Answer

Managing Risks in Self-Serve Frozen and Toppings Yogurt Shop Project

Introduction

Risk management is an essential function in project management. According to Kiznyte, Welker and Dechange (2016), risk management is the deliberate and strategic process through which an organization identifies, assesses, and controls threats to its earnings and capital. Risks or hazards could arise from varieties of sources including legal liabilities, accidents, natural disasters, financial uncertainty, and errors in strategic management among other factors. It is important to safeguard the organization against these risks through proper risk management. The process entails planning, identification, qualitative analysis, quantitative analysis, response planning, response implementation, and monitoring of risks. Guided by this background, this paper creates a project risk management document for opening a self-serve frozen and toppings yogurt shop.

1. Risk Planning

Risk planning involves preparing for unexpected events with the intent of minimizing the impact of a hazard. Risk planning begins with the identification of the risks that a business is exposed to within its environment. The second step is analyzing risks. This stage requires the business to ask the question how will the possible risks affect the business. Additionally, it involves determining the scope, seriousness and severity of possible risks (Kiznyte, et al. 2016). The third step of risk planning is ranking risks according to severity. Risks with the highest possible negative impact are to be prioritized during risk management. The fourth step of risk planning is treating the risks. The risks have to be allocated with mitigation approaches and those that cannot be eliminated, should be contained. The fifth step is monitoring and reviewing the risks to update the preparedness of the business (Kiznyte, et al. 2016). These steps form the strategy for handling risks in the self-serve frozen and toppings yogurt shop.

1. Risk Identification

The first major negative risk is reputational risk. Most startups experience the setback of having to create and sustain a reputation that will make them admirable to customers. Other negative risks include economic risks, political risks, environmental risks, competitive risks, financial risks, credit risk, market risks, and liquidity risks (Sadgrove, 2016). On the other hand, the self-serve frozen and toppings yogurt shop could be exposed to positive risks such as technology risk, supply chain risk, and project risks. The positive risks arise when the project is properly managed thus creative an admirable outcome. A breakdown of these risks is summarized in a risk identification checklist below (table 1).

Table 1: Risk Checklist

1. Qualitative Analysis

 The qualitative risk assessment matrix in table 2 will be used to rank the risks identified in the risk checklist. An interpretation of the different colors of the risk matrix is summarized in table 6 in the appendix.

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Table 2: Qualitative risk impact matrix

Table 3: Summary of Qualitative Analysis

1. Quantitative analysis

Prioritization of these risks can be done by allocating probable monetary figures to the risks. Alternatively, the number of days the risky events are likely to affect the project in the event of occurrence.

Table 4: Quantified risks

1. Response Planning

Table 5: Risk response

1. Response implementation

Assuming that global health pandemic disrupted normal lives of target customers, there occurred an economic recession, and that the firm introduced disruptive technologies, the decisions to accept the negative risks was mediated by the advantages arising from using technologies. For instance, exploiting digital technologies for electronic commerce enabled self-serve frozen and toppings yogurt shop to make deliveries directly to the client. This is unlike rivals who decided to close their shops.

1. Risk Monitoring

The best approaches to monitoring risks at the yogurt shop include conducting risk audits, analyzing data and involving all the stakeholders in continuous review of their risk portfolios to identify points of vulnerability and how best to solve arising risk threats (Hajmohammad & Vachon, 2016). The management has to be proactive in monitoring risks to reduce possibilities and severity of occurrence.