BUSM1734 RISK ANALYSIS:RISK PROBLEM INVESTIGATION ASSESSMENT

AIM

This is a group (3-4 students per group) assignment. It is designed to foster collaborative discussion to facilitate the appraisal of risk problems, in particular business risk situations, from a multi-dimensional perspective. Its focus is to reinforce the notion that risk is context-specific and that risk management is predicated on a socially constructed reality of the world. The rigor of risk analysis, as such, needs to be established using a holistic approach that allows the analyst to see not just the trees but also the forest. This is achieved by asking students to use the dynamic system analysis technique to model a risk situation or risk management problem in business. Its aim is to train students develop the skills of applying the system technique innovatively to diagnose, analyze, and solve risk problems in business operations. Emphasis is placed on engendering creative thinking through the combined use of system thinking with a range of related concepts, such as power field, residual uncertainty, paradox theory, and strategic fit.

PROBLEM SELECTION

Select a business-related risk problem with which one (or more) of your group members is familiar to complete the requirements of the tasks stipulated. Some examples of business-related risk problems are:

• Stock-outat a retail outlet
• Operationsdisruptions at a warehouse
• Orderfulfilment failures at a restaurant or a café
• Qualitybreaches in a production facility
• e-Commerceorder fulfilment failures of an online retailer
• Cybersecurityfailures at a major institution

Obviously, the above list is not exhaustive. Feel free to come up with ideas and discuss with your Course Coordinator, who is always open to suggestions.

Note: Whatever problem you may select, you should ground it in a context to enable you to conduct a meaningful and realistic investigation and analysis. For instance, if you select “stock-out at a retail outlet,” you should base the stock-out problem on a specific store you have information, or are able to obtain information (e.g., a store where you are working part-time at or had worked previously) from. Therefore, you should discuss among your group members to select a business-related risk problem with which one (or more) of your group members is familiar to complete the requirements of the tasks stipulated.

 Please reach out to your Course Coordinator to explore what you would like to investigate.

TASKS:

• Describe, with the aid of a diagram (a rich picture), the context in which the problem beinginvestigated is  Indicate how you have obtained the information needed to understand the risk context.

 Note: This task helps you to identify the vulnerable points or hidden risks embedded within the context where the risk problem being investigated could erupt. Your description, therefore, should include: 1) the factors, which, arguably, would be the plausible sources of risk; and 2) the interactions between these factors which could change the relational dynamics leading to further development of the problem.

 Weight for written submission: (13%)

• Using the technique of systems modeling, characterize the problem situation selected as acomplex dynamic system by tracing the interdependency relationships between the key variables and nurturing conditions under which the risk would most likely 

Note: This task helps you to track the cause-effect relationships between the key variables and their nurturing conditions that could lead to the occurrence of the risk problem being investigated. You should either provide the evidence or explain the logic of all the identified causal links between the key variables and nurturing conditions, if those links are not intuitively apparent.

 Weight for written submission: (20%)

• Next,based on the system developed to represent the risk situation, systematically assess the level of control, the level of residual uncertainty, likelihood of occurrence, and change potential embedded in each of the key variables and nurturing conditions perceived to give rise to the risk 

Note: This task allows you to assess the criticality of the key variables, the sources sparking the chain of events leading to the occurrence of the risk problem being investigated. You should, therefore, justify your assessment of each of the key variables identified to develop a comprehensive analysis of their comparative criticality.

 Weight for written submission: (15%)

• Using the results of the assessment conducted under Task 3, derive an (one) appropriate riskmanagement measure (or solution), which may be applied to reduce the risk  Rationalize the merits of the proposed measure by drawing on:
  1. the various schools of thought discussed in the risk management doctrines provided inHood et al. (1992) and summarized in Smallman (1996); and
  2. thedifferent dimensions of uncertainty proposed by Vilko et  (2014).

Note: This task allows you to consider a risk management measure to tackle the most “appropriate” (from the perspective of implementation) critical variable (among the list of critical variables assessed in Task 3) to deal with the risk problem being investigated. Rationalizing the merits of the proposed measure by drawing on Hood (1992) and Smallman (1996) as well as Vilko et al. (2014) gives credibility to the proposed measure in terms of its practicality and conceptual underpinnings in managing uncertainty.

 Weight for written submission: (13%)

• i) If the proposed measure is likely to reduce or manage the perceived risk, assess whether theintended action is likely to create a new risk situation. If so, examine whether any new measures (solutions) have to be adopted to manage the occurrence of the new risk (state the new measure[s] to be adopted); and

Note: This task helps you to understand that all risk measures invariably give rise to new risks. You need to be conscious of what your proposed risk management measure would entail in terms of the new risks that would be generated as a biproduct and what further risk management measure(s) might be needed to ensure that the benefits of managing the risk outweighs its disbenefits.

 Weight for written submission: (4%)

1. ii)Ifone (or more) new mitigation measure is warranted, redraw the system diagram to incorporate the new sets of key factors to fully capture the dynamic complexity of the original and new risk 

Note: This task enables you to gauge the wider impacts generated by the introduction of the risk management measure in Task 4 to better appreciate the benefits of managing the risk problem being investigated and the disbenefits of introducing the risk management measure proposed in Task 4.

 Weight for written submission: (6%)

• Reassessthe system model developed in Task 2, identifying whether other risk mitigation measures may be employed? If yes, compare the relative effectiveness of the new measure(s) against that proposed in Task 4 based on the configurations of the systems model presented in Task 2.

Note: This task allows you to appreciate the value of the systems approach not only to identifying how a risk problem could occur but also to comparing the relative effectiveness of different risk management measures according to the trajectory of the risk problem from different sources.

 Weight for written submission: (13%)

• Assess the relationships between the new risk management measure(s) (i.e., those identified inTasks 5 and 6) and that presented in Task 4 (i.e., original risk management measure) based on the notion of strategic fit advanced by Porter (1996) and appraise the sustainability of all the proposed risk management measures accordingly from the perspective of paradox theory (Poole & van de Ven, 1989; Smith & Lewis, 2011).

Note: This task offers you a means to assess and demonstrate how the risk management measures proposed and the new risks spawning from their implementation may be resolved to arrive at a sustainable set of risk management measures.

 Weight for written submission: (16%)

PART 1 – ORAL PRESENTATION (weight=15%)

Present the results of your analysis of the above tasks using PowerPoint slides. The presentation, which should be in 15 minutes (± 1 minute), will be assessed according to the following criteria:

• Qualityof PowerPoint Slides (35%)
• Qualityof Presentation (25%)
• Contentof Presentation (35%)
• TimeManagement (5%)

PART 2 – INVESTIGATIVE REPORT (weight=35%) PRESENTATION FORMAT

You are required to address the stipulated tasks in the sequence indicated. While not mandatory, a conclusion comprising a few succinct statements synthesizing the findings of the analysis, complete with any suggestions on the merits and limitations of the system approach to risk identification, would add weight to the submission.

REFERENCING AND SUPPORTING GRAPHICS

All statements of claims and statement of facts must be appropriately substantiated by credible reference materials. Some statements of claims can also be logically argued. The use of tables, graphs, charts, and other graphic aids are strongly encouraged.

WORD LIMIT

The body text should not exceed 6,000 words (including diagrams, charts, and tables but excluding the reference list) using a font size no smaller than 10 points at 1.5 line spacing.

ASSESSMENT

The written submission will be assessed according to the extent to which each stipulated task has been carried out based on the depth of the analysis and quality of the discussion.