The Suppliers and the Customs Authority - Assignment Example

Risk Analysis, Treatment and Monitoring in Risk Management Processes Assignment Name 2.0 Risks Analysis and Evaluation 2.1 Risk Analysis and Documentation with Consultation with Relevant Stakeholders Stakeholders such as the suppliers, the buyers and the customs authority are involved in the process of risk occurrence, especially for the specific risks that relate to them (Global Risk Alliance, 2005, p. 30). For instance, pricing risk involves the suppliers and the customs authority among others while the competition risk is depended on the business management team as stakeholders and both the customs authority and the suppliers. Supplier factor is solely risk related to suppliers. It is, therefore, important that the stakeholders are controlled appropriately to manage the risks that relate to them. For example, the customs authority will be able to assist in managing competition risk by providing relevant data relating to importers of dates palm into Australia and the names of the business dealing in dates palm importation. Such information will assist in planning counter actions that would put the business ahead of the rest in the market. 2.2 Risk Categorization and Determination of the Levels of Risk The competitor factor is a risk that is major in consequence and is likely to occur. It, therefore, fall on the amber color that corresponds to the level of danger after red color for the extreme danger for both catastrophic and almost certain risks. The likelihood of both pricing factor and the supplier one are possible, yet the pricing factor ranks higher in consequence by having a major implication on the business as opposed to supplier factor that has moderate effect on the business in the event of its occurrence. Both of the supplier and pricing factor fall in the yellow color in the risk categorization and determination table 1 showing that they are of moderate importance overall (Global Risk Alliance, 2005, p. 31, 54). Table 1: Risks categorization and determination for the dates palm international business Risk Consequences Likelihood of Risk Catastrophic Major Moderate Minor Insignificant Almost Certain Likely Competitor Factor Possible Pricing Factor Supplier Factor Unlikely Rare 2.3 Document Analysis Processes and Outcomes Both brainstorming and questionnaires was used in deciding the likelihoods and the consequences of the risks as qualitative and quantitative means of assessing the risks. The levels of risk corresponded to the industry average for the fruit imports into Australia. The outcome of the risk analysis can be seen to categories the competitor facto r as the highest risk to be focused on with most acre followed by the pricing factor that fell into the moderate level and lastly the supplier factor that is in the same level of moderate risk (Global Risk Alliance, 2005, p. 32). 3.0 Risks Treatment 3.1 Determination of Appropriate Control Measures for the Risks and Assessment for Strengths and Weaknesses Risk Factor Control Measures Competitor Factor 1. Use marketing efforts to increase market penetration and reduce market share of competitors in the same industry. 2. Keep business such as suppliers and consumers details secret to reduce the likelihood of new entrant competitors into the same business line and market. 3. Monitor the activities of competitors and counter their strategies all the time by regular review of own marketing and promotional strategies. Pricing Factor 1. Use critical pricing that gives room for readjustments according to the monetary exchange rates between the two nations. Supplier Factor 1. Creating stand-by details of reachable suppliers who can be contracted with ease and immediately in case of shortages of products in the countries of origin. 2. Stocking enough for the periods of low supply in the time of high supply to reduce shortages. 3. Outsource supply from middle-men such as importing agencies that might be having stocks during shortage and charge reasonably. Source: CPA Australia Ltd. (n.d). 3.2 Identification of Control Measures for all the Risks Timing is one way of controlling most all the risks. For instance, the changes in pricing can be timed to maximize on the times when the exchange rates are favorable for the business. Also, the suppliers can be times to maximize on the seasons when the products are available in abundance in the country of origin to reduce scarcities that would interrupt business in the country of sale (CPA Australia Ltd, n.d). 3.3 Referral of Risks Relevant to All of Organization or Having an Impact Beyond Own Work Responsibilities and Area of Operation to Others as per Established Policies and Procedures Monitoring of the exchange rates for the currencies of the two countries and predictions of the future trends is one aspect that would require expert opinion such as economists who have had enough experience in the field. This will be delegated to the senior management of the dates palm business. Also, the identification and liaison with the local agencies who can import on behalf of the business to reduce shortages during the low supply periods is a responsibility of the purchases department (CPA Australia Ltd, n.d). 3.4 Choosing and Implementing Control Measures for Own Area of Operation and/ or Responsibilities The control measure for competitor analysis is fully the responsibility of marketing and promotion department. The use of marketing efforts to keep ahead of competitors is the main strategy of choice for the risk factor followed by the monitoring of the competitor activities and then keeping the business secrets such as the areas of supply and supplier prices confidential. Monitoring of competitors will be an on-going activity to secure competitive advantage in the industry. Pricing is also part of the marketing and promotion department and will be the first control against the price risk. The trends in price fluctuation will be monitored in order to remain safe for the periods of inflation (CPA Australia Ltd, n.d). 3.5 Preparation and Implementation of Treatment Plans One of the means of preparing for the implementation of the control to the risks will be the identification and contacting of the relevant human resources who are to bridge the gaps determined by the measures. For instance, the need for an economic analyst requires contracting of an expert in that field in part-time basis while the bureau of dates palm importers and exporters will be vital in the identification of brokerage agencies to buffer low yield seasons (Global Risk Alliance, 2005, p. 37). 4.0 Monitoring and Reviewing Effectiveness of Risk Treatments 4.1 Regular Review of Implemented Treatments against Measures of Success The control measures that require longer time such as six months to experience such as the price fluctuations and the supplier stock shortages will be revised annually while those that take shorter time such as competitor analysis and monitoring will be done monthly or quarterly. The results will be communicated to the relevant departments and authorities timely and appropriately (Global Risk Alliance, 2005, p. 39). 4.2 Using Review Results to Improve the Treatment of Risks The communicated results of each review will be acted upon with appropriate reaction steps which may include readjusting the measure or changing it completely for another control option that is more effective going by the evaluations (Global Risk Alliance, 2005, p. 39). 4.3 Providing Assistance to Auditing Risk in Own Area of Operation The marketing and promotion department will be part of the risk auditing team reviewing the risks and taking the results for action from the concerned parties. The assistance will include encoding of information relating to the outcomes of the risk control measures against the set targets (Global Risk Alliance, 2005, p. 39). 4.4 Monitoring and Reviewing Management of Risks in Own Area of Operation The review of the control measures that fall directly under the marketing and promotion department will be served to the audit team as other departments before the auditing begins (Global Risk Alliance, 2005, p. 39). References CPA Australia Ltd. (n.d). Risk Management Guide for Small to Medium Businesses. Melbourne, Australia: CPA Australia Ltd. Retrieved 22 June. 2014 from http://www.cpaaustralia.com.au/~/media/Corporate/AllFiles/Document/professional-resources/business/risk-management-guide-for-small-to-medium-businesses.pdf Global Risk Alliance. 2005) Risk management guide for small business. Global Risk Alliance and NSW Department of State and Regional Development. Read More