Element 1: Contribute to Implementation of Opertional Plan
Contingency Planning A risk is defined as a situation, problem or activity that would have an impact on the progress of a program, sub-program or project if it were to actually happen. Risk is a natural part of all businesses, and in order for you to manage it effectively it is important that you have a management program in place. A risk management plan is a plan aimed at attempting to build a picture of the types of events which could occur, unexpectedly, within your organisation. These events will often occur at the worst possible time, so you need to be sure that you have contingency plans in place for any such event and that your staff are aware of what they need to do when each of these events actually occurs. These surprise events could be anything from a robbery, to a natural disaster, to your suppliers being forced to shut down. When you are working to manage contingencies within your organisation, you work through 4 steps. These steps are:
1. Identify risks that are present 2. Measure the impact of these risks 3. Develop a series of steps or strategies that you can use
to manage the risk that is present
4. Monitor these strategies to ensure that they are working. When you are beginning the process of developing your contingency management plan, you should start by reading through and analysing your business plan. Your business plan should bring together an analysis of the organisation as a whole and the environment within which it is operating. Try to think of your organisation from an outsider’s point of view. What impacts could you foresee affecting your business? What could cause it to fail? What has been omitted from your business plan? Spend time thinking through every possible occurrence that you consider as a major impact to your organisation. A great question to ask yourself is “what if?” What if an earthquake occurs, what if we are robbed? What if our biggest supplier closes down? What if the cost of our supplies double in price? You need to have in your mind answers to these questions in order to determine where the most significant risks are likely to occur. There are many organisations who offer contingency management services to small and medium sized businesses, but often you will find that because they are not intimately familiar with your business, they may fail to pick up all possible issues that may occur with your organisation. You and your staff are in the best position to pick up everything that could potentially impact on your business, so spend time thinking through these issues yourself and see just how far you can get on your own before you consider employing any such consultant. So, you will now have a list of all the possible impacts that you can foresee in your business. This list forms the possible contingencies that you need to find ways to manage effectively. Take these lists of risks and look for ways to manage each of them. Remember that this may be as simple as having insurance or more complex risks may require an entire plan to be developed around them.
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Trainer Manual BSBFLM305C Support Operational Plan © Precision Group (Australia) Pty Ltd