Presentation of module 7

1. This project is funded by the European Union
Module 7: Risk Analysis
I. RISK MANAGEMENT
Basically, the goal of risk management is to identify potential problems
before they occur and have a plan for addressing them. Risk management
looks at internal and external risks that could negatively impact an
organization, company or start-up.
II. INTRODUCTION
Risk management is important in an organization, company or start-up
because without it, a firm cannot possibly define its objectives for the future.
If a company defines objectives without taking the risks into consideration,
chances are that they will lose direction once any of these risks hit home.
Risk is the possibility of a hazardous event occurring that will have an impact
on the achievement of objectives, in this training course we will focus in how
the risk can affect new business or companies in an early stage and when
they start to trade. Risk is measured in terms of consequence (or impact) and
the likelihood of the event or issue. Qualitatively, the risk is considered
proportional to the expected losses which can be caused by an event and
to the probability of this event. Quantitatively, it is the product of the
probability of a hazardous event and the consequences.

2. We will review in this training course general views about risk perception and
risk communication are discussed that help decision making. Also, we will
explain risk management and risk governance along with a basic view
about the probabilistic risk assessment and alternative approaches to risk
analysis.
Finally, we will provide the basic concepts about risk management, in order
to provide the knowledge to manage the risk in SME´s or startup and avoid
all kind issues in all the stage, more in particular in the early steps of a
company.
III. LEARNING OBJETIVES
1. Identify and categorise the various risks faced by our organization,
company, startup or business idea.
2. Explain the various risk control measures available for our business.
3. Design a basic risk management program for our business organization.
4. Suggest ways to finance risk.
5. Study different essentials mechanisms in risk management.
6. Describe the management of risk according to our business model,
project or company.
IV. DESTINATARIES
Minimum 20 female entrepreneurs or owners of Turkish SMEs
V. DURATION
The webinar training course will be next Thursday 7th of January 2021 from
15:30 to 20:00 (4 hours online training – 30 minutes coffee time).

3. VI. CONTENT STRUCTURE AND SUMMARY
We are trying to provide a general analysis of the risk in the administration and
management of a businesses. The idea is to study different scenarios of how to
manage risks to ensure the self-sustainability of a business in the long term.
¿WHAT IS THE RISK?
The concept of business risk is the probability that something will happen that will
stop you from getting the result you were expecting.
In other words, risk is the possibility of suffering an economic loss in the
development of any type of business activity which, in theory, supposes a financial
gain or profit. In conclusion, the risk is a permanent phenomenon of all businesses.
The Danish Nobel Award winner in Economy Niels Bohr, said “Making predictions is
exceedingly difficult, especially if you are referring to the future”. He is telling us
that predicting the end result is always difficult.
Risk is always part of a business activity, taking into account that any business is
permanently exposed to multiple risks in all sectors. Doing business implies the
possibility of losing the investment - the risk could appear because of internal or
external factors.
We must consider some of the elements that influence from moment of creating a
company, for example: the selection of the business sector, the service / product
to commercialize, the sources of investment / funding, the personal selection, the
selection of the providers, and in general the election of clients.
Taking into account the behaviour of the enterprise’s markets, we can conclude
that the risk is a combination that uncertain events can occur and affect a project
directly. This combination can have a positive or negative effect on project
objectives; risk is divided into three fundamental elements:

4. A. THE OCASSION
This element outlines the incident how it may happen (e.g., the denial of a bank
loan).
B. THE EFFECT
This element reflects the seriousness of the incident, so, the level of impact in the
goals of the business. (e.g., the company is in danger of going bankrupt because
they do not have money for to buy / paid providers).
C. PROBABILITY
The company must have an organized financial area, so, it needs a projected
cash flow that allows them to visualize the financial situation of the business in the
short, medium, and long term.
TYPES OF RISK
1. TECHNICAL
This is directly in relationship with the performance capacity of the business.
2. TIMELINE
This type of risk is not necessarily under the manager’s control, in this case the final
decision could be taken by the owners or executive with higher level in the
company.
3. SUSTAINABILITY
The objective is to achieve sustainability in all areas of the company. (eg. Take an
introduction on the green economy).
4. COST
The entrepreneur must be able to evaluate the financial cost of the risks linked
directly with the cost of the business idea.

5. 5. SCHEDULE
it is necessary to have control of the timeline in order to carry out the organization,
planification and execution of the business, so we need to work with a deadline to
fulfil the goals.
EVALUATION OF RISK
The business projection risk management must be viewed from two perspectives:
 SHORT TERM
It consists of dealing with the immediate business objectives and goals (eg., weekly
/ monthly production targets).
 LONG TERM
Making sure subsequent business ideas succeed by attending to potential
problems at the beginning of the business.
An example would be to watch the production area in the business and be
capable of planning what should happen. Consequently, the businesswoman
should be able to identify both the short- and long-term effects of your risk
management projection business plan.
This means that you need to plan cautiously and identify the potential risks in your
business. If you understand the risks, you can make plans to deal with them,
however, risk management does not stop there.
From our experience we think that you need to analyse the following six-step
approach to risk business:
1. PLAN RISK MANAGEMENT
The first step in the risk business process is to establish a risk business plan, this plan
should describe: risk, probability, and contingency.

