There’s only so much a small business owner can control. No one plans for a property loss caused by a fire or a vehicle accident. On the other hand, events like data breaches, workshop injuries, and product failures can be largely prevented. They may be “unforeseen” when they happen, but there are measures you and your workforce can take—together—to help minimize damages or avoid the risks in the first place.
Make Employees Part of the Solution
When seeking to manage risk, adequate insurance coverage is essential. Property insurance covers damage to the physical building and contents of the business, while basic liability insurance protects your company in case something occurs in the process of doing business that causes harm to a customer.
But you can also count on your employees to keep your small business healthy, safe, and successful for the long-haul. Depending on your company’s size and structure, you can enlist anyone from upper-level managers to administrative staff to mobile salespeople in your risk reduction taskforce. Consider these tips to help everyone play their part:
1) Participating in a Risk Management Feedback Loop
Your company’s exposure to risks is vast and varied. You may be vulnerable to internal risks, which include human risks (e.g. illness, errors, theft and fraud), equipment and information technology risks, and even physical aspects of your business such as phone lines and windows. And you also face a range of external risks such as natural disasters, local ordinances or structural changes in your community. (Explore this topic further in 5 Common Threats Small Businesses Face.)
As a business owner, you’ve likely performed a thorough risk assessment to evaluate the likelihood of certain events occurring and the potential impact they’ll have on your business. Communicating these to key employees—and inviting them to become part of the risk management process—helps you spread the concept of risk prevention across the organization.
According to a CEB survey cited in Risk Management, only one in three middle managers and a fifth of front-line managers reported receiving communications or training on the top enterprise risks they personally face in their work, which has a negative impact on how the entire organization is able to sense and respond to threats.
Ask employees for ideas on how to minimize risks they may come up against on a daily basis. They have eyes and ears—and they experience business operations from unique perspectives and can suggest ways to strengthen your plan by tweaking processes or tightening controls. Make it easy for employees to provide feedback at regular meetings, for instance, or more informally, over e-mail or a phone call, as ideas arise.
2. Taking Part in Ongoing Training
You’re already aware how important it is to keep your workers up-to-date on the various aspects of their jobs. Whether your employees work in an office, at customer sites, in a warehouse, on a factory floor or out on the road, they’re required (in many cases, by law) to receive documentation and/or training on any number of workplace health, safety, and regulatory issues. They need to know how to operate equipment, communicate with customers, protect private data, and more. Not only does this training enable them to do their jobs more efficiently, but it helps protects them—and your business—from potential harm.
When it comes to risk management, there may be more you can do to provide your employees with training opportunities. Risk Management recommends building on your existing training curriculum to teach employees about risk management and top risks, using multiple communication channels to educate and engage them.
For example, do your workers know how to spot a product defect? Do they have the tools and resources they need to “fix” a problem for a customer before they file a complaint? Train them how to identify problems before they occur or remedy them before a legal situation arises. Be creative—and open your mind to areas for additional, or ongoing, employee trainings.
3. Playing an Active Role in Daily Risk Management
Why not include your workforce in day-to-day risk management? Even if they’re part of a feedback loop, keeping their eyes and ears open to risky situations or new solutions, they can be part of a daily routine. What makes sense for your business, property, and customers?
You can assign employees with key roles pertaining to health and safety, maintenance, or quality control. Here are some ideas:
- Audit business processes for errors
- Follow-up with customers regarding product or service usage and performance
- Perform safety checks on physical property
- Risk training/reviewing policies with other employees
Your employees are an important part of keeping your business running smoothly—and safely. The idea is to not let your risk management sit tucked away in a binder or insurance policy. Inspire your workers to get involved in protecting all of your assets, employees, and customers so that your business rarely, if ever, is confronted with the “unthinkable.” And even if an event transpires, you’ll have the peace of mind that your team did all you could do to prevent or minimize losses.
If you any questions about protecting your small business, please contact your Acadia Loss Control Representative. If you are not a current Acadia Insurance customer, please contact your local independent insurance agent for information or to obtain a quote.
Acadia is pleased to share this material. Please note, however, that nothing in this document should be construed as legal advice or the provision of professional consulting services. This material is for general informational purposes only, and while reasonable care has been utilized in compiling this information, no warranty or representation is made as to accuracy or completeness.