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A Technical
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Program
DIPLOMA IN
SKILLS FOR BUSINESS
NCFE LEVEL 3
Learner
Business Fundamentals Booklet
II Learner Booklet
Business Fundamentals II
1
© 2017 Higher Colleges of Technology, Vocational Studies Unit, Abu Dhabi, United Arab Emirates. All
rights reserved.
This material is reproduced and distributed with the permission of HCT for educational purposes. No
other use is permitted without permission. In addition, this material may not be reproduced, displayed,
modified or distributed externally of HCT without the express prior written permission of the copyright
holder.
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Contents
Unit Standard ............................................................................................................................... 6
Sustainability in a business environment ....................................................................................... 8
Areas that a business needs to consider improving sustainability .................................................. 9
Importance of having a sustainability strategy............................................................................... 9
Benefits of having a sustainability strategy .................................................................................. 10
What is waste and how to reduce it? ........................................................................................... 10
Waste prevention techniques – The 4 Rs ..................................................................................... 11
Recycling and how reycling improves sustainability ? .................................................................. 11
Why do we need to have a procedure to recycle waste material? ................................................ 14
What should the recycling procedure cover? ............................................................................... 14
Waste Disposal Procedure........................................................................................................... 15
UAE Waste Problem .................................................................................................................... 15
What is Waste Audit?.................................................................................................................. 16
The Purpose of Waste Audit ........................................................................................................ 16
Elements of a Simple Procedure for Waste Disposal .................................................................... 16
Maintaining Equipment............................................................................................................... 17
What is an Equipment Maintenance Procedure? ......................................................................... 17
What should a Maintenance Procedure Include? ......................................................................... 18
What to Consider When Developing an Equipment Maintenance Procedure? .............................. 18
Revision and Formative Activity .......................................................... Error! Bookmark not defined.
Waste Reduction......................................................................................................................... 19
Some Ways to Reduce Waste ...................................................................................................... 19
Waste Reduction Audit ............................................................................................................... 20
Waste Reduction Projects ........................................................................................................... 20
Evaluation of a Waste Reduction Project ..................................................................................... 20
Barriers that might impede a successful implementation of waste reduction project ................... 21
Evaluation of a Waste Reduction Project ..................................................................................... 22
Evaluation Steps ......................................................................................................................... 22
Diversity ..................................................................................................................................... 23
Diversity characteristics .............................................................................................................. 23
Equality ...................................................................................................................................... 25
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Inclusion ..................................................................................................................................... 25
A Diverse Workforce ................................................................................................................... 26
Benefits of Having a Diverse Workforce....................................................................................... 26
What Helps People Feel Respected in a Diverse Workforce? ........................................................ 27
How can you Promote Diversity?................................................................................................. 28
Reasons to Promote Diversity in a Workplace ............................................................................. 28
How can an Organisation Promote Diversity in a Workplace? ...................................................... 29
UAE Diversity Legislation............................................................................................................. 30
UAE Equal Opportunities and Diversity Policy .............................................................................. 31
Security and Confidentiality ........................................................................................................ 31
Consequences of breaching confidentiality .................................................................................. 32
UAE Constitution Article 31- Right to Privacy ............................................................................... 32
Keeping Business Property Safe................................................................................................... 33
Business Security Procedures ...................................................................................................... 33
UAE Fire and Safety Code of Practice 2017 .................................................................................. 34
Keeping Information Secure and Confidential .............................................................................. 34
UAE Data Protection ................................................................................................................... 34
Cybercrime Law .......................................................................................................................... 35
Possible Risks to a Business Data ................................................................................................. 35
Securing a Breach of Electronic Information ................................................................................ 36
Keeping Information Confidential ............................................................................................... 37
Guidelines for Dealing with Confidential Information .................................................................. 37
Purpose of Confidentiality Policies .............................................................................................. 38
Business consequences of Confidentiality Breaching ................................................................... 38
Legal Consequences of Confidentiality Breaching ........................................................................ 38
Confidentiality Breaching Consequences for Employees .............................................................. 39
What is Risk? .............................................................................................................................. 39
Potential risks in a business environment .................................................................................... 40
Risk Identification (Video Script) ................................................................................................. 40
Risk Identification Definition ....................................................................................................... 41
Ways to Identify Risks ................................................................................................................. 41
Sources of internal risk for a business .......................................................................................... 42
SWOT Analysis ............................................................................................................................ 43
What is a Hazard? How is it different from a Risk? ....................................................................... 44
Risk Assessment and Management ............................................................................................. 45
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Benefits of Carrying out a Risk Assessment .................................................................................. 46
Common Risks in the Workplace ................................................................................................. 46
Top 5 Business Risks .................................................................................................................... 48
A hazard Impact and Likelihood .................................................................................................. 49
Solutions minimise the Impact and Likelihood of the Top 5 Business Risks ................................... 49
References .................................................................................................................................. 50
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Unit Standard
NCFE Credits 10
2.
