TWU Enterprise Risk Management Project

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COURSE/UNIT INFORMATION Course MBA – UCAM Course Level Postgraduate Module Name Enterprise Risk Management Awarding Body CIQ/UCAM Module Code CIQGM730 Faculty ASSIGNMENT INFORMATION Full/ Part Assignment Full Assignment brief IV by Dr. Vivek Mohan Assessor Assignment due date Turnitin Class ID 31587022 Turnitin Enrolment Key CIQGM701 TO BE FILLED BY THE STUDENT Student Name Student ID Email ID Date Submitted 1|Page ASSESSMENT FEEDBACK TO BE FILLED BY THE ASSESSOR Assessment types Marks Executive Summary 7 Introduction 8 Literature Review 20 Application of Theory to Practice 20 Developing Risk Management 25 Conclusion & Recommendation 10 References 10 Overall Marks 100 Overall Grade Faculty Name Summative Feedback by Faculty for further improvement 2|Page Marks Awarded GRADE DESCRIPTORS 70% and above (Distinction) 60 to 69% (Merit) 50 to 59% (Pass) 40 to 49% (Fail/Redo) Fail Grades 30 to 39% (Module retake) 29% and Below (Module retake) 3|Page The assignment evaluated is of a high to exemplary standard. The work addresses clearly and articulately the assignment requirements and thus meets and satisfies all the learning outcomes (either well or in an exemplary way). The work demonstrates: clear knowledge; references to appropriate academic literature; analysis; critical evaluation; and originality of argument. It is structured and presented to a high (or exemplary) standard. Referencing conventions are fully observed. The assignment evaluated is of a good to a high standard. Substantial knowledge, comprehension and analysis is evident throughout. Arguments presented are clear and focussed with a logical structure in place. There is clear evidence of critical evaluation of a wide range of theories/perspectives from academic literature and some independent thought. The work is well-written and addresses well all of the learning outcomes. Referencing conventions are fully observed. The assignment evaluated is of a fair to good standard. Adequate knowledge, comprehension and analysis is evident throughout. The arguments presented have a logical structure and show some critical evaluation in places, although there may be limited evidence of an independent perspective. There is evidence of some good engagement with some of the appropriate literature. Learning outcomes have been largely met and to an appropriate degree. Referencing conventions are observed. The assignment evaluated is of a basic standard. The arguments presented have some logical structure and are supported by academic literature in most cases. The academic literature used is outside of the suggestions made in the module guide but remains limited. Little critical evaluation is evident, and the work tends more widely towards a descriptive style. Learning outcomes have been addressed in a basic but satisfactory way. Referencing conventions are mostly observed. The assignment evaluated is of a limited standard. Limited use of academic literature and as such knowledge and argument is very weak. A simple descriptive style with no evidence of critical evaluation throughout. Overreliance on simplistic, limited sources. Referencing conventions may not be observed. Some learning outcomes met but in a weak and simplistic way. The work is needs to be developed in greater depth and detail to move to a passable standard at this level of study The assignment evaluated is of an unacceptable standard. There is little or no evidence of knowledge and understanding that is required at this level. Referencing is inadequate or non-existent. The learning outcomes have not been addressed fully and the work requires significant modification to bring it to a passable standard. Enterprise Risk Management This module provides an introduction to the main areas of Enterprise Risk Management. This module also covers Risk Management processes and strategies. Numerous case studies from various business sectors will illustrate the increasing importance of Enterprise Risk Management. Learning Outcomes LO1. Understand and analyse the issues involved in the risk management of an enterprise. LO2. Critically evaluate organisational imperatives for the Risk management process. LO3. Examine the relationship between corporate governance, internal control and Risk management LO4. Critically examine the overall stages of Enterprise Risk management process. Expectations 1. Materials Access All learning materials are provided in the form of a module kit and can be accessed from the Learning Management system (LMS) 2. Learning Hours Students need to be aware of their commitment requirements in regard to study time. In order to give you an indication of that, we have based the following information on the United Kingdom (UK) Higher Education Quality Assurance Agency guidelines. “The notional learning hours associated with qualifications, programmes and individual units of study are based on a broad agreement across institutions that students can expect to spend 10 hours learning on average in order to gain one academic credit unit” (QAA 2006). 