Course Code and Title: FINE3 Risk Management

Lesson Number: 4
Professor: Jamaal Villapaña, MBA
Topic: Risk Identification
Introduction:
One of the tools that we have learned from the previous module is a SWOT analysis. In
this lesson, we will dwell more on how we identify risks in a business.
Learning Objectives:
1. Interpret the potential risks associated with a business.
2. Distinguish the types of risks that the organization could be exposed to.
3. Demonstrate ethical standards by being honest and respectful.

Pre-Assessment:
What instances that a business could be at risk?
1.

2.

3.

4.

5.
LESSON PRESENTATION
Risk Identification
One of the most important investments you can make in a
business is creating a business plan, especially when
identifying risks. Creating a business plan will help you
assess risk areas, those areas impacting your ability to
continue business and to grow.

Prepared by: Jamaal T. Villapaña, MBA

The continuation of a business, in the event of any risk,
should be addressed in the plan. Look at anything that could
halt, slow, or affect the profit of the business. List these risks,
rank them in importance, and look at potential costs.
Identifying and assessing risks is something that will require
time and should be revisited periodically. Be sure to schedule
time in your calendar to identify areas of business risk.
Get help from outside sources in identifying areas of
risk. Many of these sources are business-specific.
Some sources for help are listed later in this module.
A business plan isn’t something to create and set aside,
simply to be used later to obtain financing. Once
completed, the business plan will become your guide, just
like a map.
Risk management is a management committee's responsibility. The management
committee has the ethical, and in most cases, the legal responsibility for what
happens within the organization they govern. As a first step, the management
committee can form a small working group to develop a risk management plan. To
ensure that the broad ranges of interests within the organization are considered, the
working group should include at least one staff member and one member of the
management committee. While the working group will be responsible for developing
the risk management plan, the management committee should oversee the process
and make the final decisions required to implement the plan.
Identifying the Risk
The types of risks your organization could be exposed to include:
• Loss, theft or damage to property
• Loss of life or damage to health
• Breaches of corporate duties by an organization or its officers
• Breaches of other laws
• Professional negligence

Prepared by: Jamaal T. Villapaña, MBA

 • Loss of your organization's good name

Listed below are a range of steps that a risk management working group could use
to identify the risks your organization faces. This is a useful way to begin
documenting what you find out as part of your risk management plan. As you identify
the various risks your organization faces, writing them is necessary.

Inspecting The Site

Look around your workplace. What potential risks can you find? Look at the
workplace from the perspective of the different people who use it. Are there hazards
for children, older people, or people with impaired sight? What are fire hazards? Are
there loose electrical connections, or damaged furniture? How hot is your hot water,
and how accessible is it to children? Take some photos, perhaps even a video if you
can, and study it closely. It is a good idea to have a couple of people who do the site
inspection so that you can compare notes.

Reviewing Your Organization’s Work Practices

The activities carried out in your organization will have varying degrees of risk. Do
staff members work with potentially dangerous clients? Is staff required to perform
physical activity which may result in injury (for example, lifting clients)? Is your
organization's work particularly stressful? Is the staff required to do a lot of driving,
and if so, are they using their cars, your organization's cars, or both?

Review your work practices from the perspective of other people who use your
service. Are clients exposed to risks from other clients, people off the street, or other
sources? What about volunteers and management committee members?

Explore Your Legal Exposures

Your organization may be exposed to some legal risks associated with issues such
as workplace health and safety, liability to clients, judiciary duty, or anti-
Prepared by: Jamaal T. Villapaña, MBA
discrimination legislation.

Do A “What If” Analysis

For example, what if:
 Your organization's coordinator or manager had a serious accident tomorrow?
 Your organization's files were burnt or stolen?
 You discovered someone had embezzled several thousand of money?
 There was a major industrial accident?
 Industrial action was taken?
 Racial discrimination occurred in the workplace?
 Your organization was sued?

Talk To Staff
The people who do the work often have the best idea of the risks the organization
faces. Talking to the staff can occur through individual interviews, raising the issue of
risk at a staff meeting, or having specially structured sessions.

GENERALIZATION
The students should learn the initial step in risk management planning which is risk
identification. Identifying risks is very important for the company to pinpoint potential
events that can harm the organization.
EVALUATION
A. Identify five potential risks of engaging in new business at this time of the
pandemic. (2 points each).
1.

2.

Prepared by: Jamaal T. Villapaña, MBA

 3.

4.

5.

REINFORCEMENT
Collaborate with your group mates and do your tasks for the Risk Management Plan.
This task should be written (please write legibly) or typewritten in a short bond paper,
and kindly observe a one-inch margin and double spacing. On the top centermost of
your paper; write our subject, followed by your company name. On the left portion, write
the names of the members; and on the right portion write your section and the date that
you finish your assignment.

Group work for Risk Management Plan – Redesign your initial SWOT Analysis
according to risk identification.

 ONLINE RESOURCES : Participant Guide – Risk Management

www.sba.gov
Risk Management Introduction,
Queensland Government.
www.riskmanagement.qld.gov.au
Organization and Management
www.pearsonhighered.com

Prepared by: Jamaal T. Villapaña, MBA