Managing the risks of organizational accidents by James T. Reason Essay

Managing the risks of organizational accidents by James T. Reason - Essay Example As the above diagrams elucidate there are layers of defenses placed at every step of operation. When a latent error happens due to at one stage the next operating layer has defenses so that the mistake is not passed on in the chain of procedures. Only when all the layers of operation fall in line to allow for the lapse to carry on does the entire system come crashing down. The first chapter on "Hazards, Defenses and Losses" brings to light the type of errors (human or organizational) that may occur, the precautions or defenses a person or an organization may take in order to prevent them. Also talked of are the tangible and intangible losses that have to be borne. "The Human Contribution" is a chapter devoted to the prospect of human error. Though the book in its entirety does not hold individuals responsible for a systemic failure, the many times human errors led to large scale mishaps are explored here. Important examples include the Apollo 13 slip-up, Glenborough disaster, Three Mile Island nuclear reactor accident etc. "Maintenance cans Seriously Damage your System" is a misnomer as the author presents sets of bad maintenance leading towards the damage of the entire structure. It is a continuation from the previous chapter of the human factor responsible for great errors. "Navigating the Safety Space" is a chapter wherein the author forays into the amount of leeway allowable to a system before it crashes. The next four chapters are useful instruction guides to policy makers; design engineers etc. to make for defect minimizing systems. In "A Practical Guide to Error Management" the author writes on the hands down approach to managing errors. The chapter "The Regulator's Unhappy Lot" explains the measures and methods of restructuring an organization to steer clear of catastrophes. Chapter 9, "Engineering a Safety Culture" suggests a whole lot of relevant arguments for creating a safety culture within an establishment. "Reconciling the Different Approaches to Safety Management", the final chapter calls upon managers, engineers and the maintenance people to adapt to appropriate safety techniques in order to avoid the risks of ending up with a disaster financially, materially or otherwise. Critique: The book is a compulsory read for all personnel working in risky atmosphere, hazardous industries etc. The author has used all his expertise in dealing with the issue of accident negation or at least reduction. Strengths: The strength of the book lies in its simplicity. The easy to understand language and lucid style make it a universal reference guide for managers and workers alike. Weaknesses: Apparently there appear no

Business Financing and the Capital Structure Assignment

Business Financing and the Capital Structure - Assignment Example The total cost of each resource has to be determined and summarized. On the basis of the summarized reports of cost of resources, a budget will be prepared by the finance and accounts department which would help the organization to determine next course of action (Summers, 2011, pp.2-11). Working Capital Management Proper working capital management is necessary to carry out day to day business operations. It is defined as the difference between current assets and liabilities. Thus, the objective of working capital management is to maintain a balance between current assets and liabilities. Positive difference or surplus funds can be used to make planned expenses such as payment of short term obligations and salaries. The working capital is negative or deficit when the current liabilities exceed current assets that would require the firms to borrow short term funds in order to manage the deficit (Ganesan, 2007, pp.1-2). When the working capital is positive, the firm would have surplus short term funds which can be invested in the money market instruments. The maturity of money market instruments are less than one year and hence investment in money market is less risky. This is because, the status of any business can be more or less accurately predicted in short term whereas the same becomes uncertain as the maturity increases due to increased chances of borrower to default. Some important money market financial instruments are discussed as follows: Commercial papers (CP) – They are issues by highly rated corporate entities and classified as short term unsecured promissory notes issued at discount and redeemed at face value. Certificate of Deposit (CD) – It is similar to ordinary time deposit differing only in maturity period and interest rates. They are issued by banks and the interest rates are generally higher than savings deposit rates. Municipal notes – Short term financial security issued by municipality in expectation of tax receipts as revenues. Treasury bills – They are debt instruments issued by the government whose maturity ranges from 3 to 12 months. Repurchase agreements – they are short term loans that are arranged by an investor to whom securities would be sold with an agreement to repurchase them back on a future date at pre-determined fixed rate. Thus, a corporate organization may park their excess generated from efficient working capital management in above discussed financial instruments that are liquid and used as marketable securities. Financial Instruments of Securities Market Every organization invests capital in business to finance its operations and generates goods and services to meet demands and earn profit. As the business expands its operations more funds are required to carry out business objectives. The financial sources may be broadly classified into equity and debt. Funds can be raised from these sources in the financial securities market. The securities market may be furthe r divided into primary or secondary securities market. In the primary securities market only those securities are issued that are participating in securities market for first time and the process is known as IPO (Initial Public offering). The secondary market is a place for traders who buy or sell differ securities.