Small businesses should embrace risk for growth

VV 21 July

Managing risk is increasingly being seen as essential for growth by many small business leaders.

Company heads these days are challenging the perception that risk can stifle growth and instead making it an instrumental part of their strategy in order to further develop, according to the Risky Business Report by Allianz.

The report showed that businesses are weighing up opportunities against challenges and increasingly recognise risk as the key to innovation, ensuring they make the most of opportunities despite facing potential challenges on the way, Fresh Business Thinking reports.

Rather than avoiding these growth opportunities as they could harm companies, leaders are taking an action-orientated approach to overcome hurdles before they arise.

Implementing a growth strategy is top of the action list, with almost one in three (30 per cent) surveyed for the report saying they have concrete plans to deliver growth in 2013. Other strategies mentioned by leaders included training and development (24 per cent), recruitment (23 per cent) and innovation (21 per cent).

Chief executive officer of Allianz Andrew Torrance said: “Ambitious businesses going for growth do not see risk management as a barrier. Companies who can utilise both risk management and innovation in parallel will find sustainable ways to deliver growth and embrace change and innovative approaches throughout their organisations.”

Some companies are even taking the potential for risk management as a driver for growth to the next level by engaging whole teams to work solely on identifying and planning for potential risks when they are looking at new products or launching a service.

In this way they can spot possible problems with barriers such as customer satisfaction, data security, credit risk, before they arise, as well as develop a plan to solve them. This shows that the distinction between a risk and a challenge is shifting in the minds of business leaders as they seek opportunities to overcome them in order to move forward.

For those leaders who are afraid to take risks, try seeing them as a challenge instead and look at ways to overcome problems before they happen – the growth of your company is at stake otherwise.

Posted by the Secret Businessman