Reference no: EM131522867

Discussion 1:

Part 1:

I'm risk averse with my finances, and how I use and spend money, and I'm most risk tolerant with my social life and my personal health. I don't put much meaning into these surveys or questionnaires, and take their results with a grain of salt. The Risk-Taking Scale is fairly accurate with how I personally think about myself with risk taking. I'd consider myself very financially conservative regarding gambling and risks regarding large amounts of money, and can see how I'm most risky with my social life. Even though I wouldn't follow through with several of the social risks listed on the questionnaire, I'd be hypothetically more like to do them, for instance I would be very likely to defend an unpopular opinion that I believed in but less likely to wear provocative or unconventional clothing.

I fall somewhere near the moderately risky median ethically and recreationally. If I were to organize my risks via ERM my most relevant risks would be my finances, how much I save, and could my risk appetite for saving or spending more be greater. (Crickette, et al., 2012) Another relevant risk of mine would be my health, should I increase my health risks by exercising less or decrease my health risk appetite by exercising more. After describing the probability of occurrence of my overall health dropping the fewer times I visit the gym, I'd say there is a high probability that I will become unhealthier over time if I stop visiting the gym, which is a risk I'd to not take. ("A Risk Management Standard", 2002)

Part 2:

The most serious risk for the insurance company I work for currently is the healthcare and insurance system we currently have being turned on its head, or being completed dismantled by our countries leadership. This risk is most likely to occur since we are still currently working with the Affordable Care Act, which looks to be changing into another form of healthcare. Could we as a country be moving to an individual payer system? If our healthcare system changes back into what we had before the Affordable Care Act the financial impact on the health insurance business would be a positive one since Affordable Care Act members cost the system and the companies providing the insurance money. ERM's have surely been done within my company to identify this risk, and planning has been considered for each possible outcome.

Discussion 2:

Discussion part 1: Risk Tolerance Questionnaire

After taking the Risk Tolerance questionnaire, my result for each category risk assessment was right on point. In the categories for ethical, financial and health/safety I perceive each of these situation as not at all risky. For recreational and social, I perceive these categories as moderately risky. Although I am one to avoid risk, my assessment or uncertainty of risk can be exact, specific, and deliberate. I weigh all alternatives. This allows me to think about the relative desirability of consequences of the options I am considering. On the other hand, I can typically be a nitpicker, rigid and cautious. I feel at this stage I balance the attractiveness of the consequences with the chances of occurring. As far as my risk tolerance, I consider this area to supersede my risk adverse because I am willing to take risks and prefer the most attractive option. I am a person who naturally takes time to think about how I could or should evaluate or assess to achieve better consequences and outcomes. Individuals who reflect in a more risk adverse manner usually allow poorer consequences to weigh more than the better ones.

Ethical - low

Financial- low

Health/safety - low to moderate

Recreational - moderate

Social - moderate

Discussion Part 2: Considering various business risks

I work for an Education Organizational Development and Learning department for a leading not-for-profit health care system. One of our primary benefits that our department oversee is the tuition reimbursement program. This program provides financial assistance for certificate programs, college credit, degreed and non-degreed courses taken by team members to help them improve, advance or transfer to another position within the organization. Our company has grown from 16,000 employees to over 26,800 in the last five years. More and more employees each day is using this benefit to achieve professional and academic goals. Due to the volume of end-users, we were running out of server space and needed to update our uploading feature. We implemented a cost and risk analysis to upgrade to our online tuition system. Although this new idea of upgrades and enhancements to the current system sounded great, we also had to weigh alternatives in reference to as what the organization had control over or can impact. To implement this change it cost about $25,000 dollars. However, this allowed flexibility and continuous schedule of maintenance for the lifetime of the system and all users will be able to benefit using a renovated system. One important factor we have to decide on was moving all records from one system to the other. We realize that we could potentially run in to a risk of losing important files during this transitions. This led to some uncertainty of important decisions we had to make which involves calculated risk by launching an enhance system. Whenever uncertainty exist, there can be no guarantee that a smart choice will lead to good consequences (Hammond, 1999). By using risk profiles, we were able to run a consistent basis for equating the uncertainties affecting each of our alternatives. In the end, we were able to announce the successful planning and implementation of the newly renovated system. According to the Business Planning article on Mitigating Risk- risk management can be applied to an entire organization, at its many areas and levels, at any time, as well as to specific functions, projects and activities (Rice, 2010).