The proper risk analysis method is to use a step by step process to examine your operation and your exposure to the seen and unseen. The following fore step process is an excellent way to gain peace of mind and reduce risk in your business.
To name the risk is to recognize that it may be harmful to your business. Recognizing it as potentially harmful means you can reduce or mitigate the possible consequences. Reducing possible negative consequences means you sleep better and feel more in control of your destiny. Naming the different risks is the first step to peace of mind.
Once the risks are named then you must classify each of them. It is not enough to give each risk a name. Analyzing the severity of the risk helps you prioritize. Remember that there are certain things you an control and some you cannot. Exercise wisdom and do what you can about those things you can control. Focus there first.
Once you have the risks named and prioritized then you are empowered to take measures to minimize consequences. You have many options to minimize possible bad events to your business. Insurance and outsourcing are two of the most popular. Check out this post for more information on types of insurance and risk mitigation tools.
No strategic plan to reduce risk is complete without evaluating the results. Remember to always start with the end goal in mind. What risks, if any, have disappeared thanks to your brilliant new plan? What new threats arise since you implemented the perfect new strategy? Evaluate your strategy often. Be sure to adjust your insurance policies and strategies as the threats evolve.
More excellent posts on Risk Management:
- Name the risk.
- Classify the severity of each risk.
- Empower employees and minimize risk impact.
The Breviary: Business risks are part of the entrepreneurial success. A great strategy risk management strategy empowers you to take control and gain peace of mind over threats to your dream. Stay vigilant, stay focused, stay in control.
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Protecting your dream is fundamental to sustainable success for any entrepreneur. Every small business faces risks. It is almost guaranteed that your dreams is at risk in ways you never imagined.
Risk management is the concept and process of protecting and preserving your accomplishments.
- Huffington Post