Management Research Paper on Risk Management

Risk Management


MacVille Pty Limited has come up with a chain of cafes in the central business district of Brisbane, Queensland, NSW and Sydney. In Queensland, an existing café known as Hurley’s café which is located in Toowoomba will be purchased and rebranded. This decision has been reached after deliberation by the Board of directors of the company. Hurley’s café is located 130kilometeres West of Brisbane. As the current risk manager of the flagship Brisbane Queen store, I have been mandated with the task of managing the new Toowoomba store. This report will detail the risks and operational tasks that will be involves with the Toowoomba café takeover and management from my risk manager’s point of view. The report will be submitted to Paula Kinski; who is the CEO for MacVille’s cafes in Queensland. According to the CEO Paula Kinski, the establishing of the new café will involve three major stages which will include reviewing, analyzing and planning, and monitoring the progress of the risk management plan. The board of directors has already examined and made a decision on the investment and strategic risks of the Toowoomba café initiative. The board would like information on how the business risks can impact several aspects of the business such as human resources, supply chain, OHS and compliance, governance, supply chain and finance related matters of the project. The Toowoomba café staff will be hired on a three months’ probation period, and the current supervisor; Mr. James Mansfield has already accepted the position of assistant manager at the new café. Key stakeholders and business partners have cooperated and are willing to assist where they can so as to further the agenda and success of MacVille organization’s success as a whole, and the establishment of the Toowoomba café.


The MacVille café has the goal of establishing itself as a profitable business both in the short run and in the long run. This profitability will be established by ensuring efficiency of all aspects of the business; financial, human resources, operations and facilities organization.

The location of the MacVille café in Toowoomba offers an opportunity for the business to cater to a market niche that is usually neglected in the hospitality industry. The location of the café is far from the central business district, but it is surrounded by institutions with students, employees and residents of the area. There is also a high population of retirees for who some products can be tailored for them. There are several goals that the management of the company will have to use in order to return on investment using the available resources within the shortest possible timeline (Humphrey, 2005).

Water is one of the most essential products that are required as an input for the café to succeed. Ron Langford who is the landlord of the facility states that the council would fine any facility that would exceed the set limit. The fines that can be imposed by the federal government go up to $ 50,000. In order to avoid this fine, the café will install a water tank so that it has sufficient amount of water to run the facility. One of the key goals is therefore getting a water tank that can trap water during the rainy season and be used to water the plants at the facility and be used for the dual flashing systems for the bathrooms. This provision is necessary especially with the expected increase in the number of clients after publicizing and marketing the facility to new and existing clients.

Ron also informed the café of the by law that would allow cafes to extend their facility into the footpath so as to cater to a higher number of clients. MacVille Café will take advantage of this offer and expand so as to cater to a higher number of clients at any time of the day and year.

In the near future, depending on the success of the MacVille café in Toowoomba, the café will explore opening up of a new café at the Kmart Plaza and Clifford Gardens. The actual execution of this plan will depend on the success and profitability of the current MacVille café.


Stakeholder Internal/ External Role in process Issues & Concerns
Suppliers external Provision of products needed to serve clients Location is too far from facility
Banking services provider External Provision of money storage and credit facilities Hurley’s family bank account was located far from the café facility
employees internal Provision of high quality services to clients Lack of clearly laid down human resources policies.
Ron Langford external Provision of information on town council requirements The fines on water usage by the town council


An external business environmental analysis is necessary for a company to gauge the fundamental elements that it has to deal with. A PEST analysis seeks to identify the strategic decisions that can be maximized on, the available opportunities, risks, trends and future uncertainties that the business should prepare for.

Political factors

The current Australian political environment is calm and favorable for business. Before and during 2013, most of the businesses were not willing to spend funds because of the uncertainty related to the elections. However, after the elections, most businesses injected cash to revamp their businesses which resulted in a better performance of the industry. The mining industry has picked up this year (2014) and more industries have been expected to do the same as government spending increases with the intention of encouraging consumers to go out and spend and contribute to a higher level of investments and employment levels, which would in turn increase the amount of money in circulation (Gumpta, 2013).

Economic Factors

The Australian economy has improved by over 14 % since the 2008 global economic recession (Mason, 2012). The export market in the country grew by high demands mainly because of a greater demand that originated from the Chinese market especially for coal metals. A growth in the service industry employment was also witnessed facilitated by a growth in tourism numbers. A growth in the transport sector was also witnessed; mainly necessitated by a growth in the manufacturing industry. The labor market has also witnessed a steady growth over the years especially in areas such as New South Wales and Queensland.

A hospitality industry business requires a direct distribution channel whereby the farmer directly supplies his produce to the café owner. Such a distribution channel allows the café to make higher profits since it takes advantage of economies of scale, while the products are still delivered while still fresh. The farmer in turn gets a constant and consistent order to supply to which offers convenience in terms of delivery and payment. In this particular case, the MacVille café management has a duty to ensure the creation of a long term relationship between the business and its suppliers. A long term mutual relationship between the café and its suppliers can lead to credit extension periods and timely transfer of useful information between the two parties (Mason, 2012).

