Tag: Risk Management

Health and Safety Management

Health and Safety Management Essay

Health and Safety Management – The British Airways Company being a member of the European airlines’ royal family, carries cargo and passengers to destinations exceeding 150 in some 75 states from hubs at the city of London’s Heathrow, Gatwick and airports in London city. The carrier does its operations to a fleet of aircraft exceeding 240, which consist mainly of Boeing jets and Airbus.

BA (British Airways) stretches its network and services to destinations that exceeds 400 in total, through agreements of joint business and relationships that are code shared with AMR’s airlines from America and Oneworld alliance members, for instance, Qantas. Iberia, which was Spain’s number one airline, merged with the BA (British Airways) in 2011 that led to the formation of IAG (International Airlines Group).

The company comprises of a workforce personnel who add up to approximately 57,000, who happen to be distributed to several sectors or sections, for instance, the management, customer service, grounds operations, security, finance, and so on. However, BA being a well recognized airline company, my company is an affiliate of it whereby it deals with clearing and forwarding of goods that are being transported.

The company does its operations on ground level only mainly for BA airlines, and it has a workforce of about 450 employees. The employees are spread across and all over within the airline’s are of work (grounds only). The company mainly deals with luggage on transport or that are imported or exported, cleaning of the aircraft, luggage inspection and so on.

Health and Safety Management

For every company that has employees or workforce that exceeds five in number, should come up with health and safety management measures as required by law in addition to several other management of safety that are subjected as legal requirements. The British Airways (BA) is one of the companies that are subjected to this. Every year, over 200 people get killed and over a million get serious injuries every year at their work stations or places.

Those who suffer from illnesses made worse by or caused by their work are over two million. Forestry industries are the industries that are well known to be more dangerous, and workers in this sector are prone to more dangers that can result to death and/or illnesses when they are at work compared to any other industry or company, for instance, in construction sites or even airports in this case. However, no danger is greater than the other, provided that it can maim or even kill, it is still danger and for that reason, safety and health measures should to be put to safeguard the lives of the workers at the work premises.

Health and Safety Management
Health and Safety Management

The provision of health and safety management training and information has its importance to every individual in instances where it helps to; ensure that workers or employees is not made ill or/and injured by the kind of works that they engage themselves in, developing of a culture that is safe and of positive health, whereby healthy working and safety becomes every worker’s second nature, realizing and finding out how to manage safety and health better and finally, meeting the legal obligation of protecting the health and safety management of workers.

Training the workers effectively also has its significance, whereby; it contributes towards enabling the workers to be experienced in safety and health, assists companies to keep away from stresses that ill health and accidents cause, and finally, help the companies to stay away from financial expenses that are likely to be caused due to ill health occupations and accidents. In addition, it is important to consider that, not all losses are covered by the insurance company. Products that are damaged, production that are lost and workforce that lacks motivation can all be the cause.

Health and Safety Management at Airports

Health and safety management in airports is paramount in the delivery of every project, and operate a system of safety management. The system of system management adopts the main beliefs of the guidance on successful health and safety management and is controlled in full observance with every current legislation safety. Young and Wells (2011 p. 78) give out a suggestion that, highlighting that is done is normally based on regulations on construction, design and management (2007) with airports gratifying the role of contractor or principal contractor, the assessment of risk for the purposes of identifying hazards, risk evaluation, implementation of harmless and secure systems of work and related controls, providing training and awareness for every employee from every level and finally, controlling of the sub contractors.

Like in most airports, according to Fuller and Varssie (2004 p. 112), the health and safety management and systems, replicates detailed approach to in the provision of work for every employee and the company’s duties to others. The company has a safety record that is of excellence, managers who normally attend course of safe management, are usually trained with perfection. The monitoring and the enforcement of the policy regarding health and safety management performance across every business activity through:

  • Toolbox talks
  • Safety audits and inspections
  • Reporting of accidents and near miss
  • Regular reports about safety
  • The involvement of a member of staff and communications
  • Regular meetings regarding management team, with a resilient stress on performance of safety
  • Regular meetings on management with a resilient highlighting on management, safety and performance

Accident assessment at workplace

According to Ludwig and Ayres (2007 p. 67) they suggest that, there are various common accidents that do occur in workplace. Injuries at places of work that are suffered by workers who work in the airport, are not restricted to scrapes, paper cuts and other negligible issues. A good number of workers (probably thousands) — whether they conduct their work inside an office or at a site that construction is underway — put up with incapacitating, life-changing injuries every year. If anyone or a loved one for that matter, became ill withed an injury when he was on his place of work, he should seek out for the assistance he needs as soon as possible.

