Question:

You are a management specialist and acting within your role as an external consultant, you have been invited to advise the Aberdeen based company (Windsome) how they can strengthen and foster a culture of risk management within their company across all areas and involving all staff.

Windsome rents and supplies a range of high-quality equipment for power generation, lifesaving, lifting and tooling in a range of markets from Offshore to Subsea, Onshore operations and renewables.

Their clients view them as a key part of the supply chain as they rely on them to provide access to the right tools, plant and equipment, as they require them.If this does not happen, it becomes impossible for them to complete their projects on time and within budget.

So Windsome has prided itself on making sure its business units focus on delivering cost effective equipment, tooling and lifting solutions to companies.This is reflected in its Mission Statement which is "Right First Time, On Time, Every Time".

The company employs 240 people full time and has access to a further 30 specialists of various disciplines who can be called upon to come in on short term contracts when needed.

Windsome was set up by the Founder/Owner in 1977 and his son now has a key role as Operations Director.It has a traditional hierarchal structure and low rates of staff turnover.

Most of its staff work in Aberdeen, about 120 in total split between a new Head Office building in a new business park outside Aberdeen and in a storage and maintenance facility based about ten miles west of Aberdeen where they have expanded to acquire other space within the base which is owned by another company.It has a small fleet of vehicles but has an arrangement with a local haulage company for larger pieces of equipment.

The rest of the staff are based in Bergen, Norway and Baku, Azerbaijan.This global presence has been client-led and Windsome are keen to make sure they can be wherever their clients need them.

Context

The last few years have been difficult. Operating in a challenging economic environment, the Owner/Managing Director is concerned about the future prospects of the company.

He has invested heavily in the business over the last ten years increasing stock and storage, moving to a new Head office, and setting up in Baku took much longer than anticipated which caused problems with the clients they had promised to support.The impact on their reputation could be damaging.A few contracts with long term clients have been curtailed because they have curtailed activities, decided not to proceed with new projects etc. and this has hit their profitability.

Staff morale is not good, people are worried about their jobs and instead of pulling together, he feels that productivity has fallen and some key processes are not being followed.For example, 'near miss' incident reporting was found to be inaccurate for two months out of the last six.There has also been some theft and criminal damage in the Aberdeen storage facility which caused delays in sending equipment out to Bergen and the local office were left in the firing line with the client.

A competitor has recently gone into liquidation which is good because it should increase Windsome's market share, but with the overall reduction in new business, this might not bring the benefits it might have in the past.

The Managing Director has been approached by a major client who wants to start drilling offshore in Western Australia and has asked Windsome to bid for the contract to supply the rig.This means establishing another overseas base in Perth.It's an exciting prospect and the Managing Director feels this would give the business a real 'lift' and sense of forward momentum.

However, it will add more risk to the business and because he knows only too well that risk and reward go hand-in-hand, he wants to make sure they are strong enough to deal with the impact this will have.It's been a long time since anyone took a step back and looked at how effective the risk management was in Windsome and crucially whether or not the business has the culture of risk it should have.

This is what he now wants to achieve.

You have been appointed as a risk management consultant and have spent the last few weeks in the Company reviewing the way risk is managed across all parts of the business to come up with proposals about how a 'culture of risk management' can be achieved in Windsome that will support the strategic growth of the business.

I need guide how to prepare a report that addresses the elements below:

Critical evaluation of the organisation's key challenges and the role of risk management in enhancing its performances;

Description of the importance of modern risk management in developing a risk-based culture that may allow the organisation to create superior performance;

Critical evaluation of the Windsome culture and how the organisation can make HSE compliance as a core value of its business activities;

Description of risk architecture and critical examination of the extent to which the organisation's risk architecture contributes to its risk culture;

Evaluation of the importance of value drivers and recommendations of how the organisation can manage enterprise risks using its value drivers.