COURSE: ENTERPRISE RISK MANAGEMENT

PROJECT: STORA ENSO

Question Plotting of risks in the heat map (in the template excel file)
1.

Impact Calculation –
Probable Impact
Risk Impact Score
(in Million USD)
Risk 1: Data hacking 1.7 to 1.9 2
Risk 2: Use of old
technology 3.1 to 3.4 Mn 4
Risk 3: Declining sales 4.5 to 4.7 Mn 5
Risk 4: New regulations 2.4 to 2.6 Mn 3
Risk 5: Consumer
preferring biodegradable
plastic packaging 0.6 to 0.8 Mn 1

Impact Scale
1 0- 0.9Mn
2 1.0 - 1.9 Mn
3 2.0 - 2.9 Mn
4 3.0 - 3.9 Mn
5
4.0 Mn and above

Likelihood Calculation –
Likelihood – Impact Table & Heat Map –

RISKS LIKELIHOOD IMPACT

Risk 1 Data hacking 2 2
Risk 2 Use of old technology 4 4
Risk 3 Declining sales 4 5
Risk 4 New regulations 4 3
Consumer preferring biodegradable
Risk 5
plastic packaging 3 1

Risk 3
5

Risk 2
4
IMPACT

Risk 4
3

Risk 1
2

Risk 5
1
1 2 3 4 5
LIKELIHOOD
Question 2. Calculation of risk scores

Risk Register –

RISKS LIKELIHOOD IMPACT VELOCITY RISK SCORE

Risk 1 Data hacking 2 2 High 4

Risk 2 Use of old technology 4 4 Low 16
Risk 3 Declining sales 4 5 Medium 20
Risk 4 New regulations
Consumer preferring 4 3 High 12
Risk 5 biodegradable plastic 3 1 Low 3

Question 3. Prioritisation of the risks and justification why the risk is important

PRIORITY
RISK JUSTIFICATION
LEVEL
Declining sales is not affordable situation for any company as it affect
P1 Declining sales
the business immediately.
Use of old technology will create excess loss of raw material and it leads
P2 Use of old technology to increase in Cost for production, which affect the companies profit
adversely.
P3 New regulations New Regulation can affect the day to day transections.
P4 Data hacking Data hacking can impact the business function immediately.
Consumer preferring Consumer is king and their preferring of biodegradable plastic
P5 biodegradable plastic packaging is impact severly but chances of loss of customer due to
packaging preference is low.
Question 4. 1 aggravating factors for each risk -the forest produce industry creating an impact
on their revenue generation

RISKS AGGRAVATING FACTOR

Data hacking is cyber security risk and if data hacking is

Risk 1 Data hacking done then the company can loose their goodwill and
reputation and can lost the faith of investor and public.
Old technology cannot survive in the competition of new
technology. If the competitor adopts the new technology
Risk 2 Use of old technology then the company cannot match the production level and
quality of product in comparision. Can also lead to loss of
sales.
Company profit can be impacted and hence employee
Risk 3 Declining sales
satisfation can go down
This can lead to missing of deadlines and impacts
Risk 4 New regulations
reputation if penaliesed by Government.
Consumer
Customer requirement to be fulfilled by competitor and
preferring
Risk 5 this can lead to loss of sale and using old technology for
biodegradable
packaging cost more.
plastic packaging
Question 5. Four mitigation strategies to reduce the risk posed by the aggravating factors

RISKS MITIGATING STRATEGIES

1. IT Manager should access the systems and network security
2 . Should fix the virus scanner and should use private network to
Risk 1 Data hacking avoid such hacking scenario.
3. Should educate the team to not to acess the unknown website or
links
1. Company should do research for available best option for
machine and compare it and purchase the latest technology
2. Technical team should ensure to optimum use of latest
Risk 2 Use of old technology
technology.
3. Technical team should keep eye on new technologies introduce
in the market and analyse the same.
1. Sales team should ask for market research through marketing
team.
2. Analyse the available market opportunity for sale and should
Risk 3 Declining sales
continue to endevour the same.
3. Do customer survey and reslove their issues on time to get more
sales from existing customer and can get referreals too.
1. Legal & Tax Team should be aware of the changes or new
introduction of Law or Tax by Governement .
2. Team should intearct with Local Tax Consulatant as well as
Risk 4 New regulations International Tax Consultant for changes and incroporate the same
in the company.
3. Meet the deadlines to file the necessary documents with
Government department as may needed.
1. This can be done through marketing team by conducting
customer surveys
Consumer preferring
2. Understand the customer choice and requirement and design the
Risk 5 biodegradable plastic
product likewise.
packaging
3. Accept the changes requested by customer and implement in the
production line.