Risk Management for Your James City County Business
There are numerous hazards to consider. For each hazard there are many possible scenarios that could unfold depending on timing, magnitude and location of the hazard.
More than ever, property owners and managers are seeing the value of performing a risk assessment for their building and their business operations. Assessing potential risks and building a Business Impact Analysis (BIA) can be important tools to prevent costly damage, interruption to business, or safety hazards incidents.
The BIA should identify the operational and financial impacts resulting from the disruption of business functions and processes. Impacts to consider include:
- Lost sales and income
- Delayed sales or income
- Increased expenses (e.g., overtime labor, outsourcing, expediting costs, etc.)
- Regulatory fines
- Contractual penalties or loss of contractual bonuses
- Customer dissatisfaction or defection
- Delay of new business plans
Here at SERVPRO of York, James City County and Poquoson, we understand the value that mitigation and prevention hold, so we wanted to share some valuable knowledge about risk assessment with our commercial partners!
The steps to risk assessment:
- Compile a list of assets (people, facilities, machinery, equipment, raw materials, finished goods, information technology, etc.).
- For each asset, list hazards that could cause an impact.
- For each hazard consider both high probability/low impact scenarios and low probability/high impact scenarios.
- As you assess potential impacts, identify any vulnerabilities or weaknesses in the asset that would make it susceptible to loss. These vulnerabilities are opportunities for hazard prevention or risk mitigation. Record these opportunities for prevention and mitigation.
- Estimate the probability that the scenarios will occur on a scale of “L” for low, “M” for medium and “H” for high. We’ll call this measurement “Probability of Occurrence."
- Analyze the potential impact of the hazard scenario. Rate impacts “L” for low, “M” for medium, and “H” for high.
- Remember to estimate potential financial, regulatory, contractual, and brand/image/reputation impacts.
- The “Overall Hazard Rating” is a two-letter combination of the rating you determined in step 5, the “Probability of Occurrence,” and the impact analysis determined in step 6.
- Carefully review scenarios with potential impacts rated as “moderate” or “high.” Consider whether actin can be taken to prevent the scenario or to reduce the potential impacts.
If you’d like to learn more about risk assessment and access a Risk Assessment Table provided online via Ready.Gov/Business, visit their website.
If a property loss event does occur in your business, know that SERVPRO of York, James City County, and Poquoson understands the value of controlling hazards to prevent negative impacts, such as secondary damage. Give us a call at 757-229-3442 or toll free at 1-800-889-5002