Being in business is inherently risky. Being successful, sustainable and bankable has more to do with foresight than fortune. In life, nothing is certain but death and taxes. In business, it's change. Technology and globalisation are inevitable levers for change. 40% of the Fortune 500 companies in 2000 were gone just ten years later. Who saw the writing on the wall predicting Amazon and Waterstones would report e-book downloads eclipse printed book sales, or how we now enjoy online music, TV, films, news, articles, and information would decimate entire industries? When Kodak filed for bankruptcy protection under chapter 11 in the US, the winds of change swirled and chilled. This may not be Kodak's finest hour, but for the rest of us it’s a wake up call. What risks threaten, if not our survival, then our sustainable success?
One wonders how Kodak saw the future. It's estimated a that a billion images were uploaded onto Facebook last festive season. In 1975, when Kodak invented the digital camera, no one at Kodak could have dared to imagine such a commercial opportunity. In 2012, dare I ask, why not? Of all the risks facing your business, perhaps the biggest risk is your reliance on Lady Luck, rather than yourself.
Risk Management is the identification, assessment, and prioritisation of risks. How you face up to risk means the decisions you make today, will determine your shape tomorrow. Know your stress points: customer service, product portfolio, business planning, legal compliance, managerial shortcomings, organisational structure. Risk Management isn't about scaremongering. It's about responsibly and honestly facing up to what can hurt you most.