What keeps you awake at night?? Most business owners have concerns that keep them awake. For me, it is ensuring that I have done everything possible to make my clients successful and of course closing that next big sales opportunity. In my industry, I form partnerships that last for years so I must ensure the success of my clients.
Whether it be business continuity or simply the relationships owned by an entrepreneur, there is always risk associated with running or owning a business. But never fear, there are ways to mitigate risk in a business.
Here are 5 simple ways to help identify and proactively manage risks in your organization:
1) Identify risks before they become problems. Ask poignant questions about how you would recover or handle troubling things such as a disaster or a sexual harassment suit. Interview different employees in various departments to ensure that rules and business processes are properly defined, documented and followed.
2) Utilize experts to help identify problem areas. Let’s face it, we all have strengths AND weaknesses. Good business owners should know that while they may be good at managing a food service operation, accessing the viability of an IT disaster recovery plan may not be something they are comfortable planning. In that scenario, do your research and select someone who is an expert and can guide your business. Intelligence is not necessarily knowing the answer but knowing where to look.
3) Plan for the unknown. What plan do you have in place should your largest customer decide to quit working with you? Most business owners never focus on the potential pitfalls within their organization. That is a normal trait among business owners. They always focus on growth and are eternal optimists; however, there is value in periodically playing the what-if analysis game. Just brainstorming options can provide tremendous value.
4) Have a plan. In the case of a flood at your corporate facility, have a plan of action so that you know what must take place to bring your business back on-line. While you can’t plan business continuity for an alien invasion, you can plan for a flood, tornado, hurricane or something as terrible as a workplace shooting. How will you help your employees get back to work while ensuring their family safety and happiness?
5) Perform strategic planning. Take time with your leaders to sit down and analyze risks in the business. One of the most powerful tools is a simple SWOT analysis. What are the biggest weaknesses and threats to your business? Those items are risks to your business that must be addressed. Do you have a problem in billing your customer’s accurately due to a rapid expansion? What is the likelihood that those customers will leave you? Sitting down and talking through these various scenarios can provide untold value to an organization because it can provide fresh perspective to a problem.
You can never remove the risk from a business, but you can identify and proactively manage those risks. If you would like to learn more about risk management and some other tools to accelerate your business’s growth please join us on May 9th at Kraft CPAs in the Parthenon Room from 2-6pm for a special joint presentation with Melo Insurance and E3 Performance Group. Register for this event today and let us know if you have any questions: http://www.serviceindustryaccountingsoftware.com/aboutus/.
By Glenn Saunders, Director of Client Success at Kraft Enterprise Systems