10 Tips To Reduce Business Risks

Carry out a thorough examination of what you depend on for your business plan to work well to realise your objectives, including systems, people, supplies and the dependencies of all the important elements you rely on. Don’t just assume critical things like customers paying promptly. Consider what could get in the way of success, or damage your business, both internal and external, within and beyond your control. Apply a thought through, granular approach, not a tick-box exercise.

Involve others including someone objective, not too close to the running of the business, to help you approach this from different angles and ensure all key risks are identified.

Build risk identification, assessment and management into all your planning including any new project or plan update.

Rate your risks, taking into account the potential impact on your business, what level of risk it can tolerate and the likelihood of the risk materialising. Consider the effect of the existing protective measures in place, using data, test checks and (independent) audit as necessary.

Prioritise and consider further action, using resources proportionately to reduce outstanding risk to a tolerable level if possible and to ensure appropriate reliable contingency arrangements including adequate insurance are in place. Obtain professional advice to help you do this where you do not have suitable in house knowledge and expertise.

Monitor risks and action to address them.

Include risks and the progress and effectiveness of this action in your normal reporting (frequency as appropriate)

Review and test your contingency plans regularly to ensure they are robust and ready and that all who need to know about them are adequately informed.

Keep risks and insurance under review.

Maintain a culture that supports the identification, reporting and control of risks.