4|Page 3. Re-sit If you do not secure a pass, please read closely the feedback and speak with your Course leader(s) or faculty. After consulting the feedback, close attention is essential to rework on the areas of weakness, and then resubmit the work at the next opportunity. As per the QAA requirements, only one REDO is allowed where the marks will be capped at a Pass. 4. Plagiarism All forms of plagiarism are taken seriously, and any suspected cases will be investigated thoroughly. If a case is found proven, then the work will be graded as a fail and the case will be reviewed by the academic committee. 5. Student appeals There are no re-evaluations as the marks are graded and internally verified before release. However, as per our appeals policy, a student can make an appeal to the course leader which will be then reviewed by the academic committee (please check our academic policies and procedures manual for more information) 6. Assignment submission extensions Students can apply for extensions via the LMS based on extenuating circumstances (if any) with evidence (proof) as per our extensions policy. 5|Page General Guidelines 1. Complete the ‘To be filled by the student section’ in the cover page. 2. All assignments must be submitted as an electronic document in MS word via the LMS (Use 12 Times New Roman script with 1.5 spacing between lines) 3. The results are declared only if the student has met the mandatory attendance requirement of 75% and/or minimum 50 % under extenuating circumstances approved and ratified by the academic committee and the examination board. 4. The assignment should not contain any contents with references cited from websites such as ukessays.com, styudymode.com, slideshare.net, scribd.com, Wikipedia but should contain references/citations from credible academic journal and articles. 5. Submit the assignment in MS word document with the file name being: First Name Last Name _ Module Code Example: John Smith_GM701 Your assignment should meet the following requirements. Please confirm this by ticking  the boxes before submitting your assignment Checklist    I have filled the student Information columns in the coversheet. The contents of my assignment have been submitted to Turnitin and I have attached the Turnitin report I have strictly followed Harvard Referencing Style and Citations. 6|Page This assignment consists of one task only. For this task, learners are required to prepare a report based on the case scenario given below and by answering the questions given. Learners are encouraged to refer to credible academic sources to analyze concepts. Please note that the slides provided and discussions conducted during lectures are not the only source of information. Scenario:-Enterprise Risk Management (ERM) report, 100 marks-Maximum 4500 words You are the newly hired safety professional for a successful and growing organisation. As a safety professional we are taught to first identify the hazards and then develop methods to control them, implement the controls, and monitor the results. Under a traditional approach our concern might be limited to preventing workplace injuries and illness claims. Under an Enterprise Risk Management model, we would still be concerned with claims, but would analyze the hazards considering the additional types of risk listed above. From a reputational risk standpoint, an illness claim in which a person dies would most likely result in negative national media attention which would most likely adversely affect sales. While insurance may cover the actual claim costs, the negative press could impact the organization’s ability to fulfil its vision, thwart expansion into new markets, or even jeopardize its ability to stay in business. The development of a robust safety program will not only help prevent this type of claim from occurring, but if a claim was to occur, it will help mitigate the impact on the organization’s reputation. The above example illustrates that while some may see safety regulations as “just another regulatory compliance program,” an organization has a strong incentive to allocate resources to it that go beyond minimum compliance efforts when the program is viewed from an ERM perspective. The challenge safety professionals face lies in demonstrating how their activities support the overall mission and strategic objectives of the organization. For the above scenario, you are asked to choose any organisation (real and existing) which fits the description and develop an ‘Enterprise Risk Management report’ (by answering the questions given below) to highlight Risk based safety programs and all relevant aspects of risk management. This is done in an effort to make your safety team fully understand their roles in Enterprise Risk Management and traditional risk management. 