Risk Management is a planning process. Seriously it's that simple.
I know there will be some serious risk boffins and financial risk analysts that may wish to disagree with me, and there are some contexts where risk analysis is a very serious and highly mathematical art (or science, I'm not sure which). For a service-based business, smaller manufacturers, smaller scale construction business or similar, risk management is all about planning. We're talking about within the customer, employee or community context (or better known as Quality, WHS or Environment).
Any business has the capability to identify what their processes are, and where things can go wrong. Better yet they can look at a process and identify opportunities to improve and optimise, then come up with a plan to mitigate or manage those risk and opportunities.
So if you have a small business (or a large one for that matter) take some time to ask the following questions?
1. What does our business do?
2. Step-by-step what do we do to achieve that? Get detailed. Really look at the nitty gritty.
3. In each of those steps
- What is the desired outcome of that step?
- What could go wrong in that step that can- injure an employee, cause us to fail our customer, or cause damage to the environment or community?
- How likely is that to go wrong, and what sort of harm would occur?
4. What have we done to prevent those failures?
5. What can we do better?
6. How do we know those measures are effective?
Sounds pretty simple doesn't it. That's risk management. If you're developing management systems for Quality, WHS or Environment, then you may need some extra specific things to make sure the risks are being effectively controlled, and may need to seek regulatory or expert information.
To get started though... try asking yourself those 8 questions above, talk to your management team and workers to get qualified answers and agreement on the risks. Discuss how the risks will be managed, and come up with a process to monitor the effectiveness of those controls, and document the hell out of it. Before you know it, you might actually have a management system.
Go get planning.