Ensure success by identifying the most common threats to your business.
When running a business, you need to know how to manage your risks. You need to know which events are most likely to happen and focus your efforts accordingly to prevent such things from taking place. You need to know where to put your investment dollars to protect your business from any untoward events and help you get back on your feet when disaster strikes. Needless to say, accurate risk assessment plays a vital role in ensuring the continuity of your business.
How to Identify the Most Common Business Threats
Here are the steps you need to undertake to identify the most common threats to your business:
- Identify events that may negatively affect your operations. Determine which set of incidents can have a significant impact on your business. You should also determine the likelihood that such events will take place, when they are most likely to happen, and how long the damage will last.
- Evaluate their impact. Once you have identified the most common threats to your business, you should evaluate their impact in worst case scenarios. Determine what you stand to lose when such events take place and whether or not they are require any preventative or mitigating actions.
- Design solutions. After assessing the threats, you should identify a separate set of events which will help you determine the best course of action in case any untoward event happens (response triggers).
- Have a regular periodic review. You should regularly review your list to check the current assessment of likelihood and to add newly identified threats.
Some of the Most Common Threats to Small Businesses
- Natural disasters. This includes tornadoes, hurricanes, floods, earthquakes, lightning fires and wildfires.
- Man-made or technological events. This includes fire and explosions, industrial accidents, chemical or hazardous material spills, communications and utility outages, systems disruptions and transportation accidents.
- Malicious attacks such as acts of terrorism, bomb threats, vandalism, threats to reputation (both online and off), protests, civil unrest and/or riots, robbery and armed intruders.
- Cyber attacks. Denial of service, computer viruses, worms and/or Trojan horses, cyber-warfare and cyber-terrorism can be included in this list.
- Loss of workforce due to long-term disability or illness, epidemic, fatalities and worker strikes.
- Supply chain disruption as a result of counterfeit parts, regulatory requirement violations and/or transportation disruptions.
- Human error resulting from poor training or equipment maintenance, carelessness, misconduct, fatigue and/or substance abuse.
In addition, most US companies also perceive the following events as serious threats to their business:
- Rising healthcare costs (67%)
- Increasing cost of employee benefits (62%)
- Legal liabilities (58%)
- Widespread economic uncertainty (57%)
- Attracting and retaining top talent (50%)