non-compliance.

Marking Guide

Assessment Task 3: Monitor risk and evaluate processes

Outcomes

Did the candidate:Satisfactory
YesNo
Submit a completed written report?
Submit the deliverables in the agreed timeframe and format?

Performance indicators

Did the candidate:Satisfactory
YesNo
Include in their report discussion of their plan for managing risk?

Discussion of plan should include, but is not limited to:

●      Banking risk – theft of cash left on premises (initially rated as medium risk):

○     insurance on ‘cash on premises’

○     open an account with closest bank

○     policy and procedure requirement to bank daily.

●      Manager’s travel risk – physical injury (initially rated as extreme risk):

○     management meetings to finish 3.00 pm

○     install teleconferencing

○     management training shift to half-day morning sessions.

●      By-law compliance risk – reputation/brand loss and fines (initially rated as high risk):

○     apply for time to ‘make good’

○     policy and procedures to change work practices

○     install water saving devices such as native plants, tank, dual flush toilet systems, 5–6 star rated (WELS) dishwasher.

●      risk of decreased brand recognition– brand non-compliance (initially rated as high risk threshold):

○     provide MacVille Employee Handbook to staff

○     hold a staff meeting prior to café launch to explain the importance of maintaining the MacVille brand

○     develop a warnings system for instances of non-compliance.

Include in their report discussion of the implementation of their plan for managing risk including, but not limiting to:

●      Banking risk – theft of cash left on premises (initially rated as medium risk):

○     The financial controller had taken out $5,000 the insurance cover on cash held on premises overnight from the opening week as planned.

○     The company bank account was opened about four weeks after opening at the bank two shops down the street.

○     The training on daily banking has been Competently completed.

●      Manager’s travel risk – physical injury (initially rated as extreme risk):

○     The weekly management meetings are finishing close to 3:00 pm.

○     The assistant management training has been shifted to the mornings allowing the manager to leave before 1:00 pm.

●      By-law compliance risk – reputation/brand loss and fines (initially rated as high risk):

○     An external audit was completed and presented to the board six months after settlement.

○     The board and CEO included a new policy regarding compliance with the Parramatta by-law on water conservation.

○     The plants have been changed to natives.

○     The dual flush toilets are ordered and in stock.

○     The 5 star rated (WELS) dishwasher was installed.

○     The application to make-good by Goldsmith Partners on behalf of MacVille was accepted by the Parramatta City Council.

○     There has been one internal audit arranged by the store.

○     A water tank had been built in to the courtyard.

○     There is a weekly water usage monitor in the staff room.

●      Risk of decreased brand recognition– brand non-compliance (initially rated as high risk threshold):

○     Original Hurley’s staff members were provided with uniforms prior to MacVille launch

○     Warning system for uniform non-compliance is not being applied

Include in their report discussion of the outcomes of their implementation?

Discussion of outcomes should include, but is not limited to:

●      Banking risk – theft of cash left on premises (initially rated as medium risk):

○     now low risk due to insignificant consequence (insurance cover) and ‘unlikely’ likelihood because cash rarely kept on the premises.

●      Manager’s travel risk – physical injury (initially rated as high risk):

○     now considered potential high risk. Likelihood reduced to rare with the change in time travelled.

●      By-law compliance risk – reputation/brand loss and fines (initially rated as high risk):

○     now moderate risk due to unlikely likelihood with the installed water saving devices and processes.

●      Risk of decreased brand recognition – brand non-compliance of staff not wearing the MacVille uniform, or altering MacVille processes and service expectations (initially rated as high risk threshold):

o   now high risk due to increased likelihood of new hires not wearing the uniform and original staff not communicating the importance of upholding the MacVille brand.

Include in their report discussion of the evaluation of their risk management plan and risk assessment?

Discussion of evaluation should include, but is not limited to:

●      Banking risk – theft of cash left on premises (initially rated as moderate):

○     reduced to low risk; could be made more effective by 100% compliance with the daily banking directive and removal of expensive insurance on overnight cash on premises.

●      Manager’s travel risk – physical injury (initially rated as extreme):

○     reduced to high risk because of the continued travel; introduction of teleconferencing would reduce this risk to nil

○     CEO should provide an excusal letter to ensure the manager leaves at the appropriate time.

●      By-law compliance risk – reputation/brand loss and fines (initially rated as high):

○     reduced to moderate risk but could be reduced again to low risk by having Sydney plumbers install the tank and the dual-flush toilets in the next 14 days

○     monitor should be constantly updated to keep staff motivated and a procedure should be written. More internal audits are required.

●      Risk of decreased brand recognition – brand non-compliance of staff not wearing the MacVille uniform, or altering MacVille processes and service expectations (initially rated as high risk threshold):

○     increased to high risk

○     could be reduced by another presentation on brand importance to new hires and training of original staff in upholding MacVille systems and procedures.

Comments/feedback to participant

Outcome:CompetentNot Yet Competent
Assessor name:
Assessor signature:

 

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