Credit Matters Blog

Why Is Risk So Often Ignored In Business?

Kim Radok 20 March 2017


Since the first business was created, there have always been risks. Despite all the historical and current evidence, business risk is still a marginalised focus in business. To some extent, we can understand why this happens. A focus on risk is usually associated with negativity and deemed to be a waste of time and money by many business people. This negative attitude still persists with business owners and management professionals today.

The marginalisation of risk starts from the very beginning when people first contemplate going into business. There is almost unlimited information and events to help people who are considering going in to business. It is rare to see however, any emphasis on risk factors or of the risk management professionals which may help minimise the risks in business. More disturbing still, if a risk management subject should be on offer, many participants seem to be uninterested.  

In the case of specific risk management education forums and events, it is unusual to see other senior management professionals from sales, marketing, administration etc. in attendance. Respectively, I suggest is just another indication that risk management issues are rarely of concern to senior management. Probably the best example I see on a daily basis on the lack of focus on risk, is to see how many businesses enterprises cannot even take a purchase order or raise an invoice properly.

In addition, when it comes to issues on the negative impact of fraud, social media, government regulations are eroding a trading entity's rights, whistleblowers etc. many business and management professionals seem oblivious of the negative consequences and how to avoid the risks in the first place.

Your own business's employees and the firms which offer risk prevention services, are not the enemy. They are your allies in the battle against the risks to your business. Their advice and assistance is not geared to stop you doing business. The professional advice and service they offer is designed to help you do better business with less worry.

An old business acquaintance use to ask, "What keeps you awake at night?" I can vouch from my own business experiences on what has caused me the most lack of sleep and you will be nn different. A risk known with unknown negative consequences, will cause you the greatest level of stress and more sleepless nights than you can image.

The risks to a business today are many and simply cannot be ignored. When risks are managed probably, any costs of a negative event can be minimised. Once you understand and manage risk, you will also sleep better at nights, and that is a priceless benefit.