Outside of workplace health and safety, most small businesses and even some larger ones don’t routinely identify and work to reduce their risk. The result? They risk being blindsided by stuff they should have seen coming.
So, how can you get started without spending a heap of time you don’t have? A sensible approach would be:
- Identify your risks
- Rank them for likelihood of occurrence and impact
- Identify the things you can do to reduce a given risk
- Act on it!
To get you thinking, here are 4 risks you might have (these are by no means the only risks your business will face):
- Key input risk
What are the main things that you need to make your product or deliver your service? If supply dried up or the price of this input was substantially increased, what effect would that have on your business?
- Key supplier risk
Do you rely on one or two suppliers for most of your inputs? What would happen if they were no longer around? How else could you source your inputs?
- Key customer risk
Does a disproportionate amount of your income come from just a few customers? Can your business withstand the loss of one or more key customers? What should you do about that?
- Key person risk
Are you reliant on one or two key people in your business? What impact would it have on you if that person was no longer there? How can you plan to reduce your reliance on key people?
Of course, risk analysis can and does get a whole lot more sophisticated than that – see ISO 31000 or call in a consultant if you’re keen to do things at a higher level. But for now, if you’re doing nothing, it’s high-time you got started. And doing the analysis is the first step. See how you go and reach out for help if you need it.