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How To Write A Risk Plan For Your Small Business

Don't have a risk plan yet? Fear not! We wrote a comprehensive, step-by-step guide to get your company started on your risk plan.

Step 1: Identification

Review your processes to identify potential risks that could arise. If your processes aren't explicitly written down, make sure you do that! Going through the act of writing and reviewing your procedural documents helps to identify holes in them and how that can play into a potential risk. For some tactics to identify your risks click here.

Step 2: Nomenclature

Define the levels of risk that your company wishes to use. Will each risk be assigned a number from 1 to 10? 1 to 5? Will you instead adopt a very low to very high nomenclature? Decide this amongst your leadership and then assign a level to each risk that you identified. Be transparent with this system to every employee at your small business, as each person should be aware what constitutes great risk and how this plays into time sensitivity.

Step 3: Risk Register

This is where you get down to the nitty gritty of your risk plan. Your risk register should include every risk identified, the level of risk, the estimated probability that the event will occur, how the risk could impact your company, who will take the lead on dealing with the risk, and how you will prioritize each risk. You can find a template of a risk register here.

Step 4: Response Plan

For the most probable risks or risks that are on the highest end of your determined levels, you should think about creating a detailed response plan which would include a step-by-step guide of what each employee's role is in managing the risk. You can read about risk response strategies here.

Step 5: Distribution

Make sure you distribute this information to employees at every level in your small business! Implement the response plans and knowledge of nomenclature in your training procedures. Even print out copies of your risk register for handbooks or have them laminated and kept in employee-only areas! Your risk plan can't help you unless all of your employees understand their role in the process (even if their role is to stay out of the way)!

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