Risk Management Concepts and Guidance †MyAssignmenthelp.com

Question: Discuss about the Risk Management for Concepts and Guidance. Answer: Introduction Procurement is the procedure for searching, obtaining several goods and services, agreeing to the terms by a competitive bidding procedure (Phillips 2013). This particular procedure of procurement is utilized for ensuring the buyer for receiving the various goods, works and the services at the most affordable price. This procedure is executed when the various characteristics like location, time, quality and the quantity are compared with the other characteristics (Larson and Gray 2013). The corporations and all the public bodies always define the procedures, which are intended for promoting the open and fair competition for the business for the minimization of the risks. These risks mainly mean to the exposure to any type of collusion and fraud. The project procurement management can be defined as the process of the supply of goods that are received and ordered. This procedure is sub divided into five portions, which are initiating and planning, selecting, contract writing, monitorin g, closing, and completing (Kendrick 2015). The project risk management can be defined as the procedure for minimizing or mitigating the risks in a project with the help of certain steps. The following business report outlines a brief discussion on the Supplier Relationship Management or SRM with the help of project procurement and project risk management. The business report describes about a particular business of United Kingdom that sources food materials from Greece (Kerzner 2013). This business often undergoes through various types of threats during the procurement of the services and products. This following report further describes about the management of the risks of the various threats, which are arising in their business (Bryde, Broquetas and Volm 2013). This report has taken the example of a popular bakery shop of United Kingdom, namely Irwins Bakery. Relevant information is provided in the report regarding this famous bakery company. Supplier Relationship Management Supplier Relationship Management or SRM is the first and the foremost approach that is utilized for the engagement of the suppliers on such a level, which reflects all the priorities of the customer company and how best these requirement can be fulfilled (Pryke and Smyth 2012). Supplier Relationship Management is a process of differentiation, which identifies that not all the suppliers are of similar types and therefore not all the relationships between customers and suppliers can be dealt with one single strategy. The relationship between the customer and the supplier is managed and controlled with the help of the supplier relationship management (Edwards and Bowen 2013). The holistic nature of the supplier relationship management approach needs the overall engagement and consent of the entire company. Perfect supplier relationship management cannot be attained through only the functionality of procurement. At the level of partnership, this means it is the involvement of the executive team; at the very minimum. This eventually means those functions that are acting in a structured way so that the company does not appear unstructured or disorganised to the outer world (Liu, Meng and Fellows 2015). As with most of the procurement activities and at the most basic level, the Supply Relationship Management or SRM can be utilized for the reduction of both the costs and the prices paid to the company. By the development of proper styles of collaboration, even the ones that adversarial, it is possible for saving money. The suppliers have various expectations like how the customers will act and how will they respond (Fleming and Koppelman 2016). The main feature for developing an approach of Supplier Relationship Management or SRM is completely based on the supplies of the company. As the customer company will develop its inward understanding and own maturity, it will become possible for the development of more value adding capabilities to the relationships that are being nurtured. Initially this is often at the service or product level. However, as the customer company progresses this often expands to involve the sourcing strategy and an evaluation strategy that are based around the provisions of core competencies and of non core competencies (Leach 2014). The core competencies are internal and the non core competencies are external. Whilst the above focuses heavily upon inward reflection, it quickly becomes just as essential for understanding what the individual suppliers and the supply market are capable of delivering to the company. A perfect strategy of relationship will carefully discriminate between the external and internal provision in a way that does not compete or compromise with any other. At this particular point, the importance is given on the alignment of the organisations in order to make sure that the services and the products flow through the supply chain and network towards the end customer (Eweje, Turner and Mller 2012). The concept of flow that are both value and physical brings into focus the need for stable and capable processes that perform over time (Xiang et al. 2012). The companies that are high performing have supply that are high per forming networks and this comes from the alignment of approaches and objectives to how things are done across the entire company. By knowing what is expected, suppliers are able to manage their own businesses for the long term (Burke 2013). Not only is this more cost effective, it is also more robust from an operationally competitive perspective. Irwins Bakery Irwins Bakery is a United Kingdom based organization that manufactures bread, muffins, cakes and many more (Irwinsbakery.com, 2017). This is the largest independent bakery of Northern Ireland. It supplies the broader range of all traditional breads of Ireland. The main super markets of Irwins Bakery are in United Kingdom and Republic of Ireland. This particular company has more than four hundred and fifty employees. The production site of this company is about 100000 square feet area. Every week it manufactures more than one million loaves and the morning goods (Irwinsbakery.com, 2017). The company, Irwins Bakery was first founded in the year 1912 in the Co. Armagh town of Portadown. W. D. Irwin, who was then a grocery retailer, founded the company. He and his family members used to bake cakes