MOOC High was developed by Walter Salazar, a high school dropout who had difficulty thriving in a traditional high school environment. Walter was brilliant, and did well in courses that interested and challenged him, but couldn’t bear to sit through teacher-centered lecture courses. Walter decided to start his own online school, and hoped to be the first student in the world to graduate from his own school.
MOOC High has been open for one year and has been very successful, with 400 students admitted so far. Walter is aiming for an ongoing student body of 2000 by 2018, and advertises heavily through social media. Walter knows there are other companies developing online high schools, but doesn’t consider them to be threats because they are “too corporate”.
Walter doesn’t have employees, but has contracted with a friend working at H&R Block to manage billing and cash receipts. He has commissioned the hacker group Anonymous to build out and maintain the technology, and has hired top students from his former high school to create and manage specific courses.
Walter uses instructor reports to manage his school. For each course offered, the instructor tracks and reports: costs, student enrollment and completion rates, student participation in online discussions, student success on assignments and exams, and, student satisfaction. The teacher’s pay and decisions about offering the course in the future are based on these reports.
Because Walter’s time is spent contracting and managing the work, he hasn’t had much time to think about strategy or risk management. He doesn’t believe there are any significant risks at this point, but he has asked you to play the role of internal auditor and evaluate his risk management system. You have decided to use the ERM framework as a template.
Discuss strengths, weaknesses, and/or recommendations relating to each element in MOOC’s ERM framework:
1. internal environment,
2. objective setting,
3. event identification,
4. risk analysis,
5. risk response,
6. control activities,
7. information and communication,
8. monitoring