Smart risk management with a professional stakeholder analysis. The purpose of this blog post is to assess the risks associated with taking smart risks, and provide you with advice on how to mitigate them in order to maximize your chances for success. We will also explore what it means to be a smart risk-taker, and why you should take more of them!
The key part of any successful business venture is being able to identify opportunities for growth while minimizing the downside or potential loss. This requires an understanding of both external factors that are beyond your control as well as internal factors such as company policies and practices which can help or hinder your ability to succeed. Smart risk managers know how important it is not only have a plan but having one that includes contingencies should the primary plan fail.
Understand How Your Company Works and What Policies
The first step would be to understand how your company works and what policies and procedures you’re expected to follow. Once you have an understanding of these elements, you need to figure out where the opportunity lies; this may seem obvious but for some entrepreneurs it can be difficult because it requires them to look outside their direct expertise or industry. You need to seek out a new market that has the potential for growth, one which you have a good handle on and can see how it can be applied to your current business model.
If you’re going into uncharted territory, i.e., unknown market looking for unknown opportunities, what you should do is consider what technologies are currently impacting other industries, are are at the cutting edge of innovation. The idea is to pilot a project that’s related to your current business model but in an area where you can test it out without incurring too much risk. You should then pilot or beta-test this new product or service by testing it among employees, perhaps with customers who are willing to provide feedback. Once you understand the parameters and risks associated with the new venture, then you can begin to formalize a plan and bring it to your management team for their input and approval; be sure to include them in the process early on, as they will likely be contacted by lenders or investors if/when you’re raising funds.
Define the Risks Associated with The Venture
Once you have a plan, the next step is to define the risks associated with the venture. You need to understand what could go wrong and how you can mitigate those risks as much as possible. The idea here is that smart risk management doesn’t eliminate all but it should minimize those events that are outside of your control, even as far as pertaining to market conditions which you cannot affect. As a smart risk-taker, you should always expect the unexpected and be prepared for it.
We realize that taking smart risks can feel risky but in most cases they’re actually worth the reward if done right , but wrong if not. If you work to understand your company’s policies and procedures, seek out the opportunities where you are most likely to succeed, mitigate or eliminate the risks associated with it, and create contingency plans for when things go wrong–you will master smart risk management.