and other bakery items at home for their shop. Then, more bakers were employed and in the year 1965, this bakery launched their specific brand of plain or batch bread. They named it as Nutty Kr ust and this became extremely popular in entire Ireland (Irwinsbakery.com, 2017). This company gets all its food materials from several countries. One of the major countries that export food materials to this company is Greece. This is one of the most popular food manufacturing companies in United Kingdom that has customers from all over Europe. It sources its food materials or raw materials from everywhere. However, the main source of the food materials is from Greece. Greece is famous for its cheap and good quality of food like cheese, milk, flour and many more. Irwins Bakery for their business procures these raw materials (Irwinsbakery.com, 2017). They do these by simply following procurement management in the company. The strategic procurement depends on strong Supplier Relationship Management or SRM where procurement professionals are concerned about developing robust supplier relationships and negotiating favourable terms and conditions. In the future, it is expected that supp ly chain structures will become more complex and choosing the right supplier will be more critical. Increasingly stringent supplier requirements will become routine, and demanding purchasers will expect suppliers to demonstrate their essential competencies (Irwinsbakery.com, 2017). Supply chain risk, scarcity of raw materials, environmental, sustainable and economic issues will lead to increased pressure on these buyer supplier relationships. Supply Relationship Management in Irwins Bakery The SRM or Supplier Relationship Management cannot be executed without a elementary modification in the procurement, the company it serves and the suppliers involved in the new approach (Pretorius, Steyn and Jordaan 2012). There are innovative approaches of working that may be procurement led. These approaches need the engagement that is honest and active of all those approaches that are involved. Making structured and controlled relationships, which normally balance the objectives that are long term with the short term requirements will need the flexibility on both the sides if this is to be successful. This does not mean that there will be a reduction in the power of the company (de Carvalho, Patah and de Souza Bido 2015). Rather, this means working as the portion of a particular network for ensuring that the value of each and every player is influenced towards the requirements of the end customer and of each company within the supply chain. Risks in Irwins Bakery Irwins Bakery often undergoes certain risks and threats of economy and this mainly occurs from the supplier relationship management (Kendrick 2015). There are several types of risks and threats that are common for supplier relationship management in Irwins Bakery. The common risks are as follows: Ownership / Awareness of Supplier Risk: The ownership or awareness of supplier risk is the most common risk in Irwins Bakery. Material Outsource Risk: The material outsource risk can be defined as the outsource relationship, which carries the significant threat of the end customer (Pretorius, Steyn and Jordaan 2012). For this threat or risk, the customer will be completely responsible. Supplier Operational Service Failure Risk: The operational service failure have the most important and significant impact of the end customer or the impact of the substantial non end customer (Xiang et al. 2012). These impacts mainly refer to as the reputational, financial, legal, operational and many more. Irwins Bakery often undergoes this type of supplier operational service failure risk or threat in its company. Supplier Business Continuity Risk: The supplier business continuity risk is the most important and significant risk for any organization (Kendrick 2015). The disaster recovery plan is the example of the supplier business continuity risk. Irwins Bakery often undergoes this type of major risk or threat in its business. Contractual Risk: The bakery shop has annual contracts with certain companies for the procurement of their business. Irwins Bakery brings all of its products from various places. The major source of food materials for the company is Greece (Pritchard and PMP 2014). Often they face or undergo various risks for the failure of contract. When the sources of food materials will be stopped, it is evident that the overall manufacturing of the food materials will be stopped. Thus, this is one of the most significant risks of Irwins Bakery. Dependency Risk: Irwins Bakery is dependent on the suppliers of the company. They supply the raw materials from Greece and then only, the food materials can be manufactured. Thus, this dependency on the suppliers is extremely harmful and risky for Irwins Bakery. The dependency often creates problem for the company. Supplier Financial Risk: This is again one of the most significant risks for any organization. The risk of the financial state of suppliers often becomes a huge problem for the company, Irwins Bakery (Kendrick 2015). The organization is not capable of fulfilling all the demands of the customers because of their financial condition or sometimes the supplier does not supply the raw materials even after getting the money. Supplier Capacity Risk: Often the supplier does not have adequate capacity for the requirements of the manufacturer. The clients demands and the requirements cannot be fulfilled if the supplier do not have adequate capacity of resources. They will not be able to fulfil the demands of the clients and thus the supplier will lose one of its customers. Relationship Quality Risk: When the relationship between the supplier and the customer is broken due to past incidents, there is a high risk that the quality of the raw materials he would be sending, will be at stake (Xiang et al. 2012). This particular type of risk is extremely common for any company and mainly for manufacturing organization. Irwins Bakery can undergo this type of risk of relationship quality as they have their raw materials from all over Europe and especially from Greece. Strategic Risk: Irwins Bakery often undergoes this type of risk in their business or organization. The strategic risk can turn out to be extremely risky in terms of any growth and development (Eweje, Turner and Mller 2012). If the strategies of the organization will not be perfect, there is a high chance that