7|Page Suggested resources:• Stevens, J. F., & Bamber, L. (2007, January 1). Enterprise Risk Management for the Safety Professional. American Society of Safety Engineers. • Young, E.J., 2013, January. Risk Managers are from Mars, Safety Professionals from Venus: The Safety Professional’s Role in ERM. In ASSE Professional Development Conference and Exposition. American Society of Safety Engineers. http://stew.ucdavis.edu/files/122331.pdf You MUST follow the Project Report format, which should contain the following sections: 1. Executive Summary: You should summarize your Enterprise Risk Management report briefly (no more than one page of A4 paper). [7 Marks]- Max 300 words 2. Introduction: You should provide a brief introduction on the role of safety in mitigating operational, strategic and reputational risks and explain why risk and safety managers need to collaborate in identifying and controlling risk exposures. [8 Marks]- Max 450 words 3. Literature Review: You should conduct a review of relevant academic literature using at least 6-8 articles taken from reputed research journals/ article publications, as well as in addition consider any other secondary literature reports, company data/ any other relevant data, to critically analyze the available literature. The literature review should be based on: a. An analysis on the current issues involved in Risk Management in the industry based on which your chosen organisation operates. [8 marks]- Max 400 words b. A critique on the traditional barriers to risk based safety programs. [12 marks]- Max 600 words 4. Application of theory to practice: You need to compare actual practices in the case study organisation with the key academic thinking established in the review of literature. It may point out similarities and differences, agreements and contradictions, arguments and counter arguments, and suggest explanations for these relationships. The focus of this section needs to be: 8|Page a. Evaluate the factors and trends that define your chosen organisation’s imperative to change and explain their relevance in implementing risk based safety programs in your chosen organisation [8 Marks]- Max 400 words b. Apply the RMA’s Enterprise Risk Management framework to your chosen organisation and examine the relationship between corporate governance, internal control and the various ERM competencies as applied to your chosen organisation. [12 Marks]- Max 600 words 5. Developing Risk Management Using the template given below, develop a risk management plan listing at least 6 Key change/Issues relevant to your chosen company and other than the ones listed in the template. a. Explain each change elaborating potential effect & risks. Specify the additional controls needed to ensure successful to implement the change. You may mention the job title responsible for action and explain the reason. . [15 Marks]-Max 750 words b. Describe the relationship between the key change and focus on the sequence to be adopted for the change. . [10 Marks]-Max 500 words 9|Page 6. Conclusions and Recommendations: You should summarize the main findings, including their implications, and provide recommendations that directly relate to your analysis. [10 Marks]-Max 500 words References: You should use the Harvard Referencing System (HRS) correctly throughout in your report. [10 Marks] (No word count) (START WRITING YOUR ANSWER FROM THE NEXT PAGE…..) 10 | P a g e 11 | P a g e Enterprise Risk Management LO1. Understand and analyse the issues involved in the risk management of an enterprise. Learning Outcomes ▪ LO1. Understand and analyse the issues involved in the risk management of an enterprise. ▪ LO2. Critically evaluate organisational imperatives for the Risk management process. ▪ LO3. Examine the relationship between corporate governance, internal control and Risk management. ▪ LO4. Critically examine the overall stages of Enterprise Risk management process What is Risk Management ? Risk management can be defined as: “The eradication or minimisation of the adverse affects of risks to which an organisation is exposed.” ACTIVITY Going by this definition, lets quickly list all the Risks you are aware that your organisation is exposed to now Traditional approach to managing risk Traditional approach to managing risk RISK MANAGEMENT RISK REDUCTION RISK ASSESSMENT Activity Characterisation Option Analysis    Hazard Identification Monitoring   Decision Making Risk Estimation RISK EVALUATION RISK ANALYSIS Implementation Audit or Review Hence Traditionally…… Risk assessment can be a ‘very straightforward process based on judgement requiring no specialist skills or complicated techniques.’ This approach is commonly known as qualitative or subjective risk assessment. WHY RISK AND HEALTH AND SAFETY? HSE Regulation ▪ ‘Every Employer shall make a suitable and efficient assessment of:a) The risks to the health and safety of his employees to which they are exposed whilst they are at work. b) The risks to the health and safety of persons not in his employment arising out of or in connection with the conduct by him or his undertaking; ▪ For the purpose of identifying the measures he needs to take to comply with the requirements and prohibitions imposed on him by or under the relevant statutory provisions.’ Its all about Hazard Identification! The potential to cause harm. Harm including ill health and injury, damage to property, plant, products or the environment, production losses or increased liabilities. Hence, Risk in H & S is the likelihood that a specified undesired event will occur due to the realisation of a hazard by, or during work activities or by the products and services created by work activities. ENTERPRISE RISK MANAGEMENT Today’s organizations are concerned about: ▪ Risk Management ▪ Governance ▪ Control ▪ Assurance (and Consulting) Why is ERM Important? ERM supports value creation by enabling management to: ▪ Deal effectively with potential future events that create uncertainty. ▪ Respond in a manner that reduces the likelihood of downside outcomes and increases the upside. The ERM Framework ERM considers activities at all levels of the organization: ▪ Enterprise-level ▪ Division or subsidiary ▪ Business units and processes The ERM Framework Enterprise risk management requires an entity to take a portfolio view of risk. The growing scope of Enterprise Risk Management Enterprise Risk Management LO2. Critically evaluate organisational imperatives for the Risk management process. Learning Outcomes ▪ LO1. Understand and analyse the issues involved in the risk management of an enterprise. ▪ LO2. Critically evaluate organisational imperatives for the Risk management process. ▪ LO3. Examine the relationship between corporate governance, internal control and Risk management. ▪ LO4. Critically examine the overall stages of Enterprise Risk management process Its all about Hazard Identification! The potential to cause harm. Harm including ill health and injury, damage to property, plant, products or the environment, production losses or increased liabilities. Hence, Risk in H & S is the likelihood that a specified undesired event will occur due to the realisation of a hazard by, or during work activities or by the products and services created by work activities. Hazardous situations Examples ; ▪ slippery or uneven walking surfaces, ▪ cramped working conditions, ▪ badly ventilated areas, ▪ high locations, ▪ noisy locations, ▪ poorly lit areas, ▪ confined spaces. Hazardous substances ▪ Examples; ▪ corrosive and toxic chemicals, ▪ flammable and explosive materials, ▪ dangerous gases and liquids, ▪ radioactive substances, ▪ particulates, ▪ bacteria ▪ viruses. Hazardous activities ▪ Dangerous tasks ▪ Unnatural postures and movements ▪ Heavy lifting ▪ Repetitive work ▪ Interpersonal conflicts ▪ Bullying Hazardous events ▪ Examples ▪ Explosions ▪ Implosions ▪ Fires ▪ Leaks ▪ Falling objects ▪ Equipment malfunction PRINCIPLES OF RISK ASSESSMENT The concept of risk asks two future oriented questions: ▪ What is the probability that a particular hazardous event or exposure will actually occur in the future? ▪ How severe would the impact on health and safety be if the hazardous event or exposure actually occurred? Assessing the Risks - Subjective risk assessment ▪ Qualitative risk assessment involves making a formal judgement on the consequence and probability using: Risk = Severity x Likelihood Example The likelihood of harm may be rated 1. High Where it is certain that harm will occur 2. Medium Where harm will often occur 3. Low Where harm will seldom occur Example The likely effect of a hazard may for example be rated: 1. Major Death or major injury or illness causing long term disability 2. Serious Injuries or illness causing short-term disability 3. Slight All other injuries or illnesses Assessing the Risks Risk = Severity of Harm x Likelihood of occurrence ▪ This simple computation gives a risk value of between 1 and 9 enabling a rough and ready comparison of risks. ▪ In this case the lower the number, the greater the risk, and so prioritises the hazards so that control action can be targeted at higher risks. Sample Risk assessment RISK Template & RISK Matrix discussion (Provided separately) ALWAYS NOTE:- Worth noting! ▪ The risk rating is not the most important element ▪ Deciding on and implementing controls to minimise or eliminate risk is the most important aspect
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COURSE/UNIT INFORMATION
Course

