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Developing a Risk Management Plan for a Small Business

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Developing a Risk Management Plan for a Small Business

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Developing a Risk Management Plan for a Small Business

  1. 1. Developing a Risk Management Plan for a Small Business
  2. 2. Developing a Risk Management Plan for a Small Business  Financial professional Jeff Drobny serves as a CIO at the Cargill subsidiary Black River Asset Management. Having served Cargill for more than two decades, Jeff Drobny played a significant role in the launching of Black River and is highly experienced in a variety of financial services, including risk management.
  3. 3. Developing a Risk Management Plan for a Small Business  Although completely eliminating risk from a business is often impossible, proper planning can minimize it. Effective risk management plans guide businesses clear of potential risks that may cost money and time.The following are just a few ways of developing an effective risk management plan for a small business.
  4. 4. Developing a Risk Management Plan for a Small Business  - List the potential risks your business may face, even if they seem miniscule.This is often more difficult than it may sound due to the many areas that you may overlook when thinking about risks.A good way of ensuring you think of everything is to cover social, technological, political, and economical factors.
  5. 5. Developing a Risk Management Plan for a Small Business  - Once risks are identified, completing a risk assessment reveals how likely it is that each risk will occur. A part of this process includes determining who will complete the assessment and what it will cover. Determining the likelihood of potential risks allows for the prioritization of each risk, thus allowing you to focus on avoiding the most likely problems.
  6. 6. Developing a Risk Management Plan for a Small Business  - Planning an appropriate response to each risk, whether its mitigating the risk, exploiting it, or avoiding it altogether, ensures you and your business are prepared.While some risks are easily handled, others are better left alone.Thinking about every possible outcome helps during this process because it allows you to get an idea of what each plan may mean for your company.
  7. 7. Developing a Risk Management Plan for a Small Business  - Finally, determine how often your risk assessment will be reviewed. Regularly checking risk assessments catches any possible risks that are new to your field and allows you to re- prioritize them should things change in your business.

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