According to Ludwig and Ayres (2007 p. 76), waiting excessively for so long to file an allegation, could put one’s capability of obtaining full reimbursement at jeopardy. For example, Hank Barnett of The Barnett Law Firm has important familiarity of helping workers who are injured to obtain their compensation via the compensation system of Georgia’s workers’. As of 1983, he has assisted a lot of clients file winning claims or appeals a refutation of reimbursement benefits of workers’. He figures out the functionality of the system, has familiarity in dealing with companies that handle indemnity (insurance companies) and works hard to defend the rights of his clients at any given time.

Common Injuries Due to a Workplace Accident

A number of law firms, among them, The Barnett Law, Firm have assisted workers with injuries who are from the range of syndrome of carpal tunnel and injuries of repetitive stress to accidents that have caused a catastrophic death of a cherished one. It is understood that that a number of injuries may have need of an employer to create accommodations for instance, an impermanent change in duties of work, at the same time as others averts the injured worker from working for extensive periods of time. Whatever the state of affairs, According to Fuller and Varssie (2004 p. 134), the law will make sure that the injured worker is given the care and reimbursement he necessitates. Other common workplace injuries include:

  • Neck and back injuries
  • Injuries of the spinal cord
  • Brain trauma (TBI) and head injuries
  • RSD (reflex sympathetic dystrophy) and chronic pain
  • Ankle, knee and leg, injuries
  • Occupational / workplace disease
  • Burns or injuries those are chemically-related
  • Psychological disorders
  • Aggravation of pre-obtainable injuries

The law is conscious that one is going through a traumatic time. Therefore, it concentrates on getting results fast and provides the clients with the kind of respect they ought to have (National Research Council 2012 p. 89).

Common examples of accidents at work – Health and Safety Management

Accidents at places of work can occur at whichever time and to any person whether an individual is working in an office, a warehouse or a shop. According to Fuller and Varssie (2004 p. 167), scores of these will rely on the kind of working surroundings, for example, recurring Strain Injury is more probable to occur in an office like place of work and injuries of the back from physical work. Despite the fact that it is the employer‘s responsibility of anyone to minimize the risk of accidents, they do unluckily take place from time to time. There are scores of injuries of dissimilar types that can come to pass in the places of work including:

Trips and Slips

Just about a third of accidents that come about in the places of work are a consequence of trips and slips. Trips and slips injuries take place mainly for the reasons that are relating to wet floors because of bad weather poor or housekeeping, or objects hindering the footpath for example cables or floors that are uneven. Young and Wells (2011 p. 126) suggest that these injuries can vary from negligible bruises and bumps to main fractures. To minimize such incidences or accidents then some measures have to be put to combat injuries that are liable to be brought about by trips and slips. Ensuring that there should be no wet floor and incase of any, then it should be dried up immediately. The floors should be rough like to enhance grip while walking hence no trips will be likely to occur, and finally, doing a thorough housekeeping and ensuring that no object is hindering the footpath. If this is followed, least amount accidents will be witnessed.

Lifting

Yet again this is an additional major reason of accidents in places of work. Accidents that are resulted by lifting are more possible to take place amongst those staff members who have to take on manual management including pulling, pushing, lowering, lifting or carrying huge items on a customary basis. An injury can take place if the maneuver is not done in the approved manner or when an individual has not been shown how to perform the task as it should be in line with health and safety management course of action. People in this particular of environment should be well taught on how to perform these tasks appropriately in order to avoid injuries at work. In addition, the use of machinery should come to place in order to make their work easier when it comes to lifting of heavy objects, for example, the use of fork lifts

Falls

According to National Research Council (2012 p. 109), this kind of accident can consist of falling from stepladders or other platforms that are raised from the ground, for example, scaffolding. Injuries that are obtained from falling can array from slight strains or sprains to major back or head fractures and injuries. In this scenario, there is only one simple step that can keep individuals in the places of work safe, and that is simply them being watchful and careful

Workplace Traffic Accidents

These can take place in any place of work that makes full use of motorized vehicles like for example, in warehouses, and airports for that matter. Injuries can take place if the automobile that is being used, crashes or overturns or when items descend from it. The safety measures for this case are quite strict and should be followed in order to avoid such cases. As Ludwig and Ayres (2007 p. 89) suggests that the staff using the automobile, should acquire appropriate training on how to use the machinery, in terms of the required speed, maximum weight to be lifted (commonly in forklifts) and so on, because when it comes to automobiles, it is required that care and watchfulness should be the order of the duty.

Burns

Young and Wells (2011 p. 117) suggest that individuals who do their works in the kitchen, are not the only ones who can go through major or minor burn injuries, but even those perform electrical work are also capable of suffering from burns typically because of shock caused by electricity. The only safety measures to be put to practice in this situation, is the wearing of gloves at all times and never handling hot or naked wires with bare hands.