MBA – UCAM

Course Level

Postgraduate

Module Name

Enterprise Risk Management

Awarding Body

CIQ/UCAM

Module Code

CIQGM730

Faculty
ASSIGNMENT INFORMATION
Full/ Part Assignment

Full

Assignment brief IV by

Dr. Vivek Mohan

Assessor
Assignment due date
Turnitin Class ID

31587022

Turnitin Enrolment Key

CIQGM701
TO BE FILLED BY THE STUDENT

Student Name
Student ID
Email ID
Date Submitted
1|Page

Executive Summary
This report discusses Enterprise Risk Management with special reference to General
Motors Corporation, a company that operates in the automobile industry, manufacturing and
selling gasoline and electric cars. The report introduces the role of safety management in
mitigating strategic, operational, and reputational risks that face organizations. Safety acts as a
watchdog that ensures firms comply with legal and compliance procedures covering workplace
safety, client safety, and product health safety, among others. In addition, safety management in
firms reduces risks by inculcating a safety culture in the wide organizational culture.
The report analyzes current issues that affect risk management in the automobile industry and
critiques traditional barriers that inhibit risk-based safety program implementation in
organizations. Some of discusses contemporary issues affecting risk management in the
automobile industry include high safety, security, and obsolescence standards. Traditional
barriers to risk-based safety measures include dichotomy in organizational structure, rigid
organizational culture, and conceptual difference between safety and risk management. Also, the
report discusses factors and trends imperative to General Motors' change. They include
aggressive competition, global workplace safety strategy, and bureaucracy to agility
organizational culture trends. The report also applies RMA's Enterprise Risk Management
framework in General Motors.
Additionally, the report develops a risk management plan containing six critical change
issues, including technology advancement, strategic risk management, corporate social
responsibility, and generic cost leadership strategy in human capital management. It also
discusses the relationship between the key change issues regarding implementation sequence to
achieve sustainable organizational change. Finally, the report provides a conclusion and
recommendations on areas General Motors can improve to promote enterprise risk management
and mitigate strategic, reputational, financial, and reputational risks.

