BKAI 3043RISK MANAGEMENT PROJECT

GROUP BDr. Rose Shamsiah Bt Samsudin

Prepared by: MaxisONG WEI LING 220125NG HUEY YEE 219912MUHAMMAD HUHSRIN BIN MOHD YUNUS 221952

Introduction

• This project involved the assessment of risk and risk management process as discussed in the classroom. We need to choose an organization and we decided to choose MAXIS BHD and in this project we will discussing on the risk factors that can impinge on MAXIS BHD ability to achieve its desired goals and objectives. The reason why we choose MAXIS BHD is because this organization are listed in Bursa Malaysia and they have their own risk department where handling all possible risk that will occur in the organization

Introduction

• Maxis Berhad• Reasons: 1. leading communications service providers in Malaysia that

enabling both individuals and businesses to connect and communicate anytime and anywhere

2. listed company in the Bursa Malaysia (easier to gather and obtain the information)

3. own risk department • project objective: to understand the risk management

process that applied by Maxis Berhad.

Company Background

• MAXIS BHD are the leading communications service provider in Malaysia, enabling individuals, families and businesses to do more in an Always On world. As MAXIS BHD customers increasingly immerse themselves in an ever expanding universe of connected applications, Maxis are obsessed with providing an unmatched end-to-end internet experience bringing together advanced always on connectivity and always great tech care.

• 1999: Binariang Berhad and changed name to the Maxis Communications Berhad

• Founded in 1993• Headquartered in Kuala Lumpur, Malaysia• Communication products, applications and

services : prepaid data plans, call plans and SMS plans, postpaid data plans, call plans and SMS plans, devices, wireless broadband, fiber internet,international roaming, MMS, WAP (over both GSM and GPRS) and residential fixed line services.

• Broadband Internet services are available to more than 1.6 million

• Maxis Enterprise serves over 50,000 businesses nationwide

• Most popular service: prepaid brand Hotlink, (over 9.5 million customers in Malaysia.)

Vision and Values

“Admired for excellence”• Excellence in everything that we do from how

we deal with customers to the way we work; in the way we greet people at the reception, the way we recruit people, the way we serve our coffee, the way we do our network strategy, the way we manage our talent and the way we do our branding.

• 3 values Positive -express that they are committed, driven, and

change-oriented.Passionate -proud of their brand, obsessed about customers

and their experience, and are passionate about how they work.

Collaborative.-inclusive, team-oriented and supportive of each

other.

Mission and Objective

Mission:Today: Malaysia’s leading mobile communications service

providerTomorrow: The nation’s premier integrated

communications service providerObjective:• Connected to mainstream Information and

Communications Technology (ICT) development Enabling an empowering these "connected communities"

• Bring about socio-economic development for those communities in the various sectors such as agriculture, education, health, and business, amongst others

Risk Management Process

• The Board regards risk management as an integral part of the Group’s business operations and has oversight over this critical area through the Audit Committee. The Audit Committee, supported by the Internal Audit department, provides an independent assessment of the effectiveness of the Maxis Enterprise Risk Management (“ERM”) framework and reports to the Board on a yearly basis.

Establishing The Context

• Defines the scope for the risk management process and sets the criteria against which the risks will be assessed. The scope should be determined within the context of the firm's organizational objectives. Risks are uncertainties that affect the achievement of business objectives, so risks cannot fully be identified if these objectives and strategies are unclear

Risk Identification

• The identification of key risks to the firm is a critical step in effective risk management and needs to be comprehensive. If a potential risk is not identified at this stage it is omitted from further analysis, which means a material risk may be given insufficient attention. The risks that relate to the firm's context and business objectives must be identified, whether or not they are under the influence of the firm.

