I was listening on the radio earlier today about a business who hadn’t anticipated the drought and didn’t have the water resources to continue his business of growing vegetables. I contemplated how people miss the importance of identifying risk when planning their business and felt it was an issue that people who have an RTO must be reminded of.
When planning your RTO, as with any other business, the identification of risks within your environment and the external environment to your RTO is extremely important.
Risk is one of the most overlooked areas in small businesses in spite of the fact that it is clear to most small business owners that operating any business involves risk. While taking a risk and winning is fun, prudent business owners take care to minimize the risk, just as you would in any other type of risky venture you undertake. A good risk management system is a continuous process of analysis and communication.
The risk management steps are:
• Define our Goals and context (i.e. our the risk environment)
• Identifying risk
• Measuring it
• Formulating strategies to limit it
• Carrying out specific tactics to implement those strategies
• Continuously monitoring the effort
• Continuously communicating and consulting with stakeholders.
This information is relevant for your initial RTO set up as well as continuing registration. Remember to revisit those risks, and reassess them.
until next time
Merinda