UNIT DESCRIPTION
4. The Business Fundamentals II Unit provides the student with an
overview of the basic business skills, knowledge and understanding
needed in the modern workplace. By the end of this Unit the student
will have an understanding of the essential skills required to work
successfully in a business environment, the skills required to solve
problems in a business environment, and an understanding of
business culture and responsibilities. This Unit also provides an
introduction to the specialization pathways that follow.
1 Will be able to improve 1.1. Analyse the benefits of keeping waste to a minimum.
sustainability within a 1.2. Follow agreed procedures for:
business environment. Recycling
Disposing of waste
Maintaining equipment.
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3 3.1. Explain why security and confidentiality are important in a business
Will be able to maintain
environment.
security and confidentiality in
a business environment. 3.2. Ensure that property is kept secure in line with organizational
procedures and legal requirements.
3.3. Ensure that information is kept secure and confidential in line with
organizational procedures and legal requirements.
4.4. Identify ways to minimize the impact and likelihood of the risk.
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Sustainability in a business environment
In this unit, you will look at how businesses can be more sustainable today and for the future.
You will consider how sustainability can be influenced by recycling and waste disposal and
the importance of ensuring that equipment is properly maintained. Furthermore, you will see
how sustainability affects business profits, the environment and society.
Image 1: Sustainability
Image 2: 3Ps
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Areas that a business needs to consider improving sustainability
Some of the areas that a business needs to consider to be able to improve its sustainability
include:
- Think about how the business is using the natural resources: try to reduce the use of
energy, water, and natural materials. Try to use recycled material.
- Save energy: try to use technologies that optimise the use of resources. For example,
introduce energy saving bulbs.
- Try to reduce carbon emissions: the more carbon dioxide a business produces, the
more air pollution it causes. A business should always look for solutions to decrease
its carbon dioxide emissions. For example: use recycled materials, create a recycling
program to decrease paper use, encourage staff to use public transportation, use the
most energy-efficient models for your fleet of vehicles, etc.
- Reduce waste: reducing waste can help a business save money, since the company
will end up with less waste to dispose of. We can reduce waste by implementing some
initiatives such as: reducing packaging, going paperless, eliminating bottled water,
etc.…
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It is good practice for all businesses whatever their size, to have a sustainability strategy or
an environmental management system. This will help:
It is worth noting that such strategies or systems should be led from the top of the
organisation.
Reduces costs
An important feature of any sustainability strategy is how a business deals with its waste.
Waste is any material that is discarded after its primary use or is defective or has no further
use.
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Businesses nowadays aim at waste minimisation. Waste
minimisation essentially aims at reducing the amount of waste
produced and minimising the amount that needs to be treated
or disposed of.
Image 3: Waste
Recycling
Recycling is converting waste material into raw material that can be shaped into new
objects.
Recycling is one of the most commonly used waste minimisation strategies used by
businesses because of its many benefits:
Easy to implement: one of the most important reasons for the widespread use of
recycling as a waste minimisation strategy is its practicality. Recycling is a simple way
in which every person can contribute to decreasing waste and protecting the
environment.