Social Factors

The location of the café offers an opportunity of attracting a high number of clients because many institutions of higher learning and religion are located in the area. Some important annual events are also held at Toowoomba including the Easterfest occasion during the Easter period (Langmore, 2007). The flower Carnival which is an event where flowers are showcased is another important annual event held every September in the town. Toowoomba is the capital city of the Darling Downs which makes it a good location for the MacVille café. Toowoomba is also second largest in position after Canberra terms of population which means that there are many potential clients in the area. The MacVille café will participate in any exhibitions that will be held in the area. The management of the new café will plan on making periodical visits to the town council office so as to get any information about exhibitions or any meetings being organized for businesses in the area.


The field of technology has continued to grow and evolve over time and the Australian arm of the field has not been left behind. Competition among companies that offer information technology and systems services has resulted in the offering of higher bandwidth internet services at lower prices. Fast and reliable internet services are an essential part of business in this day and age where consumers are technology savvy (Jonnes, 2010). The Australian Government Information Management Office (AGIMO) supports the development and extensive use of information and communications technology in Australia.

The Federal Government is planning on rolling out the National Broadband Network in the area of Toowoomba. This facility will allow business and individuals to be able to access and make video calls and be able to teleconference with their colleagues.

SWOT Analysis


  • The new MacVille Café at Toowoomba will retain the employees that had been employed at Hurley’s café which was a family business. The staff will therefore have no difficulty adapting to the new workplace as would be expected with a new facility such as reporting and moving to a new workplace. Furthermore, most of the staff already has an established client base and their tastes and preferences.
  • The location of the MacVille café away from the central business district offers a getaway from individuals that would want to get away from the noise and bustle of the city, and instead experience a serene environment with friendly service.
  • MacVille café is also located near many institutions such as local council offices and universities and colleges. This offers the café a large pool of clients to tap from. The staff at the café should be encouraged to be friendly such as asking the clients their names and remembering what they like so that they feel that they get a personalized service. All clients like to feel important, and the clients at Toowoomba will not be an exception.
  • The cafe offers a gourmet product as one of the listings in the menu which is a delicacy and it is not offered anywhere else in the surrounding outlets. All clients should be informed of this dish and encouraged to try it out as a way of increasing the number of loyal clients at the café. Those who have tried the product already cite it as being a menu item that they enjoy.


  • The MacVille Café in Toowoomba is located two hours away from the premises where deliveries should be made from. There is high likelihood that the supplies might not reach the premises on time especially in comparison to the other company outlets which are located near the central business district of their respective towns (Hein, 2008). The two hours delay in delivery of pastries makes the distance and choice of suppliers a big concern since most of these products are meant for the early morning clients. Failure of clients to get the pastries in the early morning might make them go to competing outlets and it would prove difficult to attract them back to the MacVille café outlet. The MacVille Café is located far away from Brisbane which is the location where managers from other company outlets meet to deliberate on issues affecting the company outlets.
  • There are also upcoming training sessions that are expected to take place over the next six months. Missing the meetings is not an option since the managers need to be in the know on the strategies that the company intends on using so as to stay ahead from the competition in the market.


The Federal Government through the National Broadband Network plans on rolling out broad bandwidth internet services in the area. provision of the facility will mean that the café can cut back on travelling costs for the manager so that he/ she does not have to take a 2 hour drive to and from the facility to Brisbane for the meetings and training sessions. The national Broadband Network services will allow businesses and individuals to make video calls and take advantage of teleconferencing services.

The New MacVille Café at Toowoomba should offer free wifi services so as to attract as many new young clients as possible. This added feature will be an added benefit for the loyal clients of the company.  The provision of free wifi would best be accompanied by an addition of outdoor seats and a creation of a soothing ambience to encourage as many of the student population numbers to come and visit the café. To minimize the number of individuals that would only come to the café to sit and enjoy the free wifi services, there will be notices on the requirement to order from the menu if clients are to be given the free wifi password which will be changed regularly such as fortnightly (Kropf, 2009).

 There will be increased and better record keeping with the goal of increasing responsibility and accountability. The café will consider changing banking facilities to the one that is located near the facility. In the past, there has been failure to bank money due to the distant location of the café’s bank. An increase in the frequency of banking will improve the chances of the café getting credit facilities in case they are ever needed.

The café will advertise the addition of this facility on its website and include it on the café’s social media pages. A high number of clients have active social media accounts which they use to find out about new services that are located near their areas of residence or nearby facilities that they attend such as universities and colleges (Sessons, 2014: Ibidunni,  Iyiola & Dirisu, 2013).

The MacVille café also has an opportunity to attract a high number of retirees that live around the area. An improvement in ambience of the café will contribute to an increase in the number of clients from this group that are attracted and maintained. There are many buses that frequent the area and the retirees would not have to walk for long before they can get to the café.


