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All World Airways Case

All World Airways Case. Group 4: Li Wei Denisa Teme Tolulope Oke Jalal Hafidi Mathew Joseph. Background & Issue. OVERVIEW. Finding Risks. Risk Assessment. Interactions with Vendors. Questions. Background & Issue. Background & Issue.

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All World Airways Case

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  1. All World Airways Case Group 4: Li Wei Denisa Teme Tolulope Oke Jalal Hafidi Mathew Joseph

  2. Background & Issue OVERVIEW • Finding Risks • Risk Assessment • Interactions with Vendors • Questions

  3. Background & Issue

  4. Background & Issue • All World Airways(AWA) International airline with reservations in Detroit, Michigan, US & Wiesbaden, Germany • Posted losses for the past six quarters • Industry - Economic downturn, petroleum prices, labor disputes and the competition • Competitors - self-supporting; entered into outsourcing agreements • Two data centers in both locations • Maintenance, scheduling, airfare sensitivity analysis and freight systems • Plans to outsource IT function

  5. Finding Risks 􀁳 􀀦􀁉􀁎􀁁􀁎􀁃􀁉􀁁􀁌 􀁒􀁉􀁓􀁋􀁓 􀁳 􀀨􀁕􀁍􀁁􀁎 􀁒􀁅􀁓􀁏􀁕􀁒􀁃􀁅􀁓 􀁒􀁉􀁓􀁋􀁓 􀁳 􀀣􀁏􀁍􀁐􀁅􀁔􀁉􀁔􀁉􀁖􀁅 􀁒􀁉􀁓􀁋􀁓 􀁳 􀀲􀁅􀁐􀁕􀁔􀁁􀁔􀁉􀁏􀁎􀁁􀁌 􀁒􀁉􀁓􀁋􀁓

  6. Finding Risks Compile a list of risks for each of these five areas:

  7. Reputational Risks • Laying off programmers & operations staff might lead to poor company image • Risk of reputational loss due to non-compliance with SOX, PCIDSS and other standards • Risk of programming transfer not meeting organizational standards

  8. Human Resources & Competitive Risks Human Resources Risks: • Litigation risk due to European work lead rules • Sabotage risk Competitive Risk: • Internally developed solutions

  9. Financial Risks • Liquidity risk • Risk of financial loss in the event of outsourced company going bankrupt • Risk of unforeseen high cost • Regulatory risk – cost of non-compliance

  10. IT Risks • Risk that organization specific modules of the internally developed application might be lost in the event of outsourcing • Risk of inadequate IT specialist to manage the application once outsourced • Risk of non-compliance with required standards such as US SOX act of 2002, PCIDSS • Risk of revenue loss as the current equipment and data centers are leased • Risk of the risk assessment not meeting business needs due to inexperienced risk assessment specialist

  11. Risk Assessment

  12. Risk Assessment • Using COBIT PO9, how would you perform a risk assessment of the risks identified in question 1 to provide an objective and subjective assessment for management’s consideration?

  13. Risk Assessment

  14. Risk Assessment

  15. Risk Assessment

  16. Interactions with Vendors • Using COBIT DS1 and DS2, identify what role the retained organization should have in its interactions with the vendor for the outsourced IT function.

  17. Interactions with Vendors

  18. Questions? Thank you

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