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Reduces the amount of waste to landfill: recycling is widely promoted, because it
reduces strain on the environment. By recycling, we use waste products in a
constructive way and thus eventually shrink the size of our landfills and keep pollution
in check.
Can reduce disposal costs: recycling means less waste and therefore less disposal
costs.
Reduces overall need for natural raw materials: when we transform waste into raw
material, we decrease the need of purchasing or extracting new resources (iron, fossil
fuels, etc.…)
Image 5: Recycling
Recycling is part of the business’s commitment to sustainability. Within any business that is
committed to recycling there will be set procedures to ensure that all recyclable material is
collected separately and stored ready for collection.
The procedures to achieve recycling targets must be led by the person at the top of the
organisation. Also, all employees need to understand why such procedures are being
introduced. If they understand how recycling supports sustainability, they are more likely to
follow the procedures.
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It is worth noting, however, that recycling entails the use of additional energy and resources,
and therefore, can be less beneficial to the environment and more expensive than other
solutions like reducing and reusing.
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Why do we need to have a procedure to recycle waste material?
A procedure is a sequence of activities or actions that are followed to ensure that a task is
correctly performed or an outcome achieved. For a business to ensure commitment to
sustainability, it should start by defining proper procedures. This will:
1. Ensure that everyone understands what they need to do with their recyclable
material
2. Ensure that it delivers the organisations commitment to recycling
3. Maintain good quality of recyclable material
6. Allow accurate data to be collected about how much recyclable material is collected
2. Clear communication to everyone about the procedure, and why it is being introduced
(part of a sustainability strategy, to achieve recycling targets, to make financial
savings).
5. Nominate someone to organise the procedure and monitor when containers need
emptying
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Waste Disposal Procedure
Waste is generated daily, and if not collected and disposed of, it will create a storage
problem with a risk to human health and the environment. Businesses have a duty of care
to ensure that their waste is collected by licenced contractors and taken to authorised
disposal facilities. Disposing of waste to landfill should be a short- term option, but may still
form part of the businesses sustainability strategy.
A procedure will ensure that the waste is stored, transported and disposed of responsibly. A
waste disposal procedure will:
The UAE has a massive waste problem as a developing country, and it needs to have strategies
in place to handle the growing amount of waste. The following facts gives you an idea of the
problem:
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The UAE government is aware of this problem and is aiming by 2030 not to have to put any
waste in landfill sites as this is the least sustainable option for disposing of waste.
Image 6: Audit
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Ensure that all waste types are collected frequently enough by an authorised
contractor to avoid unnecessary storage of waste.
Only trained staff should handle waste and should wear the appropriate protective
equipment.
Maintaining Equipment
Remember that equipment is, ‘any machine, tools or clothing’ that has a specific purpose,
and is necessary for the operation of the businesses’. So why does equipment need to be
maintained?
Regular maintenance of equipment will guarantee that our equipment (and thus one
of our primary means of production) is available 100% of the time.
Routine maintenance can identify minor problems and prevent them from becoming
major problems. It can as well identify wearing parts and operator damage.
Routine maintenance is often required to maintain manufacturers' warranties and
guarantees.
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What should a Maintenance Procedure Include?
Detailed records of the maintenance are kept, such as dates, details of work carried
out and inspections.
Any repairs are carried out quickly and before the equipment is used.
Manufacture’s recommendations.
How often the equipment is used.
The environment that the equipment is used in, for example, hot dusty conditions.
Who will be using the equipment and what experience have they got.
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Waste Reduction
In this session, you will be looking more closely at waste reduction/ minimisation and ways
in which a business can reduce the amount of waste that it produces. Waste minimisation
should be a main focus of a business’s sustainability strategy.
Remember, waste minimisation is about a business reducing the amount of waste that it
produces and potentially puts into the environment, the main elements being solid waste,
waste water and carbon dioxide emissions.
When aiming to minimise waste, the emphasis should be on reducing the use of resources
and energy in the manufacturing process or the delivery of services. The process includes:
Reduce energy consumption - turn electrical equipment off overnight and do not leave
on standby.
Reuse waste – cardboard boxes can be reused for dispatching items or storage.
