Question $1(10$ Marks$)$

GRANADA Manufacturing, a mid$-$sized enterprise in the automotive industry, has historically relied on traditional risk

management practices, focusing primarily on insurable risks such as property damage and liability. Recently, the company

faced significant financial losses due to supply chain disruptions caused by geopolitical tensions, highlighting the limitations

of their current risk management approach. In addition, emerging risks like cybersecurity threats and volatile commodity

prices are not adequately addressed within their existing framework. Recognizing these challenges, the company$$s

management is considering transitioning to an Enterprise Risk Management $($ERM$)$ framework.

Required

Analyze the differences between traditional risk management and ERM, and recommend how GRANADA Manufacturing

could benefit from adopting ERM. Include a discussion of specific risks that ERM could address more effectively compared

to traditional methods. Use examples from the case to support your analysis.