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1. How to optimize risk
in entrepreneurship-
Venture care |
Professional business
plan

2. Risks and entrepreneurship go hand in hand. No business owner should just believe it and be
passive. Of course, risks should be mitigated or at least be reduced.
Professional business plan
Let me clarify that risk is not always bad for business and its owner. Entrepreneurs should
take the calculated risk. First of all, let us discuss what the benefits are of risks in the
business:
It refines vision and mission of the company
It makes the organization more proactive in handling any kind of situation
It makes decision makers more aggressive
It helps in devising flexible strategies for the organization
It sends positive energy to the middle and junior level management
It helps organizations in reaching new height of growth
It helps in forming much more loyal and dedicated team for execution
However, it is an injustice to say that there are no cons of risks:
Frequent failure of strategies may dishearten the top management
Competitors may acquire the failed organization
Execution team may leave the organization
Sense of fear may develop across the organization
Future contracts may be canceled
There may be socioeconomic pressure from stakeholders including government
It is general notion that a start-up always faces a higher degree of risk. But, this is not completely
true. A bigger organization will always face a higher degree of risks because of large size, huge
financial obligation, bigger team, global operation etc. Shifting from one strategy to another to
reduce risk is time taking and by the time it takes the alternative course of action, the aftermath of
risk becomes severe and unmanageable.
In contrast, smaller organizations including start-ups can shift to alternative strategic plans soon to
mitigate or reduce risk.
Let us discuss that what kind of general risks an organization may face:
Management risk- any of the key persons leaving the organization
Product risk- failure of product because of being out-dated or competitors came up with much-
advanced product or associated services
Team risk- execution team leaving the running projects suddenly
Suppliers’ risk- vendors/suppliers canceling the contracts at very short notice
Legal risk- companies falling into litigations with competitors
Environmental risk- sudden development of rules and regulations by state or central
government putting pressure hard to survive
Financial risk- inability to service debt or not meeting financial expectations of outside equity
providers

3. A general approach for mitigating or reducing the impact of risks:
Try to forecast the risk- although it is difficult in changing the business environment to some
extent it is possible as well as desirable.
Do not ignore ifs and buts- always have back up plan; be it related to product/services
modification, new launch, execution team etc.
Communicate well inside and outside the organization- miscommunication will create risk
Maintain relationship- develop and maintain relationships with current customers/vendors
and also with past vendors.
Raise finance only to the extent of requirements and stage-wise
Focus on cutting down the operational and other costs
Develop new way of marketing
How to start an online business
To conclude:
A risk is a double-edged sword. Taking risk is good but mitigating the impact of unwanted
risk is desirable. Understand your business and business dynamics very well and deeply. Do
counter attack if possible and required.
If you have any query please comment in the comment box below or call us on 020 65363633

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