Many businesses make the mistake of treating business risk like ‘the elephant in the room’, pretending that it isn’t there and hoping that it goes away on its own. However, business risk should not be something we can afford to avoid; rather it’s something that we should embrace.

Is risk always bad?

The word “risk” inherently carries a negative connotation. It suggests instability, danger and liability. In a business context, risk can be associated with a threat to cash flow and ambition. However, every business carries a certain level of risk. And like all risk, sometimes it can be reckless, while sometimes it can reap a greater reward.

Therefore, instead of trying to avoid risk at all costs, you should be identifying positive risks and eliminating the negative in order for your business to thrive. This turns your focus to what is known as “risk management”, a vital ingredient of success in a risk and reward capital system.

Identifying the types of risk

In this increasingly complex world, risk can come from technology, compliance, finance, strategy, market, and human factors, to name a few. But broadly speaking, they can be divided into two categories – tangible and intangible. Examples of tangible risk include product risk, accounting risk and manufacturing risk. On the other hand, reputation risk, cyber technology risk and internet exposure are examples of intangible risk.

At Blackhawk, our risk management team doesn’t just aim to address singular problems when they arise; we’re interested in working with you side by side and tackling this subject from a holistic approach. This way, we don’t just do a tick-all-the-boxes exercise, we strive to understand your risk culture – the system that underpins the values, knowledge and attitudes present in your company which can influence your risk decision process – and address it accordingly.

Managing intangible risk

Intangible risk, as the name suggests, isn’t quantifiable and it’s hard to predict or control.

Cyber threat is a great example. Even with a good cyber security system in place, companies still face the risk of financial loss, reputation damage and other unwanted disruptions. This global problem can affect any organisation, be it big, small, private or public. While most companies place this under IT managers, cyber threat is not just a technology problem. It, therefore, should be placed under risk management and overseen by a C-level executive.

It must be said that having robust risk management isn’t just addressing the ‘negative’ – far from it, it can also help you to unleash new opportunities. Take this example, if your business involves handling sensitive data and you can confidently demonstrate to your clients that you have a strong risk management process in place, chances are they will sign up with you instead of your competitors.

Blackhawk can help to mitigate your business risk

Richard Branson once said that “the luckiest people in business are those that are prepared to take the greatest risks”, referring to one of the distinct skills of great entrepreneurs.

Knowing how to embrace risks is good, we say, provided that you have a team of risk management specialists like us in Blackhawk Intelligence whom you can count on.

Give us a call today on +44 (0)20 8108 9317. We’ll work with you to ensure that everything you know about your business is used to better predict and manage risk, allowing you to embrace risk and strengthen your business into a prosperous future.

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