Lesson Plan
Course Title – Marketing Dynamics Unit 1, Lesson 5
Session Title – Handling Business Risk
Performance Objective:
After completing this lesson, students will be able to interpret how various types of risks
impact business activities evaluate security precautions and demonstrate knowledge of
safety precautions and skills related to health and safety in the workplace.
Approximate Time:
When taught as written, this lesson should take two to three days to complete.
Specific Objectives:
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
Students will be able to interpret how various types of risks impact business
activities.
Students will be able to evaluate security precautions and demonstrate
knowledge of safety precautions and skills related to health and safety in the
workplace.
Terms:










Risk Prevention and Control
Risk Transfer
Risk Retention
Risk Avoidance
Insurance Policy
Extended Coverage
Property Insurance
Business Liability
Personal Liability
Product Liability
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Preparation
TEKS Correlations:
This lesson, as published, correlates to the following TEKS. Any changes/alterations to
the activities may result in the elimination of any or all of the TEKS listed.
130.347 (c)(27)(B)
…interpret how various types of risks impact business activities…
130.347 (c)(28)(A)
…evaluate security precautions and
130.347 (c)(28)(B)
…demonstrate knowledge of safety precautions and skills related to health and safety in
the workplace.
Interdisciplinary Correlations:
English:
110.31 (b)(21)(B)
… organize information gathered from multiple sources to create a variety of graphics
and forms (e.g., notes, learning logs)…
110.31 (b)(22)(B)
…evaluate the relevance of information to the topic and determine the reliability, validity,
and accuracy of sources (including Internet sources) by examining their authority and
objectivity…
110.31 (b)(23)(C)
… use graphics and illustrations to help explain concepts where appropriate…
110.31 (b)(23)(D)
… use a variety of evaluative tools (e.g., self-made rubrics, peer reviews, teacher and
expert evaluations) to examine the quality of the research…
Occupational Correlation (O*Net - http://www.onetonline.org/)
Risk Management Specialists 13-2099.02 Similar Job Titles: Risk Management Director, Chief Risk Officer, Risk Manager, Credit
Risk Management Director
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Tasks:

Document and ensure communication of key risks.

Maintain input or data quality of risk management systems.

Recommend ways to control or reduce risk.

Identify key risks and mitigating factors of potential investments, such as asset
types and values, legal and ownership structures, professional reputations,
customer bases, or industry segments.

Devise systems and processes to monitor validity of risk modeling outputs.

Gather risk-related data from internal or external resources.

Identify and analyze areas of potential risk to the assets, earning capacity, or
success of organizations.

Develop or implement risk-assessment models or methodologies.

Produce reports or presentations that outline findings, explain risk positions, or
recommend changes.

