Do you know what are the top risks for your business?
Risks are potential problems that might stop you from achieving company goals, and if you haven’t identified and prepared for them, you could be in for a few struggles.
When running risk workshops for business leaders for the first time, I find there can be many risks identified, and this can be overwhelming. To decide where to focus, we work through the rating of the risk to identify the “big” ones that are either more likely to happen or will cause more of a problem if they do.
Risks can come from internal weaknesses or external threats, and there are several handy tools to prompt us to think about the source of these risks. This is where a good facilitator can deliver a significant benefit, guiding participants through the process.
So, what am I seeing as the top risks for business currently?
1. Information security, cyber security, and privacy
This probably has had the most publicity over the last year or two, and rightly so. All businesses — large, medium, or small — can be subject to privacy compliance failures or disruptions from cybercrime. Have you identified your vulnerabilities?
2. Supply chain
COVID woke many businesses up to the risks of a limited supply chain. Some choose to ignore the lessons and are lulled back into thinking it has all settled down again. Are you relying on one supplier? Are you vulnerable to fluctuations in the reliability or quality of your suppliers?
3. Loss of key people
Small business has always struggled with succession planning, and even in large business, it doesn’t always go to plan. The risk here is relying on individuals’ knowledge can leave a company vulnerable.
Think of the expert who everyone goes to solve a problem. What would happen if they “won lotto” and didn’t return one day?
There is a myriad of potential problems your business could face. Enterprise risk management, or business risk management for smaller enterprises, embeds routine consideration of these risks and makes sure you are ready if one of them eventuates.