Risk management covers a wide range of activities, from protecting your company against the threat of fire or flooding, to managing the risks associated with doing business with certain customers.
The primary goal of risk management system at WHS Monitor is to protect your assets and business. It’s essential for industries that have to deal with highly sensitive information and valuable products, such as financial institutions and pharmaceutical companies. Most businesses don’t own assets as expensive as banks or drug manufacturers, but every company has something it needs to protect. Even a small business has physical assets and intellectual property that need to be protected from theft or damage.
Don’t ignore the basics
Basic risk management practices include having fire extinguishers, smoke detectors and other safety equipment properly installed at your business. Having contingency plans in place for when things go wrong also is a must for any business owner. And, of course, having an emergency contact list is essential and should be updated regularly.
Use technology wisely
Technology can be an asset in managing risk, but it also can cause problems if used improperly. For example, using social media sites like Facebook or Twitter to post information about your company can increase the possibility of being hacked by cyber criminals who want to steal customer data or use your network to spread malware. Make sure all of the software you have on your computer and mobile devices are up-to-date so that you have no holes in your security system.
Implementing a risk management system starts with identifying what could potentially go wrong. This step includes looking at how your business interacts with its surrounding environment — people, processes and technology. Identify threats that could come from both inside (employees) and outside (customers, suppliers) your organization.
Your list should include all elements that could negatively affect your business, including people, hardware, software, policies, procedures and physical surroundings such as buildings or production sites. Also include items such as employees’ mobile devices and off-site data storage facilities.
Start with the basics
Get insurance coverage for your business as soon as possible. This includes health insurance, workers’ compensation, car insurance and liability insurance — all of which protects you from various types of risks and expenses that could otherwise put a big dent in your finances.
Set aside emergency funds
You never know when something might come up that will cost you thousands of dollars in unexpected medical bills or property damage repair costs. Having money set aside allows you to handle these situations without having to worry about going into debt or putting your business at risk of closure due to insufficient funds.
Inventory your assets
Start by taking stock of everything you own and keeping a record of what your assets are worth. Remember that your assets include not only physical items, but also things like cash and investments. Make sure to evaluate the value of any old items that are still in use, as well as any vehicles, valuable art or jewelry, etc. It’s also important to include intangible items like future earnings, retirement benefits and insurance policies.