Reference no: EM13738800

PART 1:

To assess candidates' ability to create contingency plans and to analyse contingency plans to ensure that they meet organisational requirements and mitigate risks to the business.

ASSESSMENT DESCRIPTION

Identify risks associated to the business and develop a contingency plan that provides appropriate strategies to deal with the risks.

PROCEDURE

1. Identify potential risks to the business.

2. Develop strategies to minimise those risks.

3. Identify who might need to be consulted as part of the plan.

4. Identify a dollar value for an activity that might incur a cost.

5. Use the template provided.

Create contingency plans for the following scenarios:
• One of your highly qualified consultants has given three months notice and is planning to move to a competitor after this time.
• There has been a 34% increase in production; however a decrease of 22% in sales has been recorded.
• The rental for the offices your company currently occupies is being increased by $1750 per month. There is no available space for additional employees.

PART 2: PLAN ANALYSIS

Read the following Contingency plan developed by Eden Black for Proactive Management Consultants Pty Ltd. Your task is to analyse the strategies that have been developed to mitigate the risk and answer the questions below.

Contingency plan Company name: Proactive Management Consultants Pty Ltd. Name of person developing the plan: Eden Black Who was consulted as part of this plan? Name                                      Position David Grey                              Financial controller Brianna White                          Operations manager Angie Brown                            Senior accountant   Shankar Singh                         Marketing manager Jordyn Gee                              Sales manager
Risk identified: Strong possibility of a new competitor moving within close proximity to our company within six months. The current date is the 1st of July 20­­____.
Strategies/activities to minimise the risk	By when	By whom
Work out a possible lower fee schedule to entice new customers and remain competitive.	1/08/201X	AB/DG
Increase the advertising budget and work on a new marketing strategy.	15/08/201X	SS/DG
Work with sales to extend current contract periods and offer discounts as incentives for customers.	1/09/201X	JG/AB
Enter into an agreement with existing firms for referral to each other complimenting for services.	15/09/201X	DG
Looks at ways of outsourcing to extend client base.	25/09/201X	BW
Make six people redundant to compensate for future losses.	20/10/201X	BW/JG

1. Has Eden identified all strategies to mitigate the identified risk? Justify your response.

2. Has Eden correctly identified the correct people to consult in the development of the strategies? Justify your response.

3. If you believe Eden has not identified all the strategies or people to be consulted, what would your recommendations be?

4. Are the timelines that Eden has created achievable? Justify your response.