Identification of Business Risks

Question: Implement selections procedures that increase the probability of finding the right staff for the business. Put in place confidentiality agreements and /or reasonable restraint of trade agreements signed by key staff or where appropriate all staff. Implement a robust performance development system for communication of performanceexpectations and goals, monitoring performance and setting remuneration. Provide ongoing training for staff consistent with the needs of the business. Allocate several people to fulfill key tasks and provide backup in the event of illness or sudden departure. Rotate employees through various functions or departments to familiarize them with other areas of the business; Implement suitable OHS policies to minimize risks. Use equity interests, profit-sharing or other incentives to help retain key personnel and let them share the success they create for the business. Review the period of notice required of staff who resign. Answer: Identification of Business risks Internal risks The internal risks shall consist of the risks posed by the workforce. Lack of job satisfaction shall lead to a high attrition rate for the business organization. In addition, of the compensation structure is not adequate enough it would force the employees to look for other options. In this regard, it can be said that cost of recruitment and selection would be a financial burden on the organization in the process of looking for replacing the employees in this organization. Therefore, it becomes necessary that specific human resource policies are made to retain the existing talent in the organization (Kadareja 2013). Organizational Fraud - Organizational fraud is an essential part of the internal risk that can pose a threat to the sustainability of the business enterprise. As such these can lead to the overall depletion of the financial strength of the organization. In addition, embezzlement of funds can also lead to the shortage of the existing cash funds of a business entity. Thus, this can hamper the daily business functionalities of a business enterprise (Davies 2014). Risk reduction policies Implementing a stringent recruitment procedure shall enable the business organization to select the best possible candidate that would have the necessary skills and the competencies to serve the organization efficiently in the long run. Besides this, backgrounds checks must also be conducted to ensure that the candidate meets the necessary criteria in working for the business organization. Developing confidentiality agreements for each employee shall enable the business organization to ensure that none of the business policies are disclosed to any third party. This would enable the business enterprise to maintain a high level of secrecy. The adoption of an effective performance management system shall assist the business enterprise to monitor the performance of each employee working in the business organization. In this regard, it can be said that following an transparent and honest appraisal procedure without any bias to any third party working in the business organization. This would motivate the employees to offer their best performance and enhance the overall productivity of the entity. Addressing the needs of the employee are another concern that has to be effectively dealt and considered in an appropriate manner. Thus, employees have to be handled in a sensitive manner to prevent the attrition rate in the organization (Basher et al.2015). The risk reduction policy shall be also constituted of implementing effective training schemes for the employees. This shall enable the employee to be familiar with the other business segments apart from their area of expertise. This would assist the business enterprise to ensure business operations and decreasing the operational costs of the business. In addition it would be useful if financial as well as non-financial incentives are offered in exceeding their individual targets. Therefore, this would assist the business enterprise to retain key talent in the organization. Finally dividing the workforce into specific teams shall be helpful to the management of the business organization to allocate tasks. In addition back up resources shall also be useful in the case of a medical emergency or a sudden departure from the business organization. The period of notice served by an employer can be re-considered to prevent stagnation of ongoing projects that can lead to a loss in productivity for the business enterprise. Information Technology risks The failure in the information technology process can adversely influence the business operations to a considerable extent. This can be a major deterrent on the business operations and adversely impact employee performance Strategies to reduce IT risk Protection of key data present in laptops and desktops. Besides this, the backup data must also be kept. Installation of effective anti-virus software to prevent malicious software and programs from harming the IT system and other various processes affecting the organization. The power supply should be strong enough to ensure there is no interruption in the work. Thus, this will lead to enhanced productivity in the business organization. Adequate IT training must be offered to the staff of the organization to assist them to adapt to a technology enabled environment (Davenport, T.H 2013). Financial risks The financial risks mostly relate to the incapability to pay out the short term as well as the long term risks of the business enterprise. In addition, the shortage of funds in the organization also would hamper the daily business functionalities of the business enterprise. External Risks Threats due to customers - The Customers are the primary source of revenue for the business enterprise. Therefore, if customer loyalty shifts towards another business entity or the brand has been unable to explore newer markets it would have an adverse influence on the business performance of the entity (Kaplan and Mikes 2012). Business strategies The following are the business strategies that can be adopted to ensure sustainability of the business enterprise in the long run. Gather consumer feedback and develop marketing and operational policies as per the marketing conditions. In addition, establishing long term service contracts with buyers shall assist the business enterprise to prevent consumer loyalty to shift to other brands. Explore newer business areas to gain a larger market share. This would assist the business enterprise to reduce the