Neck and Back injuries

Despite the fact that working in an office can appear safe enough, having the same sitting position from time to time can occasionally result to neck and back injuries. According to Reese (2009 p. 113), this can take place if an individual is not in the appropriate sitting position, for instance, when the chair too low or high for the desk, no support of the back, when the computer too low so drooping over the desk. Getting the appropriate office furniture is the solution on top of sitting in the correct position, normally, 90 degrees and eyes straight to the screen.

Driving accidents – these take place to those individuals, who engage in driving as part of their work, for instance, taxi drivers, dispatch riders, sales rep, fast food delivery and so on. Following traffic rules is the only solution to avoid accidents, which is common sense.

Heavy apparatus – members of staff who work with heavy and plant apparatus for instance industries that deal with construction can put up with major work accidents. The use of machinery should be put to practice and weight balancing should also be put in mind to avoid accidents that are being caused doe to overload.

The RSI (Repetitive Strain Injury) – is mainly resulted by excessive use of the arms or hands to do a recurring job for so long without taking a break, for instance, factory work, typing, writing, driving, and so on. Taking a break is important n this case and this allows the body to coordinate well.

Problems with Vision– this injury can frequently take place to the individuals who make use of computers as their working toll on a daily basis. This injury is becoming the most widespread injury because of the frequent exploit of computers in the place of work.

PTSD (Post-Traumatic Stress Disorder) – according to Taylor (2005 p. 167), it is a type of a concern disorder that is able to arise after an individual has experienced or witnessed a shocking and disturbing event that drew in the risk of injury or death. Post-Traumatic Stress Disorder is more frequent in jobs of, for example, driving as one could possibly be involved in a dreadful car accident, or working in a business that may possibly be held up, for example, banks, post office or bookmakers.

Example of an Accident That Occurred

Not much time has passed since one of the mentioned accidents happened to one of the workers and sustained serious injuries that he obtained from burns caused by electric shock. The worker and his colleagues left their respective places of work late in the night and were headed for the engineering department where all the repairs are done. They normally hang out there as they catch up on old time stories, because apparently, they happened to be friends who were united together by the job that they were doing.

It rained heavily that night that the drainage system was becoming a nuisance, so the rain water flooded everywhere and water managed to find its way in the room. Peter accidentally dropped his phone and rushed to pick it up, but without knowing, he supported himself with the wall and his other hand reaching for the wet phone and got an electric shock that was caused by a naked cable that was being used for welding. The burns were so serious that his hand had to be amputated. Following this incident, the colleagues also developed PTSD (Post-Traumatic Stress Disorder) that made them to develop fear of that particular place for the reasons that, it reminds them of that incident.

In such cases, according to National Research Council (2012 p. 78), there are measures that if were put into practice, the occurrence would not have happened. The first thing that should have been done is making sure that all the apparatus that use electricity especially of high voltages, should have been properly checked, managed and repaired, for the reason that any naked wire can result to serious damage as experienced by the staff member. The second thing that should have been done, is ensuring that water drainage system should be regularly checked and corrections should be done upon being spotted, because apart from the shocking incident, water can make floors slippery hence casing someone to trip and fall, something that can bring about head, back or even spinal injuries, and as known, these are deadly injuries with severe results. Lastly, tools must never be left in the open, especially electric tools; they should be disconnected from any source of electricity and be stored and kept in dry places in order to reduce such cases.

References

Fuller, C., & Vassie, L. H. (2004). Health and safety management: principles and best practice. Harlow (Essex), Pearson Education.

Ludwig, D. A., & Ayres, M. (2007). Safety management systems for airports. Washington, D.C., Transportation Research Board. National Research Council (U.S.), Airport Cooperative Research Program, United States,

Ricondo & Associates, Planport GMBH., Two Hundred, Inc, & Flughafen Zürich.      (2012).Airport apron management and control programs. Washington, D.C., Transportation Research Board.

Reese, C. D. (2009). Occupational health and safety management: a practical approach. Boca   Raton, CRC Press.

Taylor, B. (2005). Effective Environmental, Health and Safety Management Using the Team Approach. Hoboken, John Wiley & Sons.

Young, S. B., & Wells, A. T. (2011). Airport planning and management. New York, McGraw-Hill Professional.