2|Page

Introduction
Safety refers to the art and science devoted to recognizing, assessing, and controlling
stresses and factors in the workplace (Kontogiannis et al., 2019). It simply involves providing a
safe work environment. Safety in General Motors company plays a critical role in preventing or
reducing operational, reputational, and strategic risks. Operational risks relate to failed internal
processes, systems, and inadequate human capital in an organization. Typically, operational
failures emanate from systems failures, employee errors, fraud activities, non-compliance
activities, and events that disrupt organizational processes.
Strategic risks relate to unfortunate events associated with the long-term objectives of an
organization. Directors may fail in one way or another when formulating and implementing an
organization's fundamental goals, resulting in strategic risks (Kontogiannis et al., 2019). On the
other hand, reputational risk relates to the brand equity or overall image of an organization. In
general, reputational risk pose a danger or threat to the good image of a firm. Such risk may
occur due to company actions, employee operations, and third-party operations. Reputational
risks affect the safety issues and programs of a firm by creating a dented public image.
Safety in an organization incorporates occupational safety, meaning that safety is a
multidisciplinary field covering all organizational aspects (Álvarez-Santos et al., 2018). As a
result, safety compels safety professionals to identify and mitigate risks related to business
activities and may affect the health and wellbeing of employees, business associates, and the
public. Safety ensures safety managers coordinate and execute safety programs and
environmental health required by regulatory authorities and labor agencies.
In particular, safety mitigates strategic, operational, and reputational risks by acting as a
watchdog that ensures company compliances with policies and standards regarding stakeholder
safety and wellbeing (Álvarez-Santos et al., 2018). Also, safety ensures that organizations create
and embrace a safety culture, which goes far to mitigate reputational, operational, and strategic
risks. Safety culture mitigates such risks by ensuring that the organization and employees take
responsibility for actions that jeopardize safety. Directors and decision-makers in organizations
that embrace a safety culture ensure strategies and decisions consider safety, which helps reduce
strategic risks.
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Safety culture ensures organizational members understand safety programs, systems, and
procedures that reduce accidents at the workplace. For instance, a safety culture compels
organizations to provide a safe work environment, thus reducing accidents and risks that may
arise (Álvarez-Santos et al., 2018). Therefore, safety helps organizations mitigate risk by
ensuring compliance and avoiding financial losses from lawsuits and legal actions resulting from
non-compliance. Finally, risk and safety managers need to work collaboratively because safety
and risk management are related. It makes work easy to identify and prevent the occurrence of
events that may result in risks.
Literature Review
Current Issues in Risk Management in Automobile Industry
General Motors corporation operates in the automobile industry, manufacturing, and
marketing vehicles. GM's common brands include Pontiac, Buick, Chevrolet, Saturn, Saab,
Cadillac, and Hummer. Risk management is very critical in the automobile industry. It is crucial
because unaddressed risks result in safety incidents, missed production targets, and vehicle
recalls.
Current issues in the automotive industry related to risk management involve aging
assets, safety hazards, and security threats. These issues affect revenues, employees, plants,
vehicle quality, and the intellectual property of organizations operating in the industry (Banks et
al., 2019). Also, safety hazards, security threats, and aging assets issues in the automobile
industry expose companies to reputational risks as they can tarnish brand name and reputation.
Risk management in the automobile industry involves safety, quality, security, and obsolescence
compliances. Non-compliance with such issues erodes customer loyalty and trust.
Safety (focus on industrial safety programs)
Safety in the automobile industry relates to overall equipment effectiveness, contributing
to fewer workplace accidents and less unscheduled downtime. Companies view safety as an
additional burden that increases overall production cost, despite being critical in automotive
operations (Banks et al., 2019). Top performers in the automotive industry like General Motors
experience fewer workplace accidents as they uphold safety, which reduces risk exposure. The
best safety practices in the automobile industry relate to culture, capital, and compliance. The
industry compels automakers to shut down facilities when safety concerns are in play.
4|Page

Quality (Attain better visibility using manufacturing execution system)
Quality in the automotive industry is a critical issue in risk management. It can never be
sacrificed even when production targets are high than the workforce. To manage risks related to
quality, automakers require real-time information visibility (Banks et al., 2019). Technological
software like manufacturing execution systems is crucial among automakers to manage risks
associated with quality compliance. Quality compromises in the industry can lead to car recalls,
which affects the reputation of the company. For instance, General Motors recalled over 800,000
cars in 2014 due to a quality compromise with the ignition switch.
Obsolescence and security
Risk management in the automotive industry touch on software and equipment
obsolescence, which contributes to lost productivity and downtime. Financial and operational
risks resulting from obsolescence in the automotive industry are so high (Banks et al., 2019). As
a result, automakers tackle the issues of obsolescence by managing a proactive life-cycle
management. On security, the automotive industry requires automakers to conduct security
assessments to understand risk exposure and device mitigation techniques. A common technique
to manage security risks is defense-in-depth. It addresses security at physical, policy, network,
computer application, and device levels.
Critique on Traditional Barriers to Risk-based Safety Programs
Over the past few years, researchers have argued that there is a need to separate safety
programs from traditional compliance-based systems to risk-based programs (Bhupathi, 2016).
One way to switch from traditional compliance-based systems to risk-based systems is to create
risk management experts in organizations. In general, organizations should approach safety with
a mindset of risk management rather than compliance-based programs.
Today, organizations align safety programs with enterprise risk management, meaning
safety standards are geared towards a systematic and integrated risk management approach. As a
result, risks that face organizations are managed and controlled within an integrated framework
(Bhupathi, 2016). Some of the flaws or barriers of traditional compliance-based safety programs
include the belief that reducing accident frequency according to Heinrich's Injury Pyramid will
reduce the amount of harm.
5|Page