Recycling – recycle office paper.
Repair –defective office furniture can usually be repaired and is cheaper than
purchasing new furniture.
Use electronic communications instead of paper.
Use reusable mugs instead of disposable plastic.
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Remember that the starting point for a business to identify ways to reduce waste is to carry
out a waste reduction audit.
This information provides the basis for a business to develop its waste reduction programme,
improving waste management practices and helping to procure cost effective waste disposal
contracts.
Ask for ideas and suggestions – It is important to ensure that the staff are engaged
and involved.
Ask for feedback on the suggestion – gives an opportunity to build upon existing ideas.
Implement the suggestion.
Feedback on the results of the project.
Evaluate the impact of the change.
Celebrate success.
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The evaluation of a new waste reduction initiative should
be done under three broad headings:
Some initiatives are easy to introduce, such as recycling, as it does not really require
much thought from people. However, initiatives where employees would not be able
to see direct results, are less likely to be successful. For example, getting staff to turn
off computers overnight. It might be difficult to the staff to think of how saving this
energy would result in less carbon emissions, which would eventually benefit the
environment.
Cost is always a major factor. In terms of waste disposal, the cheapest option is always
the most attractive one, although not necessarily the cheapest long-term solution.
‘landfills’ is an example of this.
Some reuse initiatives are hard to implement, as staff find it hard to accept what they
see as second-hand items, and believe everything should be new.
Recycling initiatives will be much easier to implement than those requiring a change
in behaviour, such as energy conservation.
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Summary – waste reduction should be a key element of a business’s sustainability strategy
and focus on ways to reduce the use of resources and energy during the manufacturing and
the delivery of services.
Remember, the ways of measuring a waste reduction project are looking at:
Evaluation Steps
Remember - Waste reduction audit – a simple audit that will identify all processes in the
business that generate waste. It will identify the waste types
and a range of waste reduction options. The audit process will Audit
require all this information to be documented for future
comparisons. (IE the amount of waste that is reduced in kg,
number of people implementing the waste reduction
suggestion). Conclusion Evaluation
Conclusion - the comparison of the data will determine whether the initiative has been
successful, if targets or outcomes have been achieved and whether to continue with the
initiative
Diversity
Diversity characteristics
If you think about the differences/diversity of the people in a workplace, you will notice that
diversity falls into the broad categories of:
1
Making use of
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• Biology – this determines how we look, height, colour of skin, hair eyes, physical
ability, sexual orientation.
• Religion/Beliefs – this can be our deep
religious beliefs or simply a belief in
the philosophy of life.
• Ethnicity – people from the same
backgrounds share the same customs,
culture, language, and identity.
• Geography – where we live, in the city
or countryside, the neighbourhood. Image 12: Diversity Characteristics
• Experience – what our life experiences are: school, home, work travel, mixing with
other people.
• Family life – influenced by family size, family values, traditions and social class.
The UAE is keen to promote diversity, and has resulted in attracting talent from all over the world.
This has made a great positive contribution to its economy.
A business with a diverse workforce should ensure that all employees are treated equally and
fairly and given the same opportunities. For example, training, personal development,
promotion and pay.
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Equality
Like diversity, equality is an important aspect of human rights. Equality is about ensuring
that every individual has an equal opportunity to realise his/her full potential. Thus, no one
should be disadvantaged because of what or who they are, what they believe in or whether
they have a disability.
Some of the characteristics that might be the focus of discrimination and which can be a
reason why some individuals in a workplace are disadvantaged or deprived of equal rights
are:
• Race
• Disability
• Gender
Inclusion
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In a business environment, diversity is recognising the mix of people, and inclusion is the
success of making that mix of people work well to achieve maximum benefit for the individual
and the business. Thus, inclusion compliments diversity and equality as basic human rights.
To achieve the positive results of diversity and inclusion, businesses environments are
continually changing and developing their strategies and policies to support employees,
clients and suppliers. For an effective diversity strategy to add a real value to the business, it
needs to support the organisations’ overall business goals and objectives.
