Tips for Managing Risk within your Business Venture

Most often, entrepreneurs and other small business owners think that only large businesses and multi-national corporations should be concerned about the subject of risk management. However, this is a very wrong notion as the impact of a risk exposure can be more fatal to smaller businesses than large ones. Remember that the large businesses have deeper pockets and can afford to write off big amounts as “extraordinary occurrences”.

This week, I wish to share simple tips that can aid with the management of risks faced by small businesses. Generally, risk management refers to the practice of identifying, understanding and mitigating occurrences that can prevent the achievement of business objectives. Thus, the most important thing is to have a clear understanding of what risks your business might face.

Understanding the Risks in your Business

On a general note the key risks faced by most businesses (regardless of size) include operational risks, credit risks, reputational risk and market risk. At a more specific level, this can include employee medical risk, IT risk, travel risks etc. The key to this understanding is to review all possible areas and identify the things that can affect business objectives. This process is referred to risk identification and assessment in the corporate world. “Assessment”, is used here because the business process owners usually go on to assess the identified risk in terms of its possible impact and likelihood of occurrence.

Simple Risk Assessment for Small Businesses

To achieve this in a small business setting, it would help to sit with your overall team, even the janitors and doormen in your employ and go through a structured way to identify all possible risks. Remember, during this process, no risk identified is stupid. After taking down all the possible risks, you can then rate it on a scale of 1-10 via voting to determine the risk impact and its likelihood. Naturally, the high risks will be at the top and vice-versa for the low risks.

Designing Mitigation Strategies

After identification and assessment, the next thing will be to decide which risks (usually the top 5, 10 or 20) to focus on. You cannot focus on all risks and should structure the mitigation process in a way such that the effort to be put in will not be more than the benefits to be derived. This is very key. All members of the team can contribute to suggestions for the mitigation strategies. Though, it is usually helpful if you get an external consultant at this stage, because they are independent and can come up with different and better ways of managing your business risks.

We will be glad to hear your feedback on how this helps and give your further suggestions at a more specific and personal level if you desire.

SMART Tips for Sustaining Business Growth

 

As I write this, the nationwide strike against the Nigerian government’s removal of petroleum subsidy has just kicked off. There is very light vehicular traffic – very unusual for a Monday morning – on the adjoining roads to Berger Bridge which is the take-off point for the Abuja protests. At this time, my heart bleeds for entrepreneurs, 9japreneurs and all other small business owners that have been affected in one way or the other by poor government policies, especially having to spend large amounts on fueling generators to power the business premises. However, 9japreneurs must be resilient and keep finding strategies to keep the business growing regardless of the challenges in the market and in the nation.

On that note, I have decided to share some smart tips that can help kick-start and sustain business growth. The key here is to practice this tips and modify it to suit your business situation. I am not a fan of “one size fits all solutions” since the consulting industry has taught me that no two clients/scenarios/problems are ever completely the same.

Tip 1 – Maintain discipline in all aspects of your business venture

Discipline is very critical to sustaining growth in any business and 9japreneurs must take this seriously for your venture to succeed, especially in a society where government policy is still very unstable. This discipline must cut across all areas of the business including financial spending, hiring, sales, granting credits, performance management etc. If you can afford it, it pays to invest in the development of policies and procedures in order to have a standard process by which you will carry out your activities.

Most importantly, as an entrepreneur, you must divorce yourself from the business venture especially when it comes to spending funds. You must be disciplined enough to ensure that you are not eating into the profits without knowing it. Rather, set a fixed monthly salary for yourself and stick with that.

 Tip 2 – Understand Your Market and Stay Ahead Of The Competition

In today’s highly competitive market, it is very important to have a deep understanding of the market and devise strategies to stay ahead of the competition. It is not enough to try to maintain your market share, rather your company must strive to increase it. A constant review of the successful strategies and unsuccessful ones will give a 9japreneur an idea of where to focus company energy. Also, you must be quickly responsive to changes in the market place, though in a fashion that is risk aware.

Jason Jennings passes advice to stay ahead of the competition with the titles of two of his books namely:

  • Think Big, Act Small
  • It’s Not the Big That Eat the Small… It’s the Fast That Eat the Slow

The strategies in these books are succinct enough to help you stay ahead of the competition at all times.

Tip 3 – Adapt Quickly to Changes

Everything in today’s world, both in business and otherwise tends to change by the minute and 9japreneurs must be able to respond to that change in good time in order to sustain business growth. You must have your ears to the ground and quickly respond to changing customer tastes, payment methods, financial regulations etc. there is so much to keep up with in order to stay ahead.

As an entrepreneur, you must keep an open mind, think of sustainable means of growing your business, re-evaluate previous successes and failures and also foster a culture of innovation. Remember that innovative people are usually able to come up with solutions outside the status quo.

Endeavor to take this tips bit-by-bit, practice them, de-brief them and evaluate reasons for success. According to Entrepreneur Magazine “The more thoroughly you plan each stage of your business activities before you begin, the greater the probability that you will succeed when you commence operations.”

