Managing Risk, part 2

In Managing Risk, part 1, we talked about identifying your company’s areas of biggest risk. The biggest risks are those that are most costly and most likely to occur. With a focus on the biggest risks, consider how those risks are most likely to show up in your business. What are some ways to mitigate those risks or protect against incurring significant liability if they do occur?

Get insurance. If you don’t have insurance for your business get some. At minimum, make sure you have general liability insurance. If you have employees who will be driving company vehicles or using their own vehicles to perform work tasks, make sure you have auto insurance. If you perform professional services, you will likely need professional services insurance. If you’re operating in the digital space or operating your business using various digital technologies, you will need to consider cyber insurance to protect against cyber attacks, data breaches and other harms.

If you already have insurance. Take some time to review your policies and ensure they still cover the areas where you need the most protection. Make sure the coverage limits are still adequate as your business continues to grow.

Write effective policies. If your business runs on task lists and not much else, it’s time to create some structure that will help reduce risks in your business. If you have employees, this step is a must. Consider how your business operates. What do your employees need to know about how you expect the company to operate? If you provide technology (phones, laptops, iPads) to your employees, do you have guidelines around expected use? If you provide company vehicles, where do you set the expectations for use? Are there particular regulations your company must adhere to in order to remain compliant? How do your employees know those requirements? Documented policies and procedures help protect your company by providing your employees the information and guidance they need to perform within the boundaries set by laws and regulations and you as a company leader. Equally as important, it helps you and your employees know how they will be held accountable in the workplace.

Coming up we’ll discuss how to craft practical, protective policies and procedures.