A Diverse Workforce
A key issue for any organisation, is to create an inclusive working environment where its
staff feel valued and respected. By doing this, an organisation will be more successful in
recruiting and retaining the right people. Under these circumstances, employees are more
likely to make a better contribution to the organisation.
In the following session, you will be introduced to the benefits of diversity in a workplace.
We will be discussing them under four headings:
Reputation of the Business – A diverse workforce raises the profile of the business. Any
business that is known to have fair and ethical employment practices and procedures
regarding diversity is likely to develop a positive reputation.
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Creates a happier workforce – Working in a diverse working
environment with a good business law and diversity policy in
place, helps employees feel respected, understood and
confident that their progress in the business will be based on
ability. This leads to a more pleasant working environment.
Diversity legislation - People will feel more respected when they are aware of a diversity
legislation that provides a framework to ensure that:
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Diversity training - Training is also a very good way of ensuring people behave well and
communicate clearly. This, in turn, helps people feel more respected.
Communication - Communication about diversity is essential.
Monitoring – Monitoring and measuring of diversity is also important in the business.
This is a recap of the most important points that make diversity a necessity in a workplace:
Society and the markets are becoming more diverse, and it is important for a business
to reflect this through having a diversity policy.
Having a diversity policy ensures that every member of staff is valued and treated
fairly and equally as an individual.
A diversity policy extends beyond the staff members, and ensures that customers and
suppliers are valued and treated with respect.
It is important for a business to demonstrate to its employees that their organisation
achieves as a minimum the basic standards of diversity and equality, as defined by the
law, and is committed to the principles of diversity and equality.
A diverse workforce contributes to a good business reputation.
Diversity raises staff morale, gives them confidence and promotes creativity and
innovation.
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Diversity contributes to the long- term viability2 of the organisation.
Lead by example - commitment to diversity and equality should be led from the top
of the organisation. Businesses should not underestimate the impact that a small
number of senior people can have on the whole organisation.
Create an inclusive culture – this can be achieved by having good induction training,
ongoing awareness training, awareness sessions, staff appraisals and special focus
groups.
Employees – treat all staff fairly and ensure equality of opportunity. Help staff reach
their full potential.
Know your customers – a diverse workforce should reflect the markets and
communities that the business trades in, so it is important for a business to
understand its customers.
Diversity and equality policies – policies and procedures that promote diversity and
equality and demonstrate the organisations commitment.
Share and Learn – organisations should establish good working relationships with
other organisations, to share good practice and learn from each other’s experiences.
Equip staff with the skills and knowledge to challenge inequality and discrimination.
2
The business ability to survive
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UAE Diversity Legislation
For the first time in the UAE, federal legislation has now been enacted to help protect
all individuals in the UAE from discrimination on the basis of Protected Characteristics.
There are severe punishments for anyone who
breaches this law. Discrimination is considered
a crime punishable by imprisonment or fines.
Furthermore, Article 6 of the Law is a broad
catch-all provision which states that any
person who commits an act of discrimination
may face imprisonment of up to 5 years and/or
a fine of between AED 500,000 and AED
1,000,000. The same penalties may be
imposed where a discriminatory act is
“committed by a public employee upon or due
Image 19: Discrimination
to performing his job” (Article 9).
Article 17 of the Law states that a representative, manager or agent of a company will
be punished (by the same penalties that would apply if she/he had committed the
offence themselves) if a crime prohibited by the Law is committed by any personnel
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of the company in its name and on its behalf, and provided that the representative,
manager or agent is aware of the discrimination taking place.
Considering Article 17 of the Law, companies in the UAE must ensure that appropriate
internal policies and procedures (organisational guidelines) are established, (and that existing
policies are updated) to raise employees’ awareness and understanding of the type of
conduct which could now constitute a criminal offence under the Law. This should reduce the
risk of an employee breaching the Law, and the company representative, manager or agent
being held responsible for such breach. Such company policies should extend to the use of
online forums and social media in the event that certain comments or opinions expressed
online by an employee could be construed as discriminating against a Protected
Characteristic.
