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Culture in Organizations

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Submitted By mnicholasgroves
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International School of Management

Identifying and Managing Risks in Professional Services Firms & The Novo Group Incorporated

Candidate: Maria Nicholas-Groves
Date: August 15, 2013

Executive Summary

Identifying, measuring and managing risks are critical for all businesses today. There is substantial research of applying risk management within manufacturing companies, yet limited information regarding services firms and their need to manage risk effectively. Nevertheless, service businesses account for 70% of employment and 70% of domestic product in Western countries (Hollman, 1991). Given the substantial impact this industry has on Western States, it is critical companies understand how to apply risk concepts and become capable of dealing with their risks appropriately and cost effectively. This paper will uncover the core risks professional services firms’ face. It will overlay this assessment on a micro level, reviewing The Novo Group, Incorporated. This is a professional services firm specializing in recruiting professional talent in the United States. In this intersection of risk, the paper will attempt to measure the risk, its impact, and options to manage these possibilities.

Professional Services in the United States of America

Services are a critical contributor to the United States’ gross domestic product and are responsible for the livelihood of thousands of professional’s. In fact, in 2011, the U.S. professional services industry comprised of nearly 760,000 firms with combined annual revenues of $1.3 trillion. The industry employed 7.8 million Americans. Management consulting firms alone contributed $152.6 billion in revenue (Department of Commerce, 2013). Services firms are fundamentally different than product-based firms. The

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