Risk Management: A Study on the Assessment of Tolerable Level of Risk

after Transition to Digital Marketing among Various Businesses in

Olongapo City

Proponents:

Romulo Arcales Jr.

Jayson Geronimo
Katherine Joie Molina
Paulo Miguel Penilla
Jedeline Shay Radovan
Introduction

Businesses encounter risks or uncertainties in their everyday operations.

May it be small like whether they operate and hour late to huge ones like deciding

whether to continue pursuing an industry where they continually incur a loss. It is

common that businesses also fail in appropriately deciding their needed moves in

these circumstances leading to their downfall. Given that different businesses

encounter different problems in their operations, it is safe to say that this type of

study will get broader and broader as businesses expand (e-business for example)

which continually grows as we enter the internet age.

In order to properly conduct a study on business risk that the market find

acceptable, one must also tackle business kinds, their necessary elements, and

the risk itself and whether they have control over it (internal or external). The study

will also seek to answer whether a business that currently is raking profits will

continually do so with changes in the market.

Review of Related Literature

According to Investopedia, business risk is the possibility a company will

have lower than anticipated profits or experience a loss rather than taking a profit.

Business risk is influenced by numerous factors, including sales volume, per-unit

price, input costs, competition, and the overall economic climate and government

regulations. In order to prevent this, a business must assess everything prior to

making decisions that might affect their business in the long run. The strength,

weakness, opportunities, and threats (SWOT) analysis is a great starting point to

identify whether the move they are planning is beneficial.

According to Akshay Sharma, the strength of the business firm means

capacity of the firm to gain advantage over its competitors. Analysis of internal

business environment will help to identify the strength of the firm. After identifying

the strength, the firm must try to consolidate or maximize its strength by further

improving its existing plans. Weakness of the firm also plays a big role and no

business have no weakness, they call only minimize its vulnerability by planning

and being proactive. Weakness means limitations of the firm. Monitoring internal

environment helps to identify not only the strength but also the weakness of the

firm. A firm may be strong in certain areas but may be weak in some other areas.

For further growth and expansion, the weakness should be identified so as to

correct them as soon as possible. Environmental analyses help to identify the

opportunities in the market. The firm should make every possible effort to grab the

opportunities as and when they come and early identification of threats for its early

defusal. This is only in addition to necessary business knowledge that those who

manage firms must possess. After these they must have knowledge of the risks

that businesses may face along the way.

According to Paul Hudrick, surveying customers is so much more important

today that customers will try to practice their rights through the internet.

Understanding the needs of your best customers and those you want to do more

business with is an invaluable tool for driving results. The purpose of this exercise

is two-fold. First, it forces you to evaluate the composition of your customer base.

Second, surveying customers reveals salient insights into what customers want

(which drives business) and also determines how your company is perceived. In

my experience, many firms underplay the value of surveying customers, thinking

they have good relationships with customers and already understand what they

want. Nevertheless, I’ve seen firms receive unexpected results from customer

surveys. Some customers indicated that their providers did a good job but were

missing critical services that could strengthen relationships and drive revenue

opportunities.
Scope and Delimitation

This research study aims to know and assess the tolerable level of risk and

the effect in switching to Digital Marketing among businesses, and the comparison

on the profit earned by those businesses which uses a Traditional Marketing and

Digital Marketing.

The respondents of this study will be the various businesses in Olongapo

City. The researchers will only assess the marketing aspect of every respondents.

Significance of the Study

This study of the tolerable risks that businesses can take would really help

businesses to have more capacity to grow and in the near future be able to

compete with other entities in making economic decisions wisely.

Statement of the Problem

1. Does a specific business currently earning profit continually do so after we

transition to more web-based markets?

2. What are the different ways that businesses do to minimize losses in a

business currently at a loss in effect of the transition.