The purpose of this policy is to provide equality and fairness for all in our employment and
business operations, and not to discriminate.
Security means being ‘free from danger or threat’. Every business should think of security as
a priority. Business and customers’ data must be always safe.
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Confidentiality refers to personal information shared with another party that must not be
shared with a third party, without the express consent of the person to whom the
information belongs.
A failure to protect clients’ confidentiality, negatively affects both the people involved and
the organisation itself.
On one hand, leaked information of a client might get the person involved in trouble.
Some clients of large companies might suffer financial losses as a result! In such cases,
the responsible business or organisation might face legal action.
Furthermore, it would tarnish the organisation’s long-term reputation.
Remember, that all businesses must take confidentiality seriously, even if their customers
have not signed a written confidentiality agreement. After all, confidentiality is more of a
moral issue.
Breaking confidentiality is a form of betrayal, which destroys business relationships very quickly.
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other means of communications and the secrecy shall be guaranteed in accordance with the
law.
Most buildings have security arrangements to ensure people entering and exiting the
building are authorised.
These procedures can include sign in procedures for people entering the building.
Employees may have security passes and these are only issued to visitors after they
have undergone security checks and there ID is checked.
There may be designated doors for entering and exiting the building so visitors can
be monitored.
The business may also have security staff patrolling the building at night to ensure its
security
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Image 23: Video Monitoring
Under the law there are distinct legal codes of practice relating to fire and life safety and all
employees in any organisation have a duty to ensure these are followed. To comply with the
law, organisations must ensure the following:
Information is often referred to as “data”. This means it is electronic information that can be
processed by a computer. Most information is stored on computers now. Keeping data on
computers though presents more risk in terms of its security and confidentiality.
In the UAE, there is no one law covering the protection of data and giving guidelines to how
businesses should store it. Data protection is covered under many laws. For example,
Penal Code
Cybercrime Law
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Special law for certain organisations
Dubai Statistics Centre Law
Dubai International Financial Centre Data Protection Legislation
Dubai Healthcare City Regulations
Cybercrime Law
A business may face a variety of risks in the collection, storage and use of information. Some
common IT hazards include:
Virus - a piece of code that can destroy data or corrupt the system.
Phishing - phishing attacks try to persuade individuals to reveal personal information, such as
passwords and bank details.
Stolen identities – If criminals have access to the information that a business has about clients,
they would be able to use people’s identities to obtain goods, services and money.
Sabotage3 of a business′s website – This is mostly done by competitors who try to undermine
legitimate websites. It could also be done by people who have their own reservations about
a business.
3
The action of deliberate destruction and damage
4
The practice of obtaining something, especially money, through force or threats
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Keeping Information Confidential
Article 379 of the UAE Penal Code criminalises the act of disclosing trade secrets.
Punishment. There are penalties for breaking this law (Imprisonment for a period of
not less than one year - fine of not less than AED 20.000).
Under the UAE Civil Transactions Law, an employee must not disclose the industrial or
trade secret of an employer even after expiry of their employment contract.
1. Safeguard your username, password or any other access credentials you have for
systems and applications that deal with confidential information.
2. Protect mobile devices such as smart phones, tablets and USB drives that contain
confidential information.
3. Never leave your computer unattended when confidential information is on the
screen.
4. Before transmitting confidential information to others, be sure that:
The transmission complies with the law and our privacy and security policies.
The recipient has a legitimate business purpose for the information.
You are sending no more information that is needed by the recipient.
You are sending the information in a protected manner (e.g. Encrypted) when
called for by our policies or the law.
5. Retain or destroy confidential information contained in our records in accordance
with our record management policy.
6. Report any security incidence or privacy preaches that you observe or become aware
of as soon as possible.
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Purpose of Confidentiality Policies
Confidentiality policies ensure employees are aware of confidentiality rules and the
seriousness of data security.
Confidentiality policies also ensure employees are aware of the consequences they
will face and the measures their business will take if they commit a breach of
confidentiality. (Warning, termination, legal action)
Failure to properly secure and protect confidential business information can lead to
the loss of business/clients.