25 risks:• Failure to realize new roles in evolving industry

ecosystems• Lack of regulatory certainty on new market

structures• Ignoring new imperatives in privacy and security• Failure to improve organizational agility• Lack of data integrity to drive growth and efficiency• Lack of performance measurement to drive execution• Failure to understand what customers value• Inability to extract value from network assets• Poorly defined inorganic growth agenda• Failure to adopt new routes to innovation

• Failure to shift the business model from minutes to bytes• Disengagement from the changing customer mindset• Lack of confidence in return on investment• Insufficient information to turn demand into value• Lack of regulatory certainty on new market structures• Failure to capitalize on new types of connectivity• Poorly formulated M&A and partnership strategy• Failure to define new business metrics• Privacy, security and resilience• Lack of organizational flexibility• Evolving service cannibalization scenarios• A more pressing green agenda• Concentration of equipment vendors• Difficulties in managing debt and cash• Hackers and data explosion making for dangerous cocktail

Risk matrix• Descriptions of the level of impact and the

level of likelihood:

• Extreme, high and low with different definition to represent the seriousness of the risk to the Maxis Berhad:

Top 10 Significant Risks

1. Failure to realize new roles in evolving industry ecosystems

2. Lack of regulatory certainty on new market structures3. Ignoring new imperatives in privacy and security4. Failure to improve organizational agility5. Lack of data integrity to drive growth and efficiency6. Lack of performance measurement to drive execution7. Failure to understand what customers value8. Inability to extract value from network assets9. Poorly defined inorganic growth agenda10. Failure to adopt new routes to innovation

Impact Of Risks On Organization’s Objectives, Mission And Vision

OBJECTIVE• Failure to realize the new role of them in evolving

the industry ecosystem• Unable share the information with the customer.• Not connected with each other because they not

bring a same common value within their selves.• Objective of Maxis Berhad is difficult to attain since

they fail to understand the customer value. • Demand on product, productivity and company

profit

MISSION• Failure to improve the organizational agility

(capability to be consistency adaptable without having to change. )

• Great stress or worry within the organization and affect the performance of the business

• Unable to adjust or attain its mission, strategies and goals where it is heading to respond to new threats, opportunities, or business conditions

• Affect on decision making process • Individual and team-level efforts ultimately

fail.

VISSION

• Lack of data integrity • Inaccurate inventory data demands • Data error • Company reputation• Customer will lose of confident • Lose customer• Profit declined

Risk Appetite And Criteria

Level of risk that an organization is willing to take on in pursuit of value before action is deemed necessary to reduce it

• Risk management framework: defines the authority and accountability in implementing the risk management process and internal control system

• Project task force: assessing and evaluating the feasibility and risk impact that prospective investments

• Management of each business unit: identify and document all possible risks that can affect their achievement taking into consideration the effectiveness of controls that are capable of mitigating such risks.

• Significant risks of business units are summarized into risk maps and presented annually to the Audit Committee for their consideration.

The following are risk maps of the company:

Risk treatment1. Failure to realize new roles– transfer the risk by form a contract with those application

providers

2. Lack of regulatory certainty– Communications and Multimedia (Amendment) Act 2004,

accept the risk

3. Privacy and security– transfer the risk to their business partners• cloud provider

4. Organizational agility– manage the risk, matrix structure

5. Data integrity – transfer the risk, build higher trust levels with third parties

6. Performance measurement– manage the risk, new internal metrics and new external

metrics

7. Customers value– manage risk, balance simplicity and flexibility of tariff

options

8. Extract value from network assets– manage the risk, integrating Wi-Fi with mobile networks

9. Inorganic growth agenda– transfer the risk, regular reviews of partners’ aims and

ambitions

10. Innovation– attract and sustain new types of talent, manage the risk

Communication And Consultation

• Ensure:– responsible for implementing risk management– those with a vested interest– understand the basis on which decisions are made – the reasons why particular treatment are selected

• Methods of communication and consultation– Meetings, distribution of minutes, reports, on-line

communication systems and learning packages, staff training

Monitoring And Review

• Ensure processes are in place to review and report on risks regularly

• There are several processes:– Continuous monitoring– Management review– Internal audit– External audit

Conclusion

• Risk management is important • Risk is unavoidable, the company should take an

appropriate and proactive action to handle all of the risks that might be happen currently or even in future and able minimize the possibilities of risks that might occur in the future which will affect the company performance.

• It helps us understand better about risk management process, thus we believe that it will definitely help us in our working life in the near future.