Identifying risks within your business
You cannot start a business without taking risks. Choosing to launch your business is inherently a risk, there is no guarantee of success. But you shouldn’t do so without the mindset of being able to overcome any of these risks. To help with this, identify them in advance and have a plan set in place to fight them at manageable levels. Of course, you cannot predict every possible problem that can materialise, but the more you try to anticipate them, the easier plans to deflect them can be Risks can come in a variety of forms:
These are the more difficult to predict, but the probability of them occurring is lower than others, for example floods, fires, or pandemics. But even with a low chance of happening, these are disastrous events with great impact. So great, that you need contingency plans to deal with them. You should identify these risks as part of your market / industry analysis, as these risks will generically affect your whole industry, so think of how your competitors might react to gain an advantage over you in recovery.
The range of risks in this category is varied depending on how your business operates, for example, loss of supply, malfunctions with machinery, product contamination etc. Use scenario planning to find these risks when identifying your key activities. Based on the threats your organisation faces, you can explore scenarios about the results before they materialize, and find a possibility that makes life easier to move on from it. Possible Risks:
Pre-launch delays – Are any of the pre-launch key activities likely to cause delays?
Competitors – What are they Doing?
Competitive advantage – Is it being eroded?
Market – How is it changing?
Customer value proposition – Is it being delivered?
Product / service quality – Is it adequate?
Customer service – Are they satisfied?
Cash flow – Is it adequate?
Sales – Are you meeting targets?
Profits – Are you meeting targets?
Operations – Are key activities under control?
Productivity – Is it meeting targets?
Administration – Are processes and procedures working well?
Brand identity – Is it being established?
IP – Is it secure?
Technology – How are changes affecting you?
Investment – Do you need more? Why?
Stocks / inventory – Are they adequate or too much?
Merchandising – Is it under control?
Debtors / receivable – Are they under control?
Interest rates – How will changes affect you?
Exchange rates – How will changes affect you?