7 Ways to Minimize Small Business Risks
by Hillary Monroe / ORPICAL GROUP
Calculated risks are a bold, but crucial part of growing as a person and a business. They can be scary at first, as it can be human nature to overestimate the possibility of failure, but by evaluating the risk level for each opportunity that presents itself, you are more equipped to weigh the pros and cons of each situation.
A calculated risk is the key to good decision making, especially in a small business or organization that has big plans to grow. Overall, it is a chance of exposure to gain or loss for your business that might be undertaken after the advantages and disadvantages are carefully considered.
If you have been playing it safe with your business, it might be time to take a risk that will change how you look at decision making. Here are 8 ways to minimize the risk for your company:
1. Analyze Which Risks Make Sense for You
Risks are different levels of extremes for everyone, depending on their comfort level with change. For your business, you may want to become more efficient with your processes. For another, the concentration might be on growing their customer base. These two businesses would need completely different and specialized plans for what they wanted to achieve.
2. Set Your Goals and Brainstorm
By knowing your goal and working backwards to see how much time it will take to make the change, you prepare yourself for the process of the change. This step in the process also makes you aware of how many people will need to be involved and when.
3. Evaluate the Risk Level of Each Opportunity
When researching and preparing for the possibility of taking a risk, it is important to be unbiased to judge – such as an accountant, insurance agent, or marketing insight – to tell you when it will not be a good opportunity for the growth of the business. By getting an outsiders insight on your business, you get a more solid foundation of where your business is and where it could end up.
4. Create a Detailed Plan of Execution
With a calculated risk, you have to figure out what your goals are and fill in a roadmap of what will need to be done to make it happen. For example, coming up with a training program to roll out new procedures in your business works best when there is a set plan of exactly what each employee will learn and when.
By thoroughly researching the change you are planning to make, you know the consequences and benefits of what you are about to do. Stepping out of your comfort zone and taking on new opportunities presents your business as a leader in the market, and a carefully calculated plan can open you up to a world of possibilities that you hadn’t even considered in the past.
5. Edit and Change the Process As You Go
If you get halfway through a process and realize it is not going as planned, don’t be afraid to change it! Every business is different, and plans sometimes need to be tweaked to best fit what will work for your specific goal.
6. Review the Results
Whatever the outcome of your plan, use the results to help you adjust future decisions. Maybe you needed more funding or more time to complete the goal – now you are more aware of what to expect in your next endeavor.
7. Don’t Be Afraid to Fail
Not all risks go as planned, but it is crucial that you learn from your mistakes. Here at ORPICAL we want to teach you how to make positive, calculated risks that will increase your profitability, open up new opportunities, and start a new way of thinking. While there is always a chance of failing, we feel as though risks can be very beneficial to everyone involved when they are well thought out and executed properly. Risk is unavoidable, so controlling it with an informed decision is the best approach you can take for your business.