Plan and contribute to development of,risk management systems.
Soft Skills:
Active Listening, Reading Comprehension, Critical Thinking, Speaking, Coordinating,
Active Learning.
Teacher Preparation:
Teacher will review the terms in the outline, digital presentation slides, and handouts to
become familiar with lesson.
Teacher should locate and evaluate various resources and websites before the lesson.
Teacher will have assignments and website information ready to distribute to students.
References:
Marketing Essentials, Schneider Farese, Kimbrell, Woloszyk, Glencoe McGraw-Hill
Instructional Aids:
1. Display for digital presentation, websites for assignments, and class discussion
2. Marketing Essentials, Schneider Farese, Kimbrell, Woloszyk, Glencoe McGrawHill
3. FEMA website http://www.ready.gov/risk-assessment
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Materials Needed:
1. Printer paper
2. Assignments and website information ready to distribute to students.
Risk Management Recommendations Direction Sheet
2. Computers with digital presentation software.
3. Internet for students to research business risks.
Equipment Needed:
1. Computer with digital presentation and Internet access
2. Projector to show Internet sites
3. Computers for students to conduct Research
Learner Preparation:
There are many risks which business owners must be aware of in order to avoid them
and be profitable. But just being aware of your risks is not enough; the smart business
owner also takes steps to mitigate their risks so if something bad does happen, they will
not be out of business. This can be done is multiple ways, like purchasing insurance or
making sure that their employees are well trained. This unit will discuss multiple ways
that business owners can avoid or reduce their potential for losses due to risk.
Introduction
Introduction (LSI Quadrant I):
SHOW: Show students the FEMA website that deals with businesses risk assessment.
http://www.ready.gov/risk-assessment
SAY: Explain to students that all businesses big and small must assess their risks
regularly and put in place plans to reduce their vulnerability.
ASK: Ask the students if they can name risks that business might need to be aware of.
SAY: Explain that there are more than just natural disasters and external risks, some
risks come from within the business.
ASK: Ask students what they think is the most important thing that a business can do to
reduce their risk.
SAY: Explain that there are multiple things that business can do, purchasing insurance
in case of disaster or just making sure that their business is well maintained and clean
can reduce risk.
ASK: Ask students if they think purchasing insurance will take care of all risks
associated with their business.
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SAY: Explain to students that insurance will not cover all of the risks involved. Business
owners must be aware of their markets also and make wise decisions to lower their risk.
Outline
Outline (LSI Quadrant II):
Instructors can use the digital presentation, slides, handouts, and note pages in
conjunction with the following outline.
MI
Outline
I. Handling Risk – There are four basic ways
that businesses can handle risk.
A. Risk prevention
B. Risk control
C. Risk transfer
D. Risk avoidance
II. Risk Prevention
A. Risk prevention involves taking steps
to prevent and control risks by
1. Screening and training
employees
a) Hire only competent
employees
b) Drug screen employees
c) Provide proper training
for employees
2. Providing safe conditions and
safety instructions.
Copyright © Texas Education Agency (TEA)
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Notes to Instructor
Use digital
presentation and
current events as aid.
While businesses
cannot avoid risk
there are some
things that they can
do to handle the risk.
They can take steps
to prevent the risk
from happening in
the first place, then
can also control the
risk by making sure
that employees are
properly trained and
screened, they can
transfer to risk to
third parties for a
price, and they can
take steps to avoid
the risk altogether.
Use digital
presentation as an
aid.
Risk prevention can
be accomplished in
several ways.
Ensuring that you are
hiring the best quality
employees by
background and drug
a)
Arrange office to
prevent accidents
b) Develop accident
management programs
3. Preventing external theft
a) Install closed-circuit
security cameras
b) Hire security personnel
c) Use two-way mirrors.
d) Lock up expensive
items
e) Use product placement
to place easily stolen
items closer to cashiers.
4. Deterring employee theft
a) Install computerized
POS systems and
analyze for
discrepancies.
b) Prosecute dishonest
employees.
III. Risk transfer can be accomplished by
transferring risk to a third party.
A. Purchase insurance
1. Property insurance
2. Replacement cost coverage
3. Automatic increase protection
4. Loss of income
5. Business liability insurance
6. Personal liability insurance
7. Product liability.
8. Life insurance
9. Credit insurance
10. Workers compensation
insurance
B. Product and service warranties
C. Changing business ownership
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screening will help
avoid employee
misconduct.
Accidents by both
employees and
customers can be
curtailed if the
office/warehouse/stor
e is setup properly
with sturdy shelving
and obstacles put
away. Using a safety
committee to review
possible safety
concerns is also
recommended.
Theft prevention from
both employees and
customers can be
minimized by using
security cameras,
hiring security
personnel, and
prosecuting
offenders, and will
send a message.
Use digital
presentation as an
aid.
Transferring risk to
third parties such as
insurance companies
is a smart way for
businesses to reduce
their possible losses.
There are numerous
types of insurance
that can be
purchased. The most
common is property
insurance which
protects the business
from loss due to fire,
theft, or natural
disasters.
Businesses can also
purchase insurance
loss of income
insurance that will
pay them for missed
income while their
businesses are being
repaired. Other types
include, business and
personal liability
insurance to protect if
they are sued, credit
insurance which will
pay if a customer
who they have
extended credit to
does not pay, and
product liability
insurance which pays
for losses in the
event a product that
they manufacture or
sell is defective.
IV. Risk retention involves instances where the
business must assume responsibility for the
risk.
A. A business can’t sell inventory that is
no longer in style or a fad.
B. Bad weather prevents customers
from shopping or eating out during a
special event.
C. Opening a new business that does
not attract customers.
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Use digital
presentation as an
aid.
Some risks must be
absorbed by the
business owners
themselves. If a
business made a
poor decision and
ordered too much of
a particular item, they
may have to sell the
excess at clearance.
Or if a weather event
disrupts a special
event that they had
purchased additional