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Risk Management Alstom

Risk Management – A Case Study of Alstom

Risk Management at ALSTOM. The advantages of rail projects involve cheap shipment transport costs, increased in the mobility of passengers, greater economic addition and the environmental advantages from condensed road traffic or develop and improved urban transportation. But for the railways projects financiers needs to consider and keep in mind the risks factors that they can face throughout their projects and on the basis of that knowledge they should take some steps and start an awareness programs for those who relate to this project. Risks awareness programs should include the awareness about the hazards and controlled risks along with the steps that can reduce and almost decrease the risks which can be beneficial for the workers and for the rail projects as well.

Why the risk management department / function is an important function for a company

In the newly established private sector of railway, requests for contracts to offer railway services and rolling stick entirely relies on rewards and risk. Though ALSTOM has a massive share of market and substantial experience in the in business, each contract it creates divergence according to the specification of train, provisions of financing and spares, maintenance of various agreements (Quinn, & Strategy, 2013).

This consequently puts more stress on managers to obtain carefully whether every tender is value the risk and what the linked incentives are probably to be. From the suppliers of about two years British Rail will go to identify a short period of warranty after taking the train delivery. It will then renovate and maintain the trains, in addition to offer transport and rail services, like ticketing for passengers, facilities for station and maintenance of railway infrastructure. Financers are avoiding the risks of UK extreme environment and not having the feeling of urgency of Risk Management (Adger, 2010). And there is a lack of importance among firms that are being affected by the extreme weather.

And there is a lack of importance among firms that are being affected by the extreme weather. First of all we need to find out those steps that can reduce above discussed risks so that the railways project can be completed (Quinn, & Strategy, 2013). Investor should realize the risks of extreme environment that can affect the project.

ALSTOM refused the opportunity of business development in the secondary market. As an outcome, manufacturers of train like ALSTOM depend entirely on big contracts for manufacturing trains and experience from either scarcity or gorge that is they were either snowed under with commands and instructions or had to deny as commands rejects. Train manufacturing was a start or stop business and therefore each command was dissimilar, there were no retained technology and high capital cost.

To manage risk, ALSOTM was really concerned about it risk management department. And in order to manage the risk ALSTOM found a serious and vital change in focus for manufacturing  through moving from being merely a train manufacturer to a service provider. Late 1980s passenger transport were becoming more complicated system, integrating an increasing amount of equipment which are high value from suppliers which are specialist.

It was observed at ALSTOM that though these more complicated and sophisticated trains were a chance to increase and improve the product quality , the risk of late delivery and non-performance had raised. The main point was to incorporate the tasks of specialist suppliers so that those kind of risks can be easily managed (Reuter, Foerstl, Hartmann, & Blome, 2010).

Long Term cost risk for ALSTOM can be the major risk for the company. Now for a period of 20 years ALSTOM has a contract to supply their trains for the Northern Lines, it can no longer considers only of the manufacturing trains’ cost. As the company is not considering the long term cost of the company’s assets. So in ALSTOM ’s main interest is to maintain trains in immaculate circumstance and enhance and develop them throughout the lifetime of the company, if they continue this kind of attitude and apply risk management function this will lessen the cost of maintenance and generate more profits.

The project of Northern Line offered ALSTOM with major experience , not just in developing projects but also in capitalizing them. By taking the risk of asset for the scheme, ALSTOM unmitigated its rile as a train producer to act as a systematic stock firm. ALSTOM then went to the pecuniary markets to offer the capital for manufacturing the trains with capitalists who took the monetary risk for the project.

Assess how different departments/functions of a company such as ALSTOM can help the company manage its risks

The business strategy and the human resource management should be entirely incorporated so that they can effectively and efficiently play an active role within the risk management and its assessment. Whenever there is amalgamation activity, the Human Resource Department frequently has a huge responsibility to ensure that business operation transition go easily and smoothly. When firms amalgamate, some of the most important modification happens in treatment and in number of its workers. If in ALSTOM human resource department can successfully tackle with these significant matters, they can have massive effects on the success of the firm (Reuter, Foerstl, Hartmann, & Blome, 2010).

Major goal and role of ALSTOM is to establish and sustain trains until the end of era of franchise of Virgin. But the company is experiencing problem in maintain trains. The company is facing legal issues like accidents or suicides relating impostor, defect, and fire, electrical or mechanical failure caused by ALSTOM’s train or the company and especially workers’ strike which is due to the mismanagement of human resource, and it can cost a lot to ALSTOM.

The company hoped that they can carry on sustaining trains and can be able to manage their human resource after the franchise. Northern Line scheme’s financiers did not abridge risk whether it’s related to technicality or human resource mismanagement. Though the investors and the sponsors for the West Coast Main Line WCML project were signifying banks and other institutions of finance, are taking releasing risk, further than the date of primary franchise (Dimant, Lindner, Liu, Ruiz, & Tejpal, 2011). Till 2012, investors and sponsors have assured income flow from this project. But the risk comes after the year 2012, and the question raised that will the revenue generated for rest of the life of the advantages is enough to fund the financial make-up and produce a profit on the speculation of latest trains?