financial risk that can pose a major threat to the sustainability of the business enterprise. Effective consumer policies shall enable the business enterprise to develop a positive consumer perception among the consumers. This shall lead the business enterprise to develop brand loyalty among the consumers and towards achieving further growth (Haley et al. 2012). Threat from competitors The presence of substitute brands can pose significant threat to the business sustainability of . Therefore, it is essential that distinctive marketing and operational strategies are made to assist the entity to survive strong market competition. This would ensure that consumer loyalty is not shifted to other similar brands operating in the same product and service line. Threat from economic condition An adverse economic condition can hamper the purchasing power of consumers in a substantial manner. In addition, the price of the goods can also increase which can have a negative impact on the sales revenue of the business entity.As such, essential business strategies must be implanted to ensure that the organization is protected against the vulnerable economic condition of a place. Stakeholders of the business The following are the stakeholders in the business organization Owners of business Managers Employees Costumers Suppliers Competitors Shareholders Local community Local council Government Tools Used To Identify Risk The following are the tools that would be required to identify the risks. Brainstorming Surveys Interviews: Business skills Relevant business documents of the past years Output gathered from the examining risk analysis Historical Data Templates Assessing Risks The probability and the impact matrix can be used in categorizing and prioritizing the risk involved. The risk assessment procedure shall be facilitated by the probability and the impact matrix used by the business enterprise. The tool can be used to raise the general level of awareness in the business organization. In the probability and the Impact matrix procedure the risk is rated considering its impact on the business organization. Additionally, a risk is dependent on attributes like the industry, company, project as well as the people involved in the business organization. The following are the methods that can be used to monitor as well as control of risks Assess time and effort that is to be spent on each task Assesses the estimated time that would be required to complete the tasks Evaluate the impact of job performance on emergency tasks Define the action plan in the case of business risks as well as emergencies. Assess the roles and the responsibilities of the executives and the middle- ranked employees. The procedure of monitor and assessing the risks remain essential, due to its ability to frame the necessary plan of action in the event of a risk hampering the business sustainability of a business enterprise. This shall also enable the business organization to safeguard against hampering the business performance. Each of these control measures would be handled on a regular basis which would enable the business enterprise to assess their relevancy in the event of a risk. In addition employee performance would be measured, in the context of the contribution towards the business organization (Burke 2013). In the context of assessing the risk the following are the indicators that are essential to the success of the business organization Sales revenue Employee retention rate The degree of success in emergency situations The frequency of identification of risk The existing market position of the business enterprise in comparison with the past year . Risk Register Risk Risk likelihood Risk impact Treatment Monitoring Timelines Responsible Consumers Medium High Gather consumer feedback and develop marketing and operational policies as per the marketing conditions. In addition, establishing long term service contracts with buyers shall assist the business enterprise to prevent consumer loyalty to shift to other brands.. Explore newer business areas to gain a larger market share Reduction in operating costs to retain the existing financial strength of the business organization Revenue figures Customers Monthly and quarterly reporting Executive managers of the business organization Employees Medium High Implementing a stringent recruitment procedure shall enable the business organization to select the best possible candidate that would have the necessary skills and the competencies to serve the organization efficiently in the long run. Developing confidentiality agreements for each employee shall enable the business organization to ensure that none of the business policies are disclosed to any third party. The adoption of an effective performance management system shall assist the business enterprise to monitor the performance of each employee working in the business organization Following an transparent and honest appraisal procedure without any bias to any third party working in the business organization. The risk reduction policy shall be also constituted of implementing effective training schemes for the employees Enable the employee to be familiar with the other business segments apart from their area of expertise. Financial as well as non-financial incentives are offered in exceeding their individual targets. Review the period of notice required of staff who resign. Training manuals Recruitment statistics Sales revenue Internal survey Monthly as well as quarterly reporting Managers and individual staff. Information Technology Medium High Protection of key data present in laptops and desktops. Besides this, the Backup data must also be kept. Installation of effective anti-virus software to prevent malicious software and programs from harming the IT system and other various processes affecting the organization. Protection of networks and servers Developing effective business applications Adequate IT training must be offered to the staff of the organization to assist them to adapt to a technology enabled environment. Evaluation of work done and comparing with the pre-determined goals set at the outset Defining plan of action Monthly as well as quarterly reporting Managers and individual staff. Reference List Basher, R., Hayward, B., Lavell, A., Martinelli, A., Perez, O., Pulwarty, R., Sztein, E., Ismail-Zadeh, A. and Cutter, S., 2015. Disaster Risks Research and Assessment to Promote Risk Reduction and Management. Burke, R., 2013. Project management: planning and control techniques. 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