The far location of the café makes it less competitive in comparison to other cafes that are located at the central business district which is where most individuals conduct their business (Harris, 2011). The MacVille café faces threats from new cafes that might come up in the area which would reduce the number of new clients that would visit the café. The level of threat might especially be high if a competitor was to introduce their products with lower prices than those that were being offered by the MacVille café, and a wider range of products on the menu in comparison to those of the café.

Risk management summary

Risk Description priorities Options for Control/ treating methods Monitoring methods Timelines Likelihood/ Consequences Person responsible
Theft A priority Installing a safe at the premises More responsibility for the supervisor 3 months Better accounting and storage of money Supervisor
Facilities breakdown Priority Purchase of new seats Revolving responsibility to employees according to roster 3 months Minimal likelihood of clients getting injured at the premises Risk manager
OHS and safety laws High priority Establishing and maintenance of required compliance laws All employees in the café will be retrained 1 month Reduction of chances of café getting fined and closed down for violation of safety laws Risk manager
Industrial and privacy laws High priority Training of employees on industrial and privacy laws compliance Regular and random assessment of employees knowledge on the laws to ensure full compliance of the cafe 2 months Reduction of likelihood of being fined by the local council for beach of industrial and privacy laws Risk manager


The MacVille Café report has successfully looked at the goals of the establishment which should be executed in both the short term and in the long terms so as to achieve success within the shortest time possible efficiently. The report has also looked at the strengths, weaknesses, opportunities and threats of the café that should be looked into so as to maximize business opportunities. The café has the advantage that it already has human resources who used to work under Hurley’s café before it was acquired by the MacVille Café business. However, the café does not have clear laid down human policies, industry and privacy regulations and health safety regulations. The management should ensure that all the human resources are trained on the regulations that will improve safety, business competitive level and services offered to clients. The introduction of broad bandwidth internet services by the federal government in the area of Toowoomba stands to benefit the business through provision of high quality video conferencing and internet services to the café. Handling of the existing risks at the MacVille café at Toowoomba will contribute to high profitability and efficiency in the manner in which human resources and financial operations of the business are run.


  1. Research for risk related issues
  2. Forecasting using past results: a company can use its past performance to decide how well or not it can perform on certain tasks that it plans on executing in the organization.
  3. Market survey from related companies; the company can conduct surveys based on similar companies that are in the industry. Most of the companies in the industry would not be willing to divulge all their information, but the minimal given would be sufficient to form basis for a research study (Hopkin, 2012).
  4. Interviewing top management: the top management of the company is in the best possible position to give information on how the company is performing since they deal with the various parameters of the organization frequently.
  5. Checklists and brainstorming are both tools that can be used in risk management. Describe each of these and when they would best be used.
  6. Checklists provide a means through which risk management can be assessed and better techniques of managing it devised. A checklist can be used to detect the best available evacuation plan an organization has in place.
  7. Brainstorming allows people to give ideas on what they feel would be the best way forward as a means of tackling risks the organization encounters. It would best be used when managers and executives are giving ideas on the best way of tackling risks faced by the company(Hopkin, 2012).
  8. Legislation affecting MacVille café
  9. Privacy law/ act

The privacy law/ act can potentially affect MacVille café. It acts as a guide to organizations on the private employee and client information that they can collect, and what they can/ cannot do with it.

  1. OHS regulations

Occupational Health Safety regulations can affect MacVille café since the company has a legal duty to ensure employees are safe and the company is liable for diseases and injury that might result from the employees working at the company (Hopkin, 2012).

  1. Contract law

MacVille café is affected by contract law depending on the legal agreements that are made by the company and its consumers and other stakeholders such as suppliers. The café has a legal responsibility to honor the different contracts or else be held legally liable 9Hopkin, 2012).

  1. Name and give an example of 3 adjustments that can be made in the workplace to assist a person with disability.

Job redesign: a position’s duties can be modified to suit those that would conveniently be executed by an employee with disability such as adding the duty of making calls to suppliers for a cashier so as to limit physical movement.

Equipment modification: a company can repurchase better chairs which are fitted for people with disability at the office so as to increase physical comfort which would in turn improve morale and productivity (Harris, 2011).

Modifying working schedule: such as starting work late and finishing late depending on convenience for a disabled person so as to ease their discomfort.

  1. List 2 types of insurance an organization can consider purchasing, and for each type, describe the risks covered by the insurance and the benefit to the organization
  2. Fire insurance: on the unfortunate occasion that a fire might arise, a company would be compensated for the loss and therefore reduce the chances of the organization going bankrupt if a fire was to burn down the premises.
  3. Theft insurance: this type of insurance would cover the company if items at the premises were to be stolen. This would provide the business with continuity even if thieves were to steal essential items like cash, the cash register machine, chairs and café equipment.
  4. Provide at least 3 examples of how the AS/NZS ISO31000:2009 provide guidance for managing risk
  5. AS/NZS ISO31000:2009 requires that organizations provide uniformity so that the provided information can be understood and used by professionals in the field.
  6. The standards enables individuals to avoid risks since there are available tools as to how an organization can recognize risks they face or will face in the near future.
  7. The standards enable companies to be able to change risks and their outcomes in both the short and long run using the guidelines given (Hopkin, 2012).


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