It is the sponsors and investors who having created the train manufacturing possible, who take the acclaim risk of supplying trains for the Virgin franchise (Narasimhan, & Talluri, 2009). Due to systematic finance management of ALSTOM the company was able to generate profit on the speculation of latest trains. But the major types of risks that must be consider by ALSTOM are strategic risk, for instance a competitor will going to pose serious threat on the business, compliance risk for instance the introduction of new safety and health rules and regulations, financial risk for instance increased interest rates or non-payment by customers charges on business credit, last is operational risks for instance theft or breakdown of main instrument.

How risks for a business such as Alstom are assessed

Assessment of risk is not about developing a massive amount of paperwork, but rather about recognizing appropriate measures to manage and control risks in the organization. Organizations like ALSTOM is already taking serious steps to guard its business operations and employees, but the company cannot deny the importance of risk management because it will aid ALSTOM to determine whether the company have covered all it requires to (Burstein, Sohal, Zyngier, & Sohal, 2010).

Think about how ill health and accidents could occur and focus on the actual risks, those that are most probably and will cause the most damage. For several risks, other rules need specific control actions. The risk assessment can facilitate ALSTOM to recognize where they require at assured and definite risk and these specific control measures in more specification. These control actions do not have to be examining separately but can be measured as an expansion of overall risk assessment.

Analysis of railway safety is very complex topic in ALSTOM where safety is indomitable by various elements including error of human. Many assessment of railway safety method currently employed are relatively mature instruments. In many situations the executions of those tools might not give suitable and adequate results because of the lack of safety risk information or the high level of vagueness and ambiguity present in the available safety risk data.

For many businesses, particularly ALSTOM, simple five step approach including all elements of risk would work efficiently (Narasimhan, & Talluri, 2009).

Identifying Risk

At ALSTOM looking for those factors at workplace that have the possibility to cause any kind of harm, and identifying employees who may be exposed to the dangers.

Evaluating and Prioritizing Risks

Evaluating the probability and the severity of the potential harm and the existing risks and prioritize them according to their classification of significance (Van Detta, 2013).

Deciding on Preventive Action

Identifying the suitable actions to control or eliminate the risks.

Taking Action

With the help of prioritization plan implementation of protective and preventive measures to eliminate the risk factors

Monitoring and Evaluation

The evaluation should be monitored at regular gaps to make sure that it stays up to date.

Risk Management
Risk Management

Evaluate approaches to managing risk

In business Enterprise risk management contains the procedures and the methods employed by the organization to manage and control risk and confiscate opportunities regarding to the attainment of their goals and objectives. It provides a framework for risk management, which naturally engross recognizing specific conditions or events related to the opportunities and risks of the organization, evaluating them in terms of magnitude and likelihood of impact, considering a strategy of response and progress observation (Wallin, Larsson, Isaksson, & Larsson, 2011).

COSO considers this ERM, incorporated framework fill up this requirement, and suppose it will become broadly adapted by the firms and other companies and meant all interested parties and stake holders. ERM’s incorporated framework extends on inner control, giving a more serious and widespread focus on the broader focus o ERM.

As it is not meant to and does not restore the inner control framework, but rather integrate the inner control framework within it, organizations might determine to look to this ERM framework both to satisfy their inner control requires and to move toward a risk management procedure.

Advantage

It is meant to aid promote new dialogue between senior executives and boards as they associate to more fully extend their resiliency of organization to risk and abilities of management to recognize opportunities to take appropriate risks for strategic and competitive benefits (Wallin, Larsson, Isaksson, & Larsson, 2011).

Disadvantages

As organization struggle to establish ERM procedure into models of more mature business operation, management and will require being tolerant. ERM should be observed as a long-term cultural modification as immediate achievement is exceptional. Unfortunately, no off the shelf explanations for firms looking to commence an effective and efficient enterprise, broad approach to risk management and lapse.

Analyze what causes various risks for Alstom transport

The P&O Nedlloyd Southampton encountered very rough climate in the Western advances to the English Channel. There was no proof that the transformer moved in stow on both ship but on entrance at the construction site of the power station at purpose, the transformer was found harmed to the degree of over 2 pound per meter (Reuter, Foerstl, Hartmann, & Blome, 2010). It had to be revisit to works of ASTLOM for repairs. ASTLOM was agreed that the harm to the transformer had been due to some strange and extraordinary event in the transit’s course and made a declaration under their insurance doctrine, which was entirely on the terms of all risks.

