Posted: April 1st, 2022

Case Study One

Case Study One
A) Create an introductory section where you clearly DEFINE RISK.

B) Research and Pick ONE organization that can you conduct a risk assessment on.

C) Identify the potential risks found in the organization and for its ability to function in it’s chosen business vertical (i.e. government, financial, commercial, industrial, shipping& logistics, etc.).

Case Study One
A). Risk definition
Risk entails the uncertain outcome in an activity or an event concerning an aspect of value to people. A risk arises since one is not sure if engaging in an action or an activity will result in the addition or a decrease in value. Risks arise in cases where success or failure is dependent on different mitigating factors such that the engagement in an action or activity can result in failure or success (Heckmann, Comes and Nickel, 2015). In the case that the mitigating factors are in the interest of the action, then success is achieved, while if the mitigating factors are against the mitigating factors, failure is recorded. One will always expect success or increase in value for every activity and action they engage in, but at the same time, there are chances of recording failure or decrease of value in the same activity. Therefore, engaging in the activity expecting success is classified as a risk since they can either record success or failure in the activity. In increasing the chances of success in an activity or an action, then one must engage in it when the mitigating factors are inclined towards success. The decisions to engage in an action or not entails taking a risk since one can expect different outcomes.
B). Organization to conduct a risk assessment
MacDonald’s is one organization that I can effectively conduct a risk analysis to identify the risks likely to affect the organization. Risk assessment entails the process and methods establishing risks and hazards that can result in potential harm or negative impacts in an organization in the event that they occur (Torabi, Giahi, and Sahebjamnia, 2016). MacDonald’s is an American fast food business/ restaurant; thus, it is prone to different kinds of risks that can affect business operations. Macdonald operates in a business environment with different mitigating factors that determine the success or failures of the business. MacDonald’s earns its revenue rental payments realized in the franchises. The different franchised engage in the sale of fast-food in their different jurisdiction, and their operations are affected by the forces of demand and supply. The different fast foods sold in the different MacDonald’s outlets include French fries, soft drinks, cheeseburgers, desserts, wraps, and milkshakes. Additionally, the business has engaged in the sale of foods considered to be healthy such as fruits, salads, smoothies, and fish meat. The engagement of the different operations can result in failure or success determined by the risk levels.
C). Potential risks
The profitability of McDonald’s is dependent on the implementation of the strategic plan that is based on an execution risk. This means that the execution of the plan can result in either profit or losses. The execution of the plan determines if the company remains to be profitable through upholding its brand. The different risks arising from the execution of the plans include the impact of marketing, pricing and promotional plans on the margins and sales, plans to motivate employees to offer exceptional services thus improving customer perception, the plans to rebuilding and re-imaging the brand and restaurant to attract customers, and the change of menu to achieve success in attracting customers. Engaging in the different strategic plans results in uncertainty on whether the business will realize success or failure from them.
The ability to function and operate business vertically with associates is a risk. MacDonald’s needs to ensure that it’s business relations with other businesses or organizations are effective and efficient in the interest of attaining sustainable development. The maintenance of vertical businesses relation and interactions such as government, financial institution, and suppliers is a risk that needs to be approached and handled with caution.

References
Heckmann, I., Comes, T., & Nickel, S. (2015). A critical review on supply chain risk–Definition, measure and modeling. Omega, 52, 119-132.
Khandelwal R. (2019). McDonald’s Risks, Strengths, and Weaknesses. Market Realist.
Torabi, S. A., Giahi, R., & Sahebjamnia, N. (2016). An enhanced risk assessment framework for business continuity management systems. Safety science, 89, 201-218.

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