Australian Ideal College

Registered as Australian Ideal College Pty Ltd

RTO No.: 91679 | CRICOS Provider Code: 03053G
Sydney Campus: Level 7 & 8, 75 King Street, Sydney NSW 2000 Australia
Adelaide Campus: Level 3, 21-23 Rundle Mall, Adelaide SA 5000 Australia
Educating for Excellence Hobart Campus: GRD Floor, 116 Murray Street, Hobart TAS 7000 Australia
T: +61-2-9262 2968 (Sydney) | +61-8-8123 5780 (Adelaide) | +61-3-6231 2141 (Hobart)
E: info@aic.edu.au | W: www.aic.edu.au
Treat risk
Question 1
Within your organisation or one that you are familiar with, find an identified liability risk with one of its lines of products that may,
in rare circumstances, cause injury to a user. Discuss each of the risk treatments and whether they should be applied to
situation.

Question 2
Why is it necessary to select and apply appropriate risk treatments to identified risks?

Question 3
Read the case study, and then complete the question that follow.
Case study
PolyVeya Pty Ltd is a publically listed Queensland-based plastic forming company that makes components for the auto motive
industry. It is well established in Coolangatta and has just finished upgrading to a new warehouse and forming machinery that
will allow it to take on extra capacity. It has 250 staff.

The board of PolyVeya Pty Ltd has approached several large boat builders with the intention of expanding into marine plastics,
a relatively mature sector. The approaches are well received, with some reservations regarding the company’s experience in
the salty, high-UV marine environment. PolyVeya is well financed (underwritten) but is carrying some debt and has minimal
cash reserves. There is a qulity leadership team in place, but it has little experience with marine plastics.

The risk management team at PolyVeya Pty Ltd conducted a risk assessment and found several areas of risk that could affect
its move into the new market. These include:
• Technology risk - although they have upgraded their plant, is it suited to marine plastics?
• Product risk – will the products from the new player be embraced by the market?
• Financial risk – with minimal recerves and some debt from the upgrades, if they are unable to produce a competitive
product quickly, they mat face financial difficulties.
• Reputation risk – what effect will the move to diversify have on their brand?
• Commercial/market risk – given they are moving into a saturated market, how will they perform?
• Management risk – does management have sufficient experience to be able to adjust should the marine sector reject
their new product?

1. List five different types of risk treatment options available to the business and explain how they may use these options
to provide risk coverage for the identified risks.

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