Setting the Right Priorities for Your Business Venture in 2012

A new year is upon us again and this seems to be a busy time for most 9japreneurs. Usually, the beginning of a new year is viewed as a fresh start and a time of new possibilities. Most business owners will be busy re-strategizing and seeking the best way to move their business forward. However, if things are not properly managed at this time you might get overwhelmed and burnout before you know it, especially if your business is still in the boot-strapping phase.

We have highlighted below some great tips you can use to prevent this burn out and achieve maximum value from your effort by setting the right priorities.

1. Understand the direction for your business

The very first thing is to understand what you intend to achieve in this year. Basically, this will involve taking a look at how things fared in the past year, what you did right and wrong, a full fledged market analysis, competitor evaluation and opportunities for growth. There is so much to do in this regard.

My advice is that you focus on the top five internal and external factors that can affect your business while trying to better understand the direction for the year. This way, you can then narrow down to the actual goals and objectives for your venture in 2012.

2. Write down your goals and set realistic targets with timelines

Ensure that your goals for the year are written down, critiqued (by yourself and others) and refined to ensure that all possible areas have been covered. Then, you should set realistic targets and timelines for the achievement of these goals within the year.

Even if these goals are a carry-over from the last year, make sure they are written down so that you will not lose focus on any one.

3. Involve your team and delegate appropriately

If you have the luxury of a good team within your employ, the best you can do is to get them to participate fully in strategic activities as the year begins. Even though you have your vision for the company clearly set out, it is usually more rewarding if you seek their opinions or buy-in on the way forward. This way, they feel more respected within the company and will probably perform better on the tasks assigned if they were part of the formulation. Remember that “our budget” is always preferred than “my budget”, “his budget” or “her budget”.

In our usual manner and for the sake of practicability, we would love that you start out with these three tips and see how well it is helping you move forward as a 9japreneur. We would love feedback from you and also willing to help with any challenges you are facing as a business as the year begins.

Taking Stock and Being the Real Boss in 2012 – Several Opportunities

As I write this, the firecrackers heralding the arrival of 2012 have already been released in Australia and some regions around that hemisphere. Several people in Nigeria and other equally religious African countries are heading for the cross-over service, while I am thinking of how to give my audience great tips to lead and help them through the year. It is just before noon on New Year’s Eve in New York and a few other cities in the US. Bottomline – 2012 is upon us.
The first personal philosophy I will give you is to get a PHD – meaning Prayer, Hard work and Determination. It has worked for me and keeps working. In 2012, pray harder, work harder and ensure that you do not fall by the way side when things get tough. Remind yourself that “It can only get better”.
For Job seekers…
For the young people in my generation, not having a daily job is something very demoralizing. I know people in Nigeria whom have graduated with good grades and completed national service, but are yet to land a job. I understand how this feels, but the best you can do is to keep trying. My first advice to you is to update your resume/curriculum vitae; ensuring that you include volunteer jobs and other vocational activities. As much as possible, ensure that there are no wide time gaps in your CV’s. Another advice from a veteran on CNN says that you should take jobs outside your field, internships or other areas, just to keep you busy.  
Also, search for jobs in non-traditional areas and make unsolicited applications. You never know who will see your CV. Also, endeavour to distribute your CV’s in soft copies, rather than hard copies as the former tends to move faster and reach places you never imagine. While still seeking this job, online areas where you can make real justified cash with your skills, without any capital investment include:
The websites above are just a few of the sites where you can make clean money from, while you keep searching for jobs. Try them out simultaneously. You never know if this will be your passage to wealth. You can get in touch for further information or reference links to help you get started. However, all these sites are DIY styled.
For Entrepreneurs and 9japreneurs
Another group of young people that I love and consider part of my constituency are entrepreneurs and business owners. My advice to this group as 2012 rolls in:
·         De-brief your current business model and see if you can make things better than they were previously;
·         Keep your team – employees – happy, make them feel respected, listen to their thoughts and have one-day retreats at least every six months. If practicable, grant them part ownership of your business.
·         Create and improve an online presence for your business. Willing to share web marketing tools with my readers…It works…for real;
·         Read the ENTREPRENEUR magazine. It is a great free resource for aspiring and current business owners. Visit www.entrepreneur.com.
For Students….
Seek to make the very best of grades while in school and also think about starting a business in your field or area of core competence. Remember that good grades will give you a chance to get a fully-paid scholarship for your Masters. I am also hoping that I can kick-start the first student entrepreneur funding boot-camp before the year runs out.
For everybody….
Some of the greatest websites I have come across in 2012 & 2011, and will continue to visit in 2012 include:
www.opportunitiesforyouth.org – Great Resource for all things
www.entrepreneur.com – Wonderful for biz owners.
www.wordpress.com; www.suite101.com and www.blogger.com – Gives you wings to launch your writing, blogging and business career online.
Make sure you try them out. There is so much more out there. I have just decided to share with you the few ones I have tested, tried and TRUST. Be kind enough to include your own tips in the comments section.
Remember. Be the Boss in 2012. It can only get BETTER.