Know Your Risks: 3 of the Greatest Risks Your Company Could Face

For many of us, “risk averse” didn’t come into the conversation until COVID struck in 2020. Then, every outing and decision felt like a weight question of if it’s worth the risk. This weighing of factors is called a risk assessment, and it’s something your business should be doing every day — and not just in the context of COVID.

A risk assessment is a relatively simple thing with a wide array of potential complexity. You could conduct the risk assessment yourself by using any number of free and customizable tools or templates, you could hire a risk assessment team, or you could hire an emergency preparedness manager to conduct a risk assessment of your business. Regardless as to what your approach is, a risk assessment is not something any company should take lightly.

There are many different kinds of risks out there that a business should be aware of, including loss prevention, IT hazards and natural disasters. The reality is that when it comes to risk, you have to determine for yourself what risks your business is willing to take.

IT Hazards

This is one of the biggest risks out there for any company or business right now. There are many sophisticated malicious users out there who are looking for any and all holes in your IT security system. Some risks include general cyberattacks, malware, and ransomware. Often times, just a little bit of time and effort in building a secure IT network can save lost time, productivity, and reputation. All IT departments should look into having a robust next gen firewall and zero trust security architecture

Loss Prevention

This one may feel a little obvious for a business owner, but you have to determine what level of risk in lost revenue is acceptable. Some larger corporations don’t bat an eye at $50 walking out the door whereas for a smaller company, $50 may be a significant percentage of the day’s sales. Obviously, no loss is ideal, but unfortunately, there are dishonest people in the world and you have to determine what that risk is to your company and the best way to manage it. Here’s some ideas:

  • If you’re services based, require a credit card at the time of booking. Requiring a credit card at the time of booking and having a cancellation and no show policy (ie a 50% cancellation fee for less than 24 hours notice or charging the card on a no show) prevents you and your staff from having downtime without generating revenue.
  • Train your staff. No, don’t train them to follow customers around to make sure they don’t steal. Research ways to appropriately train your staff to be aware of potential loss. Your staff are the ‘men and women on the ground,’ so to speak, who can protect you just by being aware of the people that your company interacts with.
  • Train your managers. Too often now, we are seeing posts on social media about how staff cheat the system to steal from within the company. Whether they are giving too many discounts or pocketing cash that isn’t theirs — or outright stealing merchandise — managers who are trained to see and discourage those risks are an essential tool.

Natural Disasters

In a world where pandemics dictate whether or not we cover our faces, natural disasters seem to be running rampant from earthquakes and underwater volcanoes to fires, snowstorms, and hurricanes, it can be difficult to predict what’s coming next. Look specifically at your area and determine what natural disasters you’re most likely to face. What is their potential impact on your business? After all, knowing your enemy is the first step!

Be Ready and Steady

You can’t be afraid of everything as you’re assessing your company’s potential risks. People, technology, and mother nature are all prone to be unpredictable. However, determining your highest risks, preparing for them and defending your company against them is a good start. Start by determining your most costly risks and then make a plan to defuse the situations before they even begin.

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