Inject a little risk
Risk management isn’t the most exciting part of running a business, but it’s crucial to realise just how important it is to get the balance of risk right.
Too little risk and you can run a significant risk in itself – that your business does not grow or develop its full potential.
Too much of it and you run the risk of losing everything, or at least, more than you’d like!
So think about getting the balance right. A good place to start is the strategic plan. Your appetite for risk can be sharpened by focusing on the objectives in the plan. Playing a “what if” scenario will help crystallise the impact of each risk and assess the level of comfort you and your senior managers have for risks involved in delivering the plan.
It might be worth running scenario games in management meetings involving some of the categories mentioned below. The exercise may also help you judge whether your strategic plan really is bold enough to deliver what the organisation needs to thrive and prosper.
Have a go at the following areas:
- Profit and loss, cash flow
- New products/services
- Acquisitions, mergers or collaboration
- Environmental impact
- Governance and compliance
- Human resources
- Reputation and brand recognition
A little risk is a good thing, so try it out and enjoy the process.
With thanks to Valerie Austin.
If you’d like to discuss any of the issues raised in this blog post, then give us a call on 01865 881056 or email us at firstname.lastname@example.org .