Risk Management Plan Qantas Airline for Risks- myassignmenthelp

Question: Discuss about theRisk Management Plan Qantas Airline for Risks. Answer: Risks Facing Qantas Airline Group The risks facing Qantas Airline can be identified as illustrated in the SWOT diagram below; SWOT Analysis Diagram Strengths Strong, reputable company name in the home market. Fuel efficient and modern aircraft. Have strong competitive subsidiary brands. Strong government support. Weaknesses Much concentrated in the Australian region at the expense of the international segment of the business. Competition from other international airline businesses Opportunities There are opportunities to grow both domestic and international markets. The company business operations have not saturated in all the continents. Threats The increase in fuel prices is likely to affect the company business operations. The cost of acquiring and maintaining the staff has been increasing. New airlines entry threats in the industry and competition in the domestic market Global economic crisis Other Tools and Techniques Tool Identification Techniques Probability and Impact Matrix Risk Data Quality Management Expected Monetary Value Analysis Simulation Technique (Monte Carlo Analysis) Root Cause Analysis Checklist Analysis Assumption Analysis Information Gathering Techniques Risk Analysis Likelihood of the is occurring There is a large likelihood of the risks facing Qantas Airline to occur. The increase of cost fuel is evident from the fact oil prices a prone to fluctuation all over the world(Sky News. Com, 2016). Secondly, the increasing the cost of maintaining the company employees may increase because of the trade unions and employment agencies that call for the protection of the workers' rights(The Conversation, 2015). Third, any lucrative business will attract new competitors. Likewise, the existing competitors are likely to intensify their competition to either increase their market share or to maintain their competitive advantage. Therefore, there is a risk for the reduction of the Qantas' Airline domestic market. Finally, the global financial and economic crisis affects all companies undertaking the international business(Robertson, 2016). Similarly, Qantas Airline is likely to suffer from the consequences of the economic recession. The Impacts of the Risk The occurrence of the risks mentioned above will have the following consequences in the event of their occurrence; Fuel increase The unmanageable increase in fuel prices may force the company to reduce its business operations(Thomas, 2014). For example, the Qantas Airline may end reducing its business international operations. This will have negative impacts on the company profits and may also be an opportunity for the competitors to thrive. Costs of acquiring and maintaining staff. The costs of maintaining staff will contribute to negative impacts on the company profits. The costs being used for normal business operations may exceed the capital expenditure making it difficult for the company to progress. Additionally, the attempts to lay off or retrench some workers may result into litigations that will cost the company heavily. Threat of the new entrants The entry of the new players in the industry will increase the competition, and this negatively affects the Qantas Airline profit. Global economic crisis The global financial crisis will affect the international business operations of Qantas Airline. This may lead to the closure of some of its international business segments. Impacts Negligible Marginal Critical Catastrophic Likelihood LOW New entrants MEDIUM Global economic crisis HIGH Staffing costs Fuel prices increase Risk Matrix Evaluating and Prioritizing Risks for Treatment New entrants threats The likelihood of the new entrant threat is low. However, its impacts are high. This call the company to call for the additional competitive advantage to overcome the threat of the competitors. This risk suits to be position three in the matrix. Staffing Costs There is a high probability of this risk occurring. However, its impact is moderate. Therefore, the company can operate with its existence. This ranks the staffing cost risk at position four. Global Economic Crisis The probability of this risk occurring is medium, and its impact is extreme. This is the risk that can hamper company operations in the international market. Based on the likelihood and severity of this risk it is ranked at position two. Fuel Prices Increase This is major risk facing the Qantas Company. Its probability to occur it high as well as its consequences. Fuel increase is the critical concern that the company should adopt an appropriate mechanism to switch to another alternative in case it occurs. Based on the matrix mix evaluation, this risk qualifies to be in the first position. Selecting and Implementing the Treatments Appropriate options for treating the top three risks The most appropriate strategy to overcome the risk of oil prices is by having an alternative. This means that the company will continue to operate even when the oil prices go up. The global crisis problem appears to be challenging for the company to overcome it. However, in case this risk occurs the company can reduce its international business operations and concentrate more on the domestic business. Action plan for implementing risk treatments Risk Option Treatment Plan Increase in fuel prices Transfer Alternatives to fuels Global Economic crisis Reduce Reduce international business operations New entrants threats Accept Accept the competition by increasing the company competitive advantage. Communicating the action plan The communication plan will include all the content pertaining the risks treatment plans. The concerned parties will be notified about the risk treatment plans through emails, telephone calls and memo circulations to their departments both in the company parent business and subsidiary businesses. Documentation needed The action plan options and treatments strategies will be documented both in the hard copy and in the soft copy. The soft copy will be stored in the companys data base while the hard copy will be under the custody of the company secretary. Steps to Implement Risk Management Plan There four key steps are(Crain, 2014); Identifying the risk Analyzing the risk Treating the risk Monitoring and assurance to the concerned parties Monitoring the Action Plan The company should evaluate the risk management plans after every three months to determine whether the identified risks are being addressed as well as check for the emergence of the new risks. Evaluating the Process of Managing Risks The evaluation of the risk management plan will be based on the risk assessment tools and techniques identified earlier in this paper. These techniques will include checklist analysis and SWOT analysis. References Crain, J., 2014. Four Key Steps to a Risk Management Plan. [Online] Available at: https://gibraltarrisk.com/content/4-key-steps-risk-management-plan [Accessed 29 August 2017]. Robertson, A., 2016. Airline capacity cuts an early warning of Australian economic malaise. [Online] Available at: https://www.abc.net.au/news/2016-04-19/airline-capacity-cuts-an-early-warning-of-economic-malaise/7339562 [Accessed 29 August 2017]. Sky News. Com, 2016. Qantas warns of industry challenges. [Online] Available at: https://www.skynews.com.au/business/business/company/2016/10/21/qantas-warns-of-industry-challenges.html [Accessed 29 August 2017]. The Conversation, 2015. What the Qantas shakeup means: expert analysis. [Online] Available at: https://theconversation.com/what-the-qantas-shakeup-means-expert-analysis-2882 [Accessed 29 August 2017]. Thomas, G., 2014. WHAT IS WRONG WITH QANTAS AND AUSTRALIA?. [Online] Available at: https://www.airlineratings.com/news/what-is-wrong-with-qantas-and-australia/ [Accessed 29 August 2017].