Confidential information can be misused to commit illegal activity (e.g. fraud or
discrimination).
Disclosure of sensitive employee and management information can lead to a loss of
employee trust, confidence and loyalty.
In the UAE:
Article 282 of the UAE Civil Code covers the negligent or careless disclosure of a third
party's confidential information.
Under Article 379 of the UAE Penal Code, it is a criminal offence for an individual to
use a third party's information without consent for their own or another's advantage,
where that information was gained during their employment.
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Confidentiality Breaching Consequences for Employees
Article 120 of the UAE Labour Law (Part 6) allows employers to terminate the services of an
employee if an employee reveals secrets of the business.
Summative Assessment
This is the third summative assessment in this unit. Before answering the questions, make
sure you:
Read each question twice so you know exactly what it is asking you to do.
When you have finished writing, re-read the questions and your answers to make
sure you have not made any mistakes.
This is important advice to follow for all written exams.
What is Risk?
A risk is when:
The outcome of a certain action or activity is not certain.
Internal Factors
Employee risks – a business must ensure it has enough suitably qualified employees
running the business to deliver the product or service.
Health and safety risks – remember Risk Assessment from Business Fundamentals I.
Financial risks e.g. suppliers let you down, customers don’t pay or competitors offer
better products or services. Every business might face the financial risk of making less
profit than what is expected or even worse, it might experience loss instead of making
a profit. New start-up businesses are usually at risk of failure because of a lack of profit
or a lack of capital.
Video Script:
‘‘Although we all subconsciously manage risks daily, not all risks are immediately obvious. Last
week, I received an email from a Nigerian government official requesting my assistance in
40
transferring 21 million dollars to my bank account. All I had to do was provide my personal
banking details. Like most people, I clearly identified the risk of identity fraud. But some risks
are not as apparent and you may need to conduct a more formal structured risk identification
session. Risk identification is simply the process of finding, recognising and describing the
risks. Here are my three favourite ways of identifying risks:
Remember, there are dozens of ways to identify risks. Choose the most appropriate method.
The most critical element of risk identification is to take time out, use your brain and think
about the potential risks.’’
Key Points:
The video mainly discussed the definition of risk identification and three ways to identifying
risk. In the following session, you will read more about these two points:
Brainstorming involves a group member contributing their ideas on what could create
a risk in the workplace. This technique is simple and can be easily applied. One way to
41
applying it is mind mapping, where you put the problem in the centre of the map and
you draw lines to circles with generated ideas in them.
Surveys are lists of questions that are developed to seek out risk in a particular area.
Surveys could include both closed and open-ended questions. Closed questions are
those which can be answered by a simple one-word answer, or they have a specific
set already suggested answers (such as: A, B, C). Open-ended questions are those
which allow the participant to freely answer the question and express their own
thoughts using their own words.
Interviews are an effective way to identify risk areas, the interview process is
essentially a questioning process.
Incident analysis-risk assessment – To assess a risk by analysing an incident, you
might resort to using a template like the one in the photo below. Such a template
helps you to recognise potential hazards. You then look at who is at risk. What is being
done to control the risk (control measure) whether the risk is high or low and what
can be done to prevent an incident and finally who is responsible for these actions.
(Remember ‘Making Risk Assessment’ in Business Fundamentals I – Week 5)
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Competitors - competitors who offer better products or services at similar or cheaper
prices are sources of financial risk to your business.
Employees – As mentioned before in session 27, not having enough suitably qualified
employees running the business to deliver the product or service, constitutes a serious
risk to the business.
Customers – Unsatisfied customers pose the risk of making less profit and a potential
loss (financial risk) to the business.
Modern technologies – Some new technologies (new products or services) have the
potential to re-shape customers’ lives and change the market demands. Business
leaders must look ahead, be aware of the challenges posed by evolving technologies,
and always prepare for their impact.
Law and regulations - New laws are brought in by the Government that change the
way you have to do business.
Remember, a method of identifying sources of risk, either internal or external, is to carry out
a SWOT analysis, remember, SWOT is short for Strengths, Weaknesses Opportunities and
Threats.
