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CHOSEN ALTERNATIVE CASE - RISK ANALYSIS

Risk Identifier Risk Significance Significance = Risk Strategy

Business Area (Likelihood + Severity + (Assumption, Avoidance,
Task Description (Define Risk) Likelihood Severity Level of Control Level of Control) Control or Transfer) Risk Mitigation Plan Risk Significance
Sales employees Turnover risk due to least response from client Implement effective marketing
survey Plan

1 3 4 1 8 Control

Likelihood
Human resources Managing Human staff members in Business Enter into strategic alliance with
2 department 4 3 1 8 Control consultancy companies
1 Very unlikely
Financial manager Increased business costing due to high cash Prepare budget and proper cost
3 outflow 2 3 2 7 Assumption variance report preparation
2 Somewhat unlikely
Business Owner Changes in the P.V. factors Undertake hedge funding or
4 3 2 1 6 Avoidance derivatives contracts
3 50/50 Chance
Business Increased business costing Undertake hedge funding or
5 management 3 1 1 5 Avoidance derivatives contracts
4 Highly likely
Sales manager Loss of Business due to the non-acceptance of Prepare strategy to enter into the
6 products in market. 2 2 2 6 Transfer more expanded market
5 Nearly Certain
IT experts Failure of machines in system process Hiring More personal for the
7 3 3 1 7 Control machine failure management work
Legal compliance Non-compliance of corporate governance Arrange corporate governance
8 department mechanism 2 3 2 7 Transfer legal department
Severity
Business Reduction in the supply of the clothes in stores Enter into the Outsourcing Alliance
9 contractors or shortcoming of the products 3 2 1 6 Transfer to buy manufactured complete
1 Minor impact on cost, schedule, performance, etc.
clothes
Business Absolution of the purchased clothes Focus on creating core competency
10 management 4 3 4 11 Control in product differentiation
2 Moderate impact on cost, schedule, performance, etc.
customized strategy
Line manager Breakdown in the machines and plants Create provision for depreciation
11 3 2 1 6 Control account to buy new machines
3 Significant impact on project baselines
Financial manager Financial crisis in market Enter into the diversified market to
12 1 3 1 5 Avoidance win the sluggish market position
4 Very significant impact on project baselines
Managers Destruction in business implication ideas and Hire expert Management
13 strategies 2 2 1 5 Control employees to reduces the business
5 Disastrous impact, probable project failure
failure
Sales manager High market Competition Formulate business strategies with
14 3 2 2 7 Assumption the assumption of high compete ion
in market.
IT experts Advancement in the technologies Focus on advancement in
15 2 3 1 6 Control technologies in business
Level of Control
Product Manager Changes in the client's values and likeness Sell only customized products as
16 3 4 2 9 Transfer per the client's values
1 Essentially avoidable through selected risk mitigation actions
Directors Increased service costing to clients due to the Use strategic tools such as
17 increased inflation rate 3 4 1 8 Transfer Hedging, future contract and
2 Highly controllable through organization or project actions
Forward contract to control the
Financial manager No-availability of funds Focus on private funding and
price value
18 3 2 1 6 Control Charge creation on assets
3 Moderately controllable through organization or project actions
Directors Market recession Implementation of Business
19 2 2 2 6 Transfer strategies and financial implication
4 Largely uncontrollable by the organization or project actions
Directors Non-effective implication of business strategies Develop internal control business
20 2 3 1 6 Control system
5 Uncontrollable by the organization or the project
Directors and Failure to implement cost leadership strategy Develop Core competency in
21 managers due to high costing 3 2 1 6 Control product differentiation as
alternative.
Managing directors Market risk Create Strong brand image by
22 2 3 2 7 Control focusing on target market
Risk Strategies
segmentation
Financial manager Financial risk Bank borrowing and focus on using 1 Assumption - accepting the risk and its impact should it occur, best suited for low risk classifications
23 3 3 1 7 Control the private funding
Business Brand image risk of London King Risk Use offline and online market 2 Avoidance - Not willing to accept the risk. This generally involves eliminating the source of the risk by a change in concept,
24 management 3 2 2 7 Control making strategies and program requirements, specification and/or practices to reduce the risk to an acceptable level
3 Control - This option does not attempt to eliminate the source of the risk but seeks to reduce or mitigate the effect should
… 0 the risk occur. It manages the effects of risk in a manner that reduces the likelihood and/or consequences of its occurrence
on the project.
4 Transfer - This option may reallocate risk from one part of the system or organization to another thereby reducing the
overall risks probability of occurrence and impact.

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