Running a business comes with many different types of risks. In some cases, taking on a level of risk – such as trialling a new product – can help you grow your business in the long term.
Other types of risk can cause serious damage that can be costly and time-consuming to correct. With this in mind, adopting a risk management strategy is critical to identifying and mitigating risks that could potentially affect your business operations.
The most common business risk categories are:
- strategic – involves decisions about your business goals
- compliance – relates to complying with laws, regulations, standards and codes of practice
- financial – includes financial transactions, systems and structure of your business
- operational – includes operational and administrative procedures and workplace relations
- environmental – includes external events that you have little control over, such as natural disasters
- reputational – relates to the reputation of your business.
No matter the size of your business or the industry you’re in, there are always risks to consider in some or all of the categories above. For example, collecting customer data online puts you at risk of a cybersecurity breach, which can significantly impact your finances, operations and reputation. Anticipating potential risks and making a plan of action for each scenario helps reduce the likelihood of an incident seriously affecting your business.
So, where should you get started with risk management for your business? Take a look at these resources below on mitigating risks in workplace relations, operations, compliance and more – as well as what to do when things go wrong.