To start with, it is necessary to identify the scope of risk management. As it is seen in the materials of the case, Paula Kinski, the CEO, suggests such stages of risk management: review, analysis and planning, and monitoring. On the first stage it is necessary to take into consideration the risks that already exist. After that the following risks need to be discussed, and the ways to prevent or overcome the risks need to be selected. On the third stage, when all the major problems are solved, the situation still needs to be monitored.
Speaking about the risks which already exist, it is known that MacVille has agreed to employ all the existing staff on three month probation. Also the current supervisor James Mansfield, was offered the position of second in charge, which he has accepted. Though the final settlement on the purchase is not still made, the seller gave the right to the company to observe and control all the processes which already exist in the store. For this reason the meeting of the supervisor and the team should take place. At the following meeting it is necessary to discuss the existing strategy; the questions which need thorough examination include marketing, finance, store management, etc. Also the statistic information concerning the business and its activities should be revised.
After the basic information about the store has been taken into consideration, the manager in charge was able to identify the main points which caused concern. The first one was the location of the store. It was discovered, that the way from Toowoomba to Brisbane takes about two hours, which can be the problem both for the managers who have to commute from one location to another and for the delivery process. For example, if the managers stay at work till late hours, it will be quite inconvenient for them to drive back home. Also the delivery of fresh pastry from the company central bakery does not make sense. Speaking further about the potential risks, it is possible to say that previously the store was a family business. This means that practically all the business processes were controlled by the family members, and also there were no clear policies in the company. It can be explained by the fact that the business was small, so no written policies were created. One more problem which needs solution is the usage of water and other resources. It is apparent that in the store no systems which could make the resources consumption more efficient are used. It is possible to make the upgrade of all appliances, but in this case additional costs will be required. Also some of the furniture needs to be repaired or has to be changed.
Speaking about other areas which need improvement, they include the area of finance and banking. As it is known from the research, the banking in the store is not done every day, so sometimes quite large sums of money are kept in the store overnight. …