6. The plan should include a risk breakdown structure that details the broad
categories of risk in your business, for example: customers, providers, and market.
The plan should also define risk boundaries (the point at which a certain risk
requires action). Finally, your plan should include the risk budget (the funds
available, the cash flow projection).
2. IDENTIFY RISK
According to our experience, the businesswoman should carefully examine
business documents, including the Business Plan (Briefing) and the scope of work to
determine possible risks.
For example, when setting goals for the organization, planning and execution of
the business, you may face a challenging deadline that could be difficult to meet.
The technique we recommend for risk identification is to consult a risk assessor
specializing in business enterprise and get them to assess your business. Feedback
from this advisor will provide you with objective information based on documents,
data, and projections specific to your company. Finally, if the identified risks and
recommendations from the assessor are taken on board by your company, they
will reduce future risk for your business.
3. QUALIFY RISKS
Risk qualification is based on probability and impact. Probability is the chance of
something occurring and can be measured as a percentage (%). For example, the
probability or likelihood that something will happen is often ranked on a zero to
one scale (0.4 equating to a 40% probability if the event occurring).
Impact can be measured using metrics such as budget, schedule, cost, or quality.
It can be expressed using a scale (for example, one to five, with five being the
highest impact on project objectives) or using terms such as high, medium, or low.

7. 4. QUANTIFY RISKS
A quantitative analysis quantifies the possible outcomes and the likelihood of
achieving the specified objectives or goals. It also allows you to calculate
contingency reserves.
So, you can conduct a quantitative analysis using statistical data, as well as various
techniques.
5. PLAN RISK RESPONSE
In order to determine your response to the identified risks, you need to look at the
causes of these risks.
Some strategies for dealing with risks or threats are:
•ELIMINATE THE RISK
Choose a lower risk alternative.
•DEFLECT
Pass on the results of the risk to a third party, such as insurers.
• REDUCE RISK
This implies taking action to reduce either the impact or probability of a risk, or
both.
• ACCEPT RISK
Decide to accept the risk without taking any action. The risk is simply noted and
documented. Active acceptance involves creating a contingency plan, reserve
budget, and retroactive management plans.
Strategies for dealing with positive risks (opportunities):
• ADVANTAGE
Business takes full advantage of a positive event.
• SHARE OPPORTUNITIES
Working together with another business or partner to take advantage of an
opportunity, for example form a cluster.

8. • INCREASE THE ODDS
Take steps to increase probability of positive opportunities to benefit the business.
• ACCEPTANCE
Note and document any potential opportunities without taking any further action.
You need to have sufficient contingency resources to implement your chosen risk
response. Project documents need to be updated the with the new activities
involved in your response.
A simple technique Pritchard proposes for generating risk responses is
brainstorming. This involves presenting the risks to a group of people and recording
their responses. This point is to generate ideas for further evaluation. The resource
requirements for this technique are relatively low, because there are no costs, but
a group session often requires some time to complete.
6. RISK MONITORING
This involves implementing and monitoring your risk management plan. Project risks
should be continually monitored in order to respond effectively and to check if any
new risks have appeared. If your risks change or your responses are not giving
results you may have to reassess and review risks and contingency plans.
VII. METHODOLOGY
The training course will be in English language and using an online platform,
Zoom. Also, we will provide material related to the subject of the training
courses as practical exercises and the presentation in a PowerPoint
document.

9. VIII. CV TRAINER LUIS LOPEZ TASSARA
Educator
I have worked as a teacher in third level and post graduate education in the two
main business schools in Perú: ESAN Graduate School of Business
(http://en.esan.edu.pe/ ) and USIL, the University of San Ignacio de Loyola
(www.epg.usil.edu.pe/ ).
I dictated courses on behalf of ESAN and USIL in different academic institutions and
universities at national level all around the Perú. the courses were commissioned by
financial institutions such as banks, micro finance, and micro enterprise institutions,
and were aimed at managers and directors of small to medium sized companies.
we also ran diploma courses such as management & administration of your own
business, for high-ranking officers of the peruvian air force, peruvian navy and
peruvian army.
Part of my work consisted in planning, organizing, and executing round table
discussions, forums, study and investigation sessions, course content, academic
and cultural seminars and tutorials, conferences, seminars, diplomas, and
programs, in house consulting for businesses, technical academic content of
postgraduate and master courses both at national and international level.
Consultant & Advisor International Marketing & Foreign Trade
In my work as consultor and advisor to the trade & investment office of the
peruvian embassy in the UK, I have planned, researched, and presented several
market studies evaluating the importation, distribution, and sale of peruvian
products to the UK markets, andean grains such as quinoa, chia, maca, kiwicha,
cañihua.

10. These market studies are submitted to the government ministry of foreign trade
(MINCETUR-PERÚ) and are the basis upon which the department of foreign trade
plans, organizes and executes academic and technical activities aimed at
informing and improving standards of exports of the relevant peruvian business
sectors. my findings are also used to help strengthen the presence of peruvian
products, Marca PERÚ, in the British market. Likewise, I have planned, organized,
and ran a 12-week promotional campaign for peruvian quinoa in dublin (Ireland).
Social Responsibility and Inclusion
producer and presenter of a social inclusion television programme, espíritu
emprendedor(www.youtube.com/user/espirituemprendedor1/videos?shelf_id=0&v
iew=0&sort=dd), which aimed to promote enterprise among self-employed and
small businesses focussing mainly on the most disadvantaged sectors of peruvian
society.
director of ICFEM (Instituto Cultural de Formación Empresarial), an academic
institution whose principal objective was to plan, organise and present projects
such as technical and social responsibility and inclusion programmes in mining and
agricultural areas in the country.