Another barrier is that potential risks or incidents should be treated equally without
periodizing one that carries significant severity (Bhupathi, 2016). Other barriers include blaming
workers for accidents, dependence on low-level control to manage incidents, and reactive instead
of proactive measures like incidents investigations and lagging indicators to assess the firm's
performance.
Compliance-based programs stress adherence to safety procedures and policies.
However, it does not mean that firms that adopt risk-based safety programs ignore compliance
functions because they are elements of the broader mission to manage and control organizational
risks (Bhupathi, 2016). Therefore, risk-based safety programs go beyond compliance procedures,
regulations, and policies. However, its application may be challenging due to certain traditional
barriers associated with:
1. Difference between safety and risk management
Safety management involves the use of policies, principles, framework, processes, and
measures to prevent incidents, accidents, and injuries that negatively impact a firm.
Organizations implement safety management guidelines and systems to keep the work
environment free from harm. In contrast, risk management relates to a systematic and integrated
approach to managing uncertainties that face an organization using an integrated framework.
It involves identifying, measuring, and prioritizing risks to coordinate and apply resource
economically in the process of minimizing, evaluating, and controlling the impact of unfortunate
events (Spadaccini, 2010). The disparity between the two concepts makes it difficult to apply
risk-based approaches to safety programs. However, organizations can utilize enterprise risk
management systems to manage the barrier.
2. Organizational culture
Typically, organization culture acts as a moderator of all organizational aspects. It
dictates what to accept and implement in an organization. Organizational culture represents who
and what the firm supports (Spadaccini, 2010). Therefore, it is not easy to implement risk-based
safety programs in organizations that do not embrace such a culture. However, this barrier is
manageable because organizations can use leadership to drive cultural change.
3. Organizational Structure
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Most organizational structures consider safety management as an operation function
under the control of the Chief Operations Officer. Similarly, such organizational structures
consider risk management as a finance function that the Chief Financial Officer should control
(Spadaccini, 2010). While managing risks, finance managers report to the treasurer or chief
financial officer.
On the other hand, operations managers report to the COO. The similarity of operations
and finance functions leaves safety managers hanging and confused because they cannot say to
the Chief Operations Officer (Spadaccini, 2010). This structural dichotomy makes it hard to
implement a risk-based approach to safety programs in organizations. However, separation of
function in organizations with such structures can permit the implementation of risk-based
approaches to safety programs.
Application of Theory to Practice
Factors and Trends that Define General Motors
In General Motors corporation, safety is the responsibility of every organizational
member. The company implements Speak Up for Safety Programs, encouraging suppliers,
business associates, employees, and dealers to report potential vehicle safety issues (Olson and
Wu, 2015). Some trends and factors affecting General Motors concerning implementing riskbased safety programs include stiff competition, organizational culture, and global workplace
safety strategy.
Global workplace safety strategy
General Motors implements a comprehensive global workplace safety strategy that
focuses on data, culture, knowledge, workplace safety systems, and risk mitigation dimensions in
promoting a safe work environment (Olson and Wu, 2015). The company believes that safety
begins with decisions that strengthen enterprise safety culture. One of the company's initiatives
to support the culture includes deep dive into safe decision making.
The knowledge dimension focuses on enhancing employees' ability to identify hazards
and risks in the work environment (Fraser et al., 2014). In general, the company sees the safety
of employees and customers as a number-one priority through the global workplace strategy.
This perception enables the company to gain a real-time understanding of the relationship
7|Page

between risks, safety procedures, and risk control issues. These factors encourage the
implementation of risk-based safety programs.
Increasing Competition
Globalization and growth in e-commerce expose General Motors to stiff competition,
which affects the company's prospects and overall financial performance (Fraser et al., 2014).
General Motors is among the leading automakers in the automobile industry with a strong image
and wide vehicle assortment. The company focuses on innovation, with Cruise being GM's
global segment that develops and commercializes autonomous vehicle technology. Despite
innovative efforts, General Motors face stiff competition from inte...

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