the organization or company may suffer or incur losses. Reputational Risks: This is another important risk for any organization. The reputation of the customers mainly depends on the impact of its suppliers. These risks often can be termed as risky and it has a negative impact on the suppliers. Economic Risk: This is the most significant and important risk for any organization. When the particular company will not have enough or adequate economic resources, it is evident that the organization will not be able to fulfil the demands of its customers (Pritchard and PMP 2014). Economic risks mainly occur when the company does not have enough customers or clients. Mitigation Plans of Risks for Irwins Bakery These risks are extremely vulnerable for any organization. They often turn out to be risky and thus these often become major problems for that organization (Kendrick 2015). However, these above mentioned risks or threats could be mitigated or reduced by undertaking certain approaches or steps. The ways for the reduction of these risks in Irwins Bakery are as follows: Supply Chain: The company, Irwins Bakery knows their supply chain perfectly and for gaining the view of end to end supply chain, the company has set certain employees. These employees look into the supply chain regularly and if there is any scarcity in the supply chain, the employees directly report to the organization (Eweje, Turner and Mller 2012). The supply chain management of the company is checked regularly. They never neglect their upstream supplier relationships. It is extremely important that the manufactures of the company make the comprehensive inventory for all of their supply chain relationships. Identification of the Risks related to Suppliers: The Company always identifies the risks that are related to the suppliers and thus this identification reduces the chance of losses in the organization (Zou and Sunindijo 2013). The suppliers can have several risks like contract risks, reputational risks, financial risks, information system failures, economic risks, strategic risks and many more. Assess the Supplier Risks: The supplier risks are immediately assessed by the company and thus this reduces the risks of Irwins Bakery. Leverage Technology: The important technology is leveraged and this reduces the risks of the supplier management. When the size of the supply chain is increased, the supplier risk management programs are costly, tedious and resource intensive (Taylor, Artman and Woelfer 2012). Irwins Bakery bakes cakes, muffins and many more items. All this baking is done with the help of technology and thus this technology is leveraged regularly or periodically. Manage Supplier Risks: The supplier risks are managed or mitigated with the help of perfect management strategies. Irwins Bakery does this with the help of various and several employees, who look after the overall growth and development of the organization (Pritchard and PMP 2014). This helps them to mitigate or manage the risks of the suppliers easily and eventually. Procurement Function Procurement function manages the network of the vendors and suppliers easily, quickly and globally. This management becomes inoperative due to the rapid shifts in the business environment (Kendrick 2015). This procurement is the procedure for searching and agreeing to the conditions and obtaining the services, goods or works from any external source. This procurement function helps to control the network of the suppliers, vendors or the supply chain and thus the organization mitigates or reduces the risks of their supplier relationship management (Zou and Sunindijo 2013). Moreover, procurement management is the major factor for the success of any organization as it fulfils the organizational goals, objectives and expectations of the stakeholders. There are various case studies or recent cases for fraud in procurement function in the organization. However, these frauds can be reduced by various steps. These risks often turn out to be extremely risky for the organization and the organization can suffer various problems in the business. Conclusion Therefore, from the above discussion it can be concluded that, procurement management is the procedure of the supply of services or goods, which are ordered and received. This process is further divided into five major parts that are initiating and planning, selecting, closing, contract writing, monitoring and completing. The project risk management can be defined as the process for the mitigation or the minimization of the risks in a particular project with the help of several steps. Procurement is the process for searching, acquiring various services and goods, agreeing to the conditions by a competitive bidding process. This particular process of procurement is used to ensure the buyer for receiving the several services, goods and the works at the price that is absolutely affordable. This process is implemented when the several characteristics like quality, quantity, time and location are compared with all the other characteristics. The public bodies and the corporations always de scribe the processes that are intended for the promotion of the fair and open competition for the organization for the reduction of the risks. These risks mainly mean to the exposure to any type of fraud or collusion. The above report provides a brief description on the Supplier Relationship Management or SRM with the help of project procurement management and the project risk management. This particular business report describes about a particular United Kingdom business, which supplies food materials from Greece. The example taken in this report is Irwins Bakery, which is located in United Kingdom. This business often suffers through several types of risks during the procurement of their products and services. This report discusses about the management of the dangers of economic and other risks that are arising in the business. The procurement function manages the network of the suppliers and the vendors globally. Relevant case studies are provided in the report for understanding the procurement management of the United Kingdom business. References Badri, A., Nadeau, S. and Gbodossou, A., 2012. Proposal of a risk-factor-based analytical approach for integrating occupational health and safety into project risk evaluation.Accident Analysis Prevention,48, pp.223-234. Bryde, D., Broquetas, M. and Volm, J.M., 2013. 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