The insurers then believed that the harm to transformer resulted from the intrinsic incapability of the transformer to endure and survive and the common incidents of carriage by sea from United Kingdom to Malaysia throughout the cold seasons. They hence rejected the claim on the basis that the harm was caused by the intrinsic vice and then carried these proceedings looking for a statement that they were not accountable to cover ALSTOM under the doctrine.

The judge identifies that it was the general basis among the parties that directs the reasons for the harm to the transformer was the aggressive movement of the craft, specifically the Eliane Trader, due to the wind and sea actions. The action of wind and wavers obviously were a predictable incident of any journey and is therefore a danger to which all goods passed through sea are significantly exposed (Reuter, Foerstl, Hartmann, & Blome, 2010). Goods caring for shipment should therefore be able of enduring the forces that they can normally be normal to meet in the course of the journey and these might differ highly relying on the time and route.

According to the ASTLOM the employment of non-ASTLOM parts and sections without thorough design of industry and standards of safety, had caused in the sequence of failures in paths exchange machines, an unusual kind of structure and had resulted in the operational issues, together with a derailment of freight cars. ALSTOM warned against the integrated elements across all control system of trains.

Changes in government policies are also effecting the operations of the company. Increase in tax rates, duties on custom, import exports pricing policies are posing threats on the speed of business operations.

Risk Assessment Template

Risk Area

 Risk Identified

3- S

4- P

 Risk Impact 

Risk Severity
Non-ALSTOM Tools The particular risks linked with employing non-ALSTOM instrument are that it would need increasing the power level of device

8

9

 This is the high risk that can increase the probability for a single breakdown that could not save the system from noticing the trains on the track, which can cause accidents. The risk is high because it is harmful for the system, and it can cause severe accidents in present and future as well.
Safety of Railways In ALSTOM safety is indomitable by various elements including error of human.

10

8

 In many situations the executions of these tools might not give suitable and adequate results because of the lack of safety risk information or the high level of vagueness and ambiguity present in the available safety risk data. Again the severity is high because of human error and this can cost to the company a lot in future.

Identification and Assessment of the impact of risks: At ALSTOM looking for those factors at workplace that have the possibility to cause any kind of harm, and identifying employees who may be exposed to the dangers. It is very necessary to assess the impact of risk through evaluating the probability and the severity of the potential harm and the existing risks and prioritize them according to their classification of significance.

The Seriousness or Severity of the Risks: In October 2006 ALSTOM employee gave a verbal warning to another engineer of metro regarding the risks of combining instruments from various producers during a discussion. Illenberg said the particular risks linked with employing non-ALSTOM instrument are that it would need increasing the power level of device(Zavadskas, Turskis, & Tamošaitiene, 2010). This is the high risk that can increase the probability for a single breakdown that could not save the system from noticing the trains on the track, which can cause accidents.

Analyse the actions or strategies that Alstom can implement to manage the risks you have identified

All of the above risks can be controlled and managed. Well if talk about technical risks ALSTOM requires to consider few points that can develop the standards of technicality that can be very beneficial for the projects of railways, first of all the company should consider the importance of training its employees technically and conduct some sessions related to training sessions so that they can be able to technically equipped and skilled, and can be able to operate and construct the functions of the railway with the advanced and latest technologies (Zavadskas, Turskis, & Tamošaitiene, 2010). And for managing the economical and financial issues they require to have appropriate departments that can control, manage and reduce the economic and financial risks elements.

Analyse to what extent Alstom Transport, and other business, are vulnerable to major crisis

Due to extreme weather of UK, the temperatures become intolerable particularly in winters. But financiers are avoiding the risks of UK’s extreme environment and not having the feeling of urgency of Risk Management. And there is a lack of importance among firms that are being affected by the extreme weather. In the storm the winds most usually are strongest; even though they can arise at any time of year it can effects the projects which are underdeveloped and undersized. Other modes of transport are poorly effected by the UK’s extreme weather, it’s possibly the weather will be estimated extremely severe (Arena, Arnaboldi, & Azzone, 2010). The severe situations also stated that firms are going to consider extra claims in extraordinary situations.

Last but not the least heavy rain risks may affect the project. In winter there is a heavy rain in UK it all rely on the extent of rain that may be fail. Heavy rain can be the bigger hindrance in the completion of these rail projects. It becomes important for the financiers to take serious measures to handle these kinds of situations as all these factors are uncontrollable but we need to take those steps that can reduce the risks.