inventory for, they
may have to take a
loss since they
cannot make up the
sales. Or if a
business is opened
up in the wrong
location or offers
products that are not
wanted. Insurance
will not cover these
types of losses so it
is important that the
business owner
make sound
business decisions at
all times.
V. Risk Avoidance involves taking steps to
anticipate possible pitfalls and avoiding them.
A.
Market research can help businesses
determine what their customers want
and produce a product that will be
well accepted.
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Use digital
presentation as an
aid.
Marketing research
and market planning
are essential to a
successful business.
By following the
marketing concept,
businesses will
deliver products to
customers that they
want and need and
minimize a
business’s risk when
introducing new
products, product
planning, and
purchasing.
Verbal
Lingui
stic
Logical
Visua
Mathemat l
ical
Spati
al
Music
al
Rhyth
mic
Bodily
Kinest
hetic
Intraperso
nal
Interperso
nal
Natura Existenti
list
alist
Application
Guided Practice (LSI Quadrant III):
Ask students to brainstorm the risks a small convenience store that is open 24 hours
and located in Texas might face. (Write the answers on the board, these should include
such things as robbery, tornados, floods, employee theft, shoplifting, customer falls,
etc.).
Ask the students to list the risk management technique they would recommend that the
convenience store owner use to mitigate their exposure for each risk listed.
Independent Practice (LSI Quadrant III):
Business Risk Recommendations (Team project: two students per team)
Each team is to assume that they are the risk managers for a large retail clothing store
chain with stores located throughout the United States. The stores sell upscale trendy
clothing for customers who are very fashion conscious. Most of their stores are located
in large shopping malls but some are in free standing buildings. They have been asked
by upper management to evaluate the risks that the clothing stores might face and risks
that the corporate office also needs to be aware of.
Once the risks are identified, students are to use one the four risk management options
to provide recommendations of how those risk should be managed. They will need to
give a brief description as to how that will help the business reduce their risk. They will
create a digital presentation that they will present to the class.
This project will be evaluated using the assigned rubric.
Summary
Review (LSI Quadrants I and IV):
Question: How can risk be transferred?
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Question: Can all risk be prevented?
Question: How might a business owner keep from producing products that the
customers do not want or need?
Question: How might a business owner prevent accidents from happening at work?
Question: What can a business owner do to protect themselves from lawsuits?
Question: What are some advantages of having property insurance?
Question: How might a business owner prevent employees from stealing from the
business?
Question: What role does marketing play in risk management?
Question: Why is it important to manage risk?
Question: Can all types of businesses use risk management?
Question: What type of insurance can be purchased to pay while business repairs are
being made after a disaster?
Evaluation
Informal Assessment (LSI Quadrant III):
Instructor should observe the work ethic of individuals involved in class discussions and
the Independent Practice activity.
Formal Assessment (LSI Quadrant III, IV):
Students will be evaluated on their Business Risk Recommendations by using the
assigned rubric.
Extension
Extension/Enrichment (LSI Quadrant IV):
Business Preparedness Essay
Using the FEMA website for business planning, write an essay that details what steps
FEMA suggests should be involved in a business preparedness plan, how it would be
implemented, how it is tested, and how it can be improved. The essay should provide
statistics and specific steps that a business can take to ensure that they are prepared
for a natural or terroristic disaster.
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Marketing Dynamics
Unit 1 Lesson 5
Student Directions
Independent Practice (LSI Quadrant III):
Business Risk Recommendations (team project: two students per team)
Each team is to assume that you are the risk managers for a large retail clothing store
chain with stores located throughout the United States. The stores sell upscale trendy
clothing for customers who are very fashion conscious. Most of their stores are located
in large shopping malls but some are in free standing buildings. You have been asked
by upper management to evaluate the risks that the clothing stores might face and risks
that the corporate office also needs to be aware of.
Once the risks are identified, you are to use one the four risk management options to
provide recommendations of how those risk should be managed. You will need to give a
brief description as to how that will help the business reduce their risk. You will create a
digital presentation that you will present to the class.
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Independent Practice (LSI Quadrant III)
Business Risk Recommendation Digital presentation and Collateral Materials
Rubric
20
15
10
5
CATEGORY
Presentation
Well-rehearsed with
smooth delivery that
holds audience
attention.
Rehearsed with fairly
smooth delivery that
holds audience
attention most of the
time.
Delivery not smooth, Delivery not smooth
but able to maintain and audience
interest of the
attention often lost.
audience most of the
time.
Attractiveness
Makes excellent use
of font, color,
graphics, effects,
etc., to enhance the
presentation.
Makes good use of
font, color, graphics,
effects, etc., to
enhance the
presentation.
Makes use of font,
color, graphics,
effects, etc., but
occasionally these
distract from the
presentation
content.
Use of font, color,
graphics, effects,
etc., but these often
distract from the
presentation content.
Content
Covers topic indepth with details
and examples.
Subject knowledge
is excellent.
Includes essential
knowledge about the
topic. Subject
knowledge appears
to be good.
Includes essential
information about
the topic but there
are one to two
factual errors.
Content is minimal
OR there are several
factual errors.
Organization
Content is well
organized using
headings or bulleted
lists to group related
material.
Uses headings or
bulleted lists but the
overall organization
of topics appears
flawed.
Content is logically
organized for the
most part.
There was no clear
or logical
organizational
structure; just lots of
facts.
Originality
Product shows a
large amount of
original thought.
Ideas are creative
and inventive.
Product shows some
original thought.
Work shows new
ideas and insights.
Uses other people's
ideas (giving them
credit), but there is
little evidence of
original thinking.
Uses other people's
ideas, but does not
give them credit.
Total Points Earned _______
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