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LA024401, Assessment 1, BSBRSK501 Ed 5 1 © New South Wales Technical and Further Education Commission, 2019 (TAFE NSW), Archive version 1, April 2019 BSBRSK501: Assessment 1 What you have to do For this assignment, you will need to prepare a risk management plan for your organisation or for some other organisation from which you can obtain relevant information. Hint: Choose a small/medium sized business. Build a risk management plan for a small business such as a sole trader – a flower shop, homewares, bakery, or electrician rather than attempting to dissect a large Bank, McDonalds, a multinational insurance company, Bunnings or Woolworths. Task Task 1 Establishing the context – Your organisation will consider both internal and external factors when identifying and managing risks associated with the achievement of strategic and operational objectives. a) Provide an introduction and an overview of your organisation, include the goals or objectives. 2 LA024401, Assessment 1, BSBRSK501 Ed 5 © New South Wales Technical and Further Education Commission, 2019 (TAFE NSW), Archive version 1, April 2019 Stakeholder Stakeholder Role (internal or external stakeholder) Stakeholder’s issues or concerns/ priorities e.g. Describe the stakeholder group or the title such as CEO Define are they internal stakeholders or external stakeholders, define what role this group has with the organisation e.g. What influences this stakeholder - a Finance Director’s priority may be to increase profit margin by decreasing expenses Political Technology e.g. Discuss how a change in government may affect specific factors e.g. IT issues Economic Environmental factors e.g. Drop in Australian Dollar outline what this will affect e.g. weather what impact does this have Social issues Legislation e.g. trends, culture, customer needs e.g. name 3 laws the organisation must abide by for operating their business Competitors / Suppliers or customers Any other factors b) Identify internal and external stakeholders for your organisation and their issues/concerns or priorities; provide your responses in the stakeholder analysis table. c) Review external factors in the environment; complete the following table listing political, economic, social, legal, technological and competitor/supplier factors that may affect your organisation. LA024401, Assessment 1, BSBRSK501 Ed 5 3 © New South Wales Technical and Further Education Commission, 2019 (TAFE NSW), Archive version 1, April 2019 Task 2 Risk assessment – Research the overall processes of risk management within your organisation, risk identification, risk analysis and risk evaluation of existing practices and procedures. a) Describe the existing organisational processes, procedures and requirements for undertaking risk management for your organisation. b) Discuss if existing practices are in accordance with the Australian Risk Management standards and processes. c) Describe how risk management processes are communicated to stakeholders, what consultation and communication activities are conducted as part of the ongoing planning and management of risks in your organisation. 4 LA024401, Assessment 1, BSBRSK501 Ed 5 © New South Wales Technical and Further Education Commission, 2019 (TAFE NSW), Archive version 1, April 2019 Task 3 Risk identification – Identify risk sources, areas of impacts, events, causes and possible consequences to form a comprehensive list of risks based on those events that might create, enhance, prevent, degrade, accelerate or delay the achievement of objectives. a) List the existing tools, techniques, systems, forms or processes within the organisation to identify or monitor risks. b) Describe how the relevant stakeholders will be involved in the processes to identify risks. c) Conduct a SWOT analysis of your organisation to identify risk factors, ensure that a wide range of risks are identified from different business functions. List your factors in the following SWOT table. Strengths Weaknesses e.g. Brand reputation, reliable staff e.g. Bureaucratic style of management Opportunities Threats e.g. New product launch, expansion e.g. Competitors LA024401, Assessment 1, BSBRSK501 Ed 5 5 © New South Wales Technical and Further Education Commission, 2019 (TAFE NSW), Archive version 1, April 2019 Task 4 Risk analysis – Consider the range of causes, sources of risk, consequences and likelihood to produce a risk rating. The rating can then be used to determine further management by the organisation. Place all your responses in the Task 4 Risk Analysis Register (on the following page). a) List 10 risks into the RISK column with a brief description to represent each risk. (The 10 risks must be risks identified in the SWOT analysis table and must represent risks from a range of departments/functions from your organisation). b) Risk Reference. Create your own risk reference as a unique identifier code for each risk e.g. a marketing risk may be given the risk reference code of MARK001, Warehouse risk may be WARE001. c) Analyse each risk, briefly note what can happen if the risk occurs in the EVENT column d) Analyse each risk, briefly note how it can happen in the CAUSE column e) Evaluate each risk, briefly note what are the long term level of impact if the risk occurs CONSEQUENCES column f) Assess the current risk management strategies for each risk and determine if the current control strategies are either Adequate (A), Moderate (M) or Inadequate (I). g) Refer to the risk matrix tool positioned on the page after the risk analysis register table. The risk matrix is required for analysing the types of risks for your organisation. The risk matrix is required to define the current risk level for each risk by considering the likelihood against the consequence. Determine the Likelihood level (or the probability of each risk occurring). (The likelihood rating for risk occurring requires the assessment of the potential frequency of occurrence without reference to management controls or mitigating). h) Define the Consequences level, assess the potential people, financial, reputation, compliance or business process/system impact. i) Determine the Level of risk from mapping the likelihood and consequence on the risk matrix. Task 5 Risk evaluation – The level of risk identified during the risk analysis can be ranked and prioritised according to a consistent overall ranking and rating system. Continue to place your responses in the Risk Analysis Register. Re-sequence all 10 risks in the risk register based on their priority; position the risk with the first priority at the top of the risk analysis register and the second highest risk to be positioned under the first, and so forth. k) Acceptability of the risk, decide if the risk is acceptable (A) or unacceptable (U) l) Treat the risk, will action be required to treat the risk, Yes or No. j) Risk priority. Compare and prioritise the levels of risk for all 10 risks. The risk with the highest level of risk will be ranked as 1, the first priority, the risk with the next highest level of risk, 2 as the second priority and so forth. Define the risk priority for all 10 risks. 6 LA024401, Assessment 1, BSBRSK501 Ed 5 © New South Wales Technical and Further Education Commission, 2019 (TAFE NSW), Archive version 1, April 2019 Task 4 Risk Analysis Register: (Enter the name of your organisation) Function (activity e.g. department): Compiled by: Date: Date of risk review: Reviewed by: Date: Risk Reference (unique identifier code b)) RISK What is the risk? a) EVENT What can happen? c) CAUSE How can it happen? d) CONSEQUENCES What is long term impact if it happens? e) Current control strategies A (Adequate) M (Moderate) I (Inadequate) f) Current risk level analysis Risk priority j) Ac ce pt ab ili ty o f Ri sk A (A cc ep ta bl e) o r U (U na cc ep ta bl e) K) Treat Risk Yes or No l) L ik el ih oo d le ve l g) Co ns eq ue nc es le ve l h ) Le ve l o f r is k i) LA024401, Assessment 1, BSBRSK501 Ed 5 7 © New South Wales Technical and Further Education Commission, 2019 (TAFE NSW), Archive version 1, April 2019 Risk matrix Source NSW Government: Risk management toolkit Viewed 5/2/19. Available at: https://www.treasury.nsw.gov.au/information-public-entities/governance-risk-and-assurance/internal-audit-and-risk- management/risk https://www.treasury.nsw.gov.au/information-public-entities/governance-risk-and-assurance/internal-audit-and-risk-management/risk https://www.treasury.nsw.gov.au/information-public-entities/governance-risk-and-assurance/internal-audit-and-risk-management/risk 8 LA024401, Assessment 1, BSBRSK501 Ed 5 © New South Wales Technical and Further Education Commission, 2019 (TAFE NSW), Archive version 1, April 2019 Task 6 Risk treatment – Select one or more options for the most appropriate actions to modify