Control Risks involves technical, economic and financial, accidents, political and legal risks. All these factors can affect the railways project. While running the railway system technical standard are continuously coming across some problems. This might affect the railways projects. The distance need for the bridges cause more conflicts (Arena, Arnaboldi, & Azzone, 2010). Train accidents are increasing day by day due to miscommunication. The economic case for the ALSTOM railway comes out to be found on a supposition that there will be free movement of goods and people throughout the council area. The economic underpinnings for the line depend on continued economic growth and more trade between ALSTOM member states.

Critically evaluate in detail the approaches that Alstom Transport can use for crisis management and business continuity planning

First of all we need to find out those steps that can reduce above discussed risks so that the railways project can be completed. Investor should realize the risks of extreme environment that can affect the project. They should keep the gap between the railway tracks because in summers the tracks expand if there will be no proper gap between the tracks the train will be damage. Storms can increase the risks accidents (Renn, Klinke, & van Asselt, 2011). Because of storm and heavy snow fall the snow will cover the railway tracks and it will become difficult to drive over those tracks to avoid this kind of situation it is necessary to have air pumps in front of the train to blow the snow. Due to heavy rain in UK especially in winter season the aim to complete the project can be delayed. To handle this kind of situation there should have proper drainage system and canal system so that heavy rain cannot affect the ALSTOM railway project.

Control risks can be handling easily with having any kind of problem. Well if we will talk about technical risk we need to consider few steps that can increase the technical standards that can be beneficial for the railways project, first we should consider the urgency of training the workers technically and arrange some training sessions so that they can be technically skilled and equipped, and can be able to construct and operate the railway function with advance technologies. There are many rail projects which are on the ongoing stage and needs more financial investments to run the project smoothly. And for managing the financial and economical problems they need to have proper departments that can manage, reduces and control the financial and economic risks factors (Renn, Klinke, & van Asselt, 2011). Due to miscommunication lot of rail accidents have been occur to avoid this kind of problem they need to proper guide and train their workers how to communicate so that in future the risks of accidents can be reduce and almost vanished. Last is political and legal risk, for moving goods and passengers from railway is considering being free in future all over the council area but this needs a joint practices system for all states members to allow agree on a solitary point of entrance into the UK and have a similar tariff for the imported products.

Importance of Risk Management

Poor or lack of appropriate risk management strategies greatly affects the viability of any investment undertaken by anyone be it the government, a company or an individual business entity. In every investment that anyone undertakes, he or she must consider the issue of risk. Starting a business investment is taking a risk in itself. Time is what will tell if an investment will be successful or not. The future is uncertain and difficult to predict, due to this unavoidable fact, anyone starting a business venture has to come up with ways to mitigate risks involved in the business venture at hand.

Risk management can be defined as the process of identifying, analyzing and mitigating the uncertain state of any investment during the process of making decisions. Risk management comes to play whenever an investor tries to quantify the possibility or the potential for losses in an investment and then takes the necessary actions depending on his/her objectives in the investment and the nature of their investment’s risk tolerance potential (Satyajit, 36).

Poor risk management practices can cause severe consequences to any business entity be it a company or an individual business. A good example is the recession that began in 2008 which was caused by financial firms adopting loose credit risk management strategies. An investment without the consideration of risk management is like a vehicle travelling to no destination.

Research Findings

In my research of business risks and how to manage them, I came up with the different sources of business risks. A company cannot eliminate risk completely, but it can manage risk successfully. When it comes to financial issues, the management of a company has to make difficult decisions and choices pertaining the acceptable risk levels. If the risks are not acceptable and may yield losses then the management rules out the venture, but if the risk is acceptable and may yield high returns afterwards, they choose to undertake the venture at hand.

Successful risk management practice is based on the maintenance of a good balance between risks and rewards and ascertaining potential profits against potential threats in the operational stability of a business. Every company that operates any business venture must inevitably assume a certain level of risk so as to generate profits that will satisfy its stakeholders. Any business undertaking comes with some risks, the risks are diverse ranging from financial risks, risks from the market place and employee related risks (Satyajit, 56).

Risk management involves being aware of the potential risk and having an alternative plan to help deal with any problem that may arise in the course of an investment. A fitting illustration of this is when the management of a company realizes that the funds allocated to the company for a certain project will not be enough to complete the project. An appropriate risk management for the company will be having a backup financial plan that would fund the project and see its completion if the primary source of funding for the company is not willing to offer it additional credit.

The primary source of risk for a company is the market place that it operates in. It is very difficult to control the risks involved in the market and the best way to manage them is to directly deal with them in the best way possible. Among the major risks in the market is that the demand or preference of consumers may change over time, which would mean that the demand for a company’s product may decrease. Another risk can emerge when a competitor introduces a new product in the market that may be more desirable to the consumers than that of the company, or it may offer a competing product at a relatively low price and lure all the customers to consume its product. This poses to be a real danger to a company’s sales and it may adversely affect the operating profit of a company in a negative way.

