To keep your business running efficiently, you must perfect your processes and tweak them. However, you should also know the risk factors involved in each process. What are some of the trouble areas you might encounter, and how will you mitigate them? This article gives you an insight into the perfect time to conduct a risk analysis. Read on!
Companies may be much more exposed than they think. In a study of 56 different companies, looking at data risks, researchers found 39% of companies have over 10,000 stale user accounts. These accounts are defunct but are still active, which opens companies up to hacking risks.
Data is just one of the many risks businesses face, though. Take control of your processes today, so you can reduce the chances of harm to your business.
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When Should Risk Analysis Be Done?
Knowing the right time to conduct risk analysis isn’t easy. It takes time to look at all your processes, and you’re likely busy building your brand. However, ignoring risks may run you up into a situation that makes you realize it’s too late to avoid catastrophe. Here are some tips for when to conduct risk analysis.
1. You Have New Competitors
Anytime new competitors arise, you need to look at risk factors associated with them. Take the time to map out the areas you serve and where they serve and make sure you aren’t missing any of your core audience.
Use sales territory mapping to lower the risk of the two salespeople serving the same customers rather than reaching new ones. Find areas you haven’t reached where you might grow your business in the next year. The more data you have, the better your sales team can perform.
2. Your Revenue Is Down
Dig into the reasons why your revenue is down. Reach out to your past customers who’ve gone elsewhere and ask them why. Take careful notes of any complaints.
Once you have a list of reasons people went with your competition, look at your processes and what you need to overhaul to improve the situation. For example, if former clients say they left because of shipping delays, you must change your logistics.
3. Technology Changes
New technology impacts different industries in various ways. If something new is changing the way businesses run, then it’s time to revamp your processes and embrace automation and artificial intelligence.
Did a new smartphone come out? How might the new features impact how you interact with customers? Are your clients adding smart speakers to their homes? How can you tweak your online presence to account for voice search?
4. New Hazards Emerge
Did you just take on a new job? There are likely new hazards to contend with. You must take a look at your safety processes and keep your employees safe. The last thing you want to do is see your workers get hurt.
Tips for Performing a Risk Analysis
If you feel it’s time for risk analysis for the reasons listed above or something else, it’s important to know how to perform one that gives you the information you need.
1. Identify the Risks
Figuring out what risks you must contend with is the first step to fixing things. The World Economic Forum releases an annual report on global risks. The most recent study indicates there will be an increased risk of economic disruptions for the next three to five years and a growing digital divide for underprivileged groups.
You should look at potential disasters, employment challenges and world economic issues to start. Identify anything that might impact your business negatively.
2. Write Out Uncertainties
Are there things you worry might occur but they also might not? Write those out. You can better plan for them if you have an idea of what might happen. For example, if you worry you’ll grow faster than cash flow can keep up, jot it down as a possibility.
3. Prepare for the Worst
Once you have an idea of the risks, prepare for them. If you worry revenue will cut in half if the pandemic lingers, then how will you survive that scenario? What is your Plan B and Plan C? You may even need a Plan D and Plan E.
Come up with a way to reduce the risks or respond to them so you aren’t blindsided by any sudden shifts.
4. Implement Solutions
Are there processes you can change now that will decrease risks? For example, if you have a risk of a data breach, you can add better firewalls and employee training on keeping data safe. If you worry about cash flow, you can set a new policy to set aside 10% of profits every month for an emergency fund.
When Is the Right Time?
The simple answer to this question is right now. It’s never too early to perform a risk analysis of your business process. Look at the safety of your workers, the potential for damage to your equipment or reputation, how to stay afloat if cash flow stops and how to protect user data.
Dig deep into the processes you use for everything from marketing to sales to employee retention. Change anything that doesn’t measure up and your risk analysis will grow easier with each new look at your business.
Eleanor is the editor-in-chief at Designerly Magazine. She’s also a freelance web designer with a focus on user experience. Eleanor lives in Philly with her husband and dog, Bear