Risks are a part of all businesses, with starting a business up near the top of the list. The only way to remain ahead of the competition and achieve success is to be aware of the types of risks you face, the types of risks that come out of nowhere and how to take a calculated risk that ultimately benefits your company.
Types of Risks
So what kind of risks are we talking about? There are a number of different risks you might take with your business, as SmallBizConnect outlines on its site. Maybe the risk might be strategic, or compliance-related involving certain laws or regulations. Or maybe it’s financial-related either in financial structure or a financial decision such as taking a loan. Maybe it’s an operational or environmental risk that’s outside your control like an economic or global financial crisis.
Risks You Might Not Be Aware of
While you might be aware of the possibility of some of the risks above, some small businesses fall prey to a number of risks they didn't even see coming. Intuit shared a blog post on “5 of the Biggest Risks Small-Business Owners Face,” many of which you may not think of.
For example, an open comments section on a company website could leave room for negative comments, or firing an employee could result in a wrongful termination or libel or the like could result in lawsuits. What about security breaches? Are your WiFi, website and employee devices secure? What about living in an environmental hazard-prone location? Sometimes risks are unavoidable, but it’s how you bounce back from their impact that makes your company stronger.
Taking a Risk to Build Success
As a small business, choosing to take a risk can be scary. As President John F. Kennedy once said, “There are risks and costs to action. But they are far less than the long range risks of comfortable inaction.”
ShiftPlanning talks about taking “calculated risks” by planning ahead and starting small in order to build confidence for larger risks in the future. Not only can taking risks impact the success of your company, it can show your employees that you’re a leader willing to do what’s necessary to improve the company and ultimately the lives of its employees.
Donal Daly, CEO at The TAS Group, shared on LinkedIn his story of how he took a risk that led to his first company. Daly disagreed with how his boss was running his company, so he left and after six months of having no job he simply started his own company and is now on his fifth company!
No stranger to successful risk taking, Daly lists the following “10 Benefits of Taking Risks:”
- You’re driven to learn new skills
- Embracing risk helps you to overcome the fear of failure
- It empowers you to break through self-imposed limits
- You become more creative
- It helps you clearly define what you really want
- You break free from ‘average’
- You uncover unforeseen opportunities
- Your self-confidence grows
- You learn to trust more, because you have to
- You don't achieve your dreams by playing it safe
Ultimately, risks are a part of all aspects of life, and when it comes to your business, taking baby steps toward calculated risks can make you more confident and help you grow your company in ways you never thought possible.
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