SWOT Analysis
SWOT is a very effective tool in business. It could be used to review a strategy or any other
business idea. Also, it is useful in identifying potential risks to the business.
The word SWOT contains the initial letters of the following words: (Strengths, Weaknesses,
Opportunities and Threats).
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Image 29: SWOT Analysis
Threats – what are the challenges or obstacles that your business might face. These
can be a change in the law or regulations to difficulty hiring people with the right
qualifications.
Risk
Hazard The likelihood that
Anything that can cause this trouble/ harm will
trouble/harm be caused
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Some other examples of hazards in a buisness environment are:
Dangerous chemicals.
Dangerous machinery.
Gas or electricity.
Fire.
Consequences of working in confined places.
Consequences of dealing with a lot of pressure caused by the work.
Such hazards might affect employees’ health and make the workplace an insecure and unsafe
place to work in. To successfully manage potential hazards and risks, follow the steps below:
Control measures are actions and / or activities that are taken to prevent or
reduce the likelihood of being exposed to a hazard.
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Thus, a risk assessment involves making a judgement about these questions:
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Struck by object/person – It’s important to identify
the potential sources and causes of incidents and
introduce appropriate control measures
Incorrect use of display screen equipment (DSE). DSE includes any computer-related
item (PC, laptop, touchscreen, desk or chair) which might cause damage to the user if
used improperly (damage to the eyes and back problems due to poor posture).
Fall from height – Proper planning of proposed work with assessments and controls
of the risks, is essential.
Fire (Gas or Electrical) – Ensuring that exit doors are easily accessed, fire drills are
regularly conducted, fire alarms are regularly tested and all systems are installed by
suitably qualified contractors.
Water damage – regular check-ups on water pipes and ensuring they are in good
condition.
Burglary/Theft – You can improve the physical security of business premises by
installing electronic security systems such as CCTV, intruder alarms and security
lights.
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Top 5 Business Risks
The risk of market disruption is always there and is very difficult to prepare for. There is often
no sign that it is going to happen. The economy suddenly takes a downturn, or competitors
enter the market or launch new products.
Property loss – As mentioned earlier in this unit, businesses need to ensure that there are
regulations in place that enable them to record and limit the number of people entering the
building. This is to ensure the security for their staff and the confidentiality of their
information.
Injury - Businesses have legal responsibilities to ensure a safe workplace environment to their
employees. In addition to the decline in productivity and the medical treatment costs, a
business with high injury rate puts its reputation at risk.
Court claims – As mentioned above, businesses have some legal responsibilities to prevent
some hazards from happening and causing harm. A failure to properly and proactively
respond to them puts the business at risk of civil or criminal court claims.
Security breach - Information security constitutes a critical factor towards business continuity.
It is important for every business to collect, store and process information in ways that are
ethical, promote trust and meet legal obligations. A Business is expected to recognise when
the behaviour of others fails to meet these standards.
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Remember: It is important to consider the circumstances surrounding the faulty
action
Also, that caused
business leadersconfidentiality
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aware of Ifthe
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investigation proves
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its data.
A business should be able to effectively assess potential hazards and risks to its information
and resources. To do this, it is essential to have a knowledge of:
Identifying the nature of the hazards and their likelihood helps the business to recognise
their impact and what can be done to reduce the risk. Hazards can be reduced by changing
resources or activities (the way things are done) so that they do not happen. The likelihood
of the hazard happening can also be reduced by changing resources but, most often, by
changing the way things are done (activities).
Solutions to minimise the Impact and Likelihood of the Top 5 Business Risks
References
Greenberg J. Diversity in the Workplace: Benefits, Challenges and Solutions. Available at:
http://www.multiculturaladvantage.com/recruit/diversity/diversity-in-the-
workplace-benefits-challenges-solutions.asp
Rhodes A (2015) How To Perform A Simple Business Risk Assessment. Available at:
http://blog.ventivtech.com/blog/how-to-perform-a-simple-business-risk-assessment
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HCT
2.0
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