Most risks in businesses emanate from financing and cash flow sectors. A company may fall short of finances when operating an expansion project or its customers may delay in paying their invoices in time creating delays which may disrupt the cash flow of a company. Also, the suppliers of a company may fail to supply or they may raise their prices all of a sudden with no prior notice creating cash flow problems to a company (Satyajit, 69).

Another major source of business risk is employee relations. Problems associated with labor pose a great impact to the production capabilities of a company. There are some personnel in the company that it cannot afford to lose and so it may incur increased wage costs so as to retain them. A company’s performance and profitability can dwindle due to the loss of important and essential personnel. This may happen when, for example, a key product designer moves to another competitive firm for a better pay.

A company may also have expanded its operations geographically to other countries; this means that it does business at international levels. Due to this, the company faces a variety of risks which include the risks of political problems. If a foreign country is politically unstable, it may bring a company’s operations to a standstill. Also, there may be changes in tariffs and the import/export laws may change thus affecting the company’s sales. The fluctuation of currency exchange rates may also pose a great risk to a company’s operations internationally.

The above mentioned risk sources affect every business entity and any investment that does not take into account the possibility of risk is suicidal. Poor risk management strategies have seen to the closure and collapse of many investments in the world. Just but to mention a few, about everyone knows about Hurricane Katrina and the destruction it brought to America. The government invests in protecting its citizens but in the case of the hurricane, poor risk management had been undertaken beforehand. Due to that, the hurricane caused unfathomable damage of property and loss of lives than anyone could comprehend. This were the results of poor risk management (Crouhy, 41). This is a catastrophic example of what poor risk management can cause.

Another good example of poor risk management strategy can be explained by Yahoo. It was the first company to offer mailing services to people using the internet in the world, due to this; it was charging people for the services it offered but not until the emergence of Google its greatest competitor. Google offered similar services but for free and so it attracted more customers than Yahoo. Yahoo did not see the risk of a competitor emerging and taking over its market share. Google is now the most used search engine in the world.

Knight Capital is another good example of a company that failed in its execution of a systematic risk management strategy in its undertaking. The company switched to a new software that it had not fully tested and entrusted all its undertaking to it without ascertaining the risks that may be involved. Upon putting its new software to the job, the company had recorded numerous erroneous trades in the New York Stock Exchange (NYSE). Even though the company immediately ceased its business transactions after realizing the problem, it had already committed itself to transactions worth billions of dollars. This resulted to an immediate pre-tax loss of more than 440 million US dollars. This financial company rushed for profits at the expense of risk management. If a financial company is pushing up technology and keeping its workforce on toes to extract the smallest value that is on offer in the ever competitive market, it should also make sure that its risk management systems keeps up with the same pace.

All companies in one way or another have faced risks and it all depends on how good their risk management skills are so as to pull trough. The following are the most common examples of risk management techniques that businesses employ so as to maneuver their way through risks.

Avoidance of risk- the easiest way that a business can manage risk is by avoiding it. This simply takes place when a business refuses to engage in any activity that it may perceive to carry any kind of risk. A good example of this is when a hospital avoids carrying out a procedure that involves a high degree of risk to the patient’s life. This method is simple in managing threats to a business entity but it also lowers the revenue potential of the business (Crouhy, 50).

Risk mitigation- some risks that businesses face is unavoidable and the only way to manage them is by trying to reduce their impact to the business. Risk mitigation is meant to lessen the negative consequence of a known risk to a business.

Transfer of risk- sometimes a business may choose to transfer risk away from itself. It does so by paying premiums to an insurance company in exchange for protection against any substantial loss. For example, a business may insure itself against fire so that in the event of any accidental fire that may cause financial loss, the insurance company will compensate it.

Risk acceptance- this is another way of managing risk in a business entity. A company may choose to accept a certain level of risk that may be brought about by a specific project if the expected profit is far much greater than the risk involved (Hopkin, 73).

Conclusion

I believe that risk management will become part of the management process of organizations in future. If the process of risk management had been put in place over the past two decades, a number of risks could not have taken place and more others could have been mitigated.

In the modern world, companies are beginning to see the advantages of protecting themselves against all types of potential risk exposures. By understanding risks, how severe and frequent they are; a company can now turn to viable solutions (Hopkin, 63).

From the research findings, it can be proven that poor or lack of appropriate risk management strategies greatly affects the viability of any kind of investment undertaken by anyone, be it the government, a company or an individual business entity. It is clearly evident that starting an investment without a clear plan on how to manage the risks involved will guarantee a very high chance of failure for the investment in question.

References

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