Small Business Risk Management Tips

Small Business Risk Management Tips

While most business owners know that risk is a part of business, small businesses tend to overlook risk management. This leaves them open to negative impacts, loss, and business failure. Coming up with a small business risk management plan can help to mitigate risk and protect profitability.

What is Risk Management?

Risk management is a process for identifying risk, measuring its potential impacts, and coming up with ways to eliminate or minimize sources of risk. A small business risk management plan is a written policy that takes into account as many of the sources of risk to the business as possible. It may include evacuation plans for fires, floods, and other natural disasters, as well as ways to minimize risk from financial decisions, client default on payments, and other business concerns. Small businesses can be particularly vulnerable to risk because of their small sizes and low operating budgets.

Identifying Risks

The best place to begin a small business risk management plan is by identifying risks associated with doing business. These risks are generally business or industry-specific. The first step is to go through the business plan and look at every area of the business. Make a list of areas where risk is possible and brainstorm negative events that could happen, from the likely to the very unlikely. Approximating how likely these events are to happen will help in deciding which risks need to be addressed first. The next step is coming up with a way to manage the risks.

Mitigating Risk

There are four basic categories of strategies for managing risk. The potential negative effects of a risk can be reduced, for instance by instituting a back-up plan for computer data. A risk can be managed by transferring the risk to another party, usually an insurance company. This strategy works for risks that are fairly common, like fire or theft. Accepting the consequences of a risk and budgeting for it can work in areas where the negative impact is likely to be fairly small. Finally, risk can be avoided entirely by eliminating a high-risk area of business or outsourcing it.

Managing Risk

Once the organization has come up with a small business management plan, it is time to implement it. While large companies often have risk management departments to handle risk management, a small business most likely has one person or a small committee in charge of compliance and monitoring. Risk management is an ongoing process in any business, as it is important to keep tabs on how effective the plan is and if it needs updates. In addition, employees must be trained in risk management procedures, particularly in safety and disaster readiness.

How to Get Help

Small business risk management may be more complicated than risk management for larger companies, if only because a small business may not be able to hire a person whose only job is risk management. Small business owners may want to hire an outside consultant or risk evaluator to help with the identification of risks and with coming up with a risk management plan. These consultants may be fire marshals or other compliance officers. They will also need to comply with OSHA and other legal regulations, so it’s important to do research before coming up with a plan.

Small business risk management planning is often overlooked as a part of beginning a business, but it is crucial to the smooth running of any business. Make sure that your small business has a risk management plan before it opens its doors!

The world’s first self-driving public shuttle is smart, efficient, and adorable

Watch it, Google. (Courtesy of WEPods.nl)

Meet the cheery little WEpod: the first-ever driverless shuttle to travel on public roads.

Made for transporting six passengers at a time, the shuttle—which has only been tested in private areas until now—will debut on a route between two towns in the Netherlands starting in November, The Telegraph reports. The project is the child of French vehicle manufacturer EasyMile and EU-funded transportation initiative Citymobil2, which has already helped transport 19,000 passengers in similar driverless shuttles in Finland.

Though various forms of automated public transport already exist in cities around the world, the Netherlands’ WEpod will be the first to drive in normal human traffic. Passengers can use an app to book rides on the shuttle, which is expected to expand from its initial one-line route to serve various other Dutch regions by next summer.

The vehicle will travel at a slow crawl of 25 kilometers (15 miles) per hour, and will not—at least for now—attempt to travel at night or in bad weather.

Image courtesy of WEpods.nl

Autonomous public transport has long been of interest to local governments, who see it as a way to replace outdated transit systems with safer, cost-efficient vehicles. But as transportation experts have pointed out, it’s not as simple as mastering the technology.

The infrastructure of mass transport itself needs to be rethought—a daunting task to which no company experimenting with driverless technology, not even Google or Uber, has yet risen. A recent report from the Center for Urban Transportation Research in Florida found that in the US, at least, autonomous vehicle technology is far more advanced in the automotive industry than in the lagging public transit industry.

The EU’s Citymobil2 program aims to make the latter a priority. Already, it’s helped launch autonomous shuttles in pedestrian areas in Switzerland, and put a driverless bus in central Greece.

Watch a demonstration of the WEpod technology below:

Why I wouldn’t bet my house on LTE in Africa

Young people expect broadband internet to be cheap and fast, an advantage for Wi-Fi.(Reuters/Enrique de la Osa)

I saw a recent article from Quartz Africa about Smile Telecoms raising money to expand 4G LTE networks into Africa. It’s a good story. Wireless broadband is the future, and Africa is the continent of opportunity.

I just don’t buy the strategy.

Telecoms is a long-term business with long-term investments and long-term rewards. Building for the long term means ensuring your foundations are rock-solid.

It’s one thing expanding off an existing base of profitability, i.e.: MTN or Vodacom. It’s an entirely different thing starting data networks from scratch, especially when you rely on a competitive advantage provided by LTE spectrum.

“Spectrum” is another word for “frequency” and refers to the specific portion of the airwaves that a wireless operator uses to offer voice and data services. The first GSM networks operated on 900MHz and 3G operates on 1,8GHz

Unfortunately, spectrum rights are not rock solid. What the government has granted, the government can take away.

Not only do you pay through your nose for the spectrum rights, but you’re burdened with license obligations for infinity. These obligations are not set-in-stone. Every year the regulator makes up new obligations.

“Oh look, he looks like he’s making money, let’s force him to connect another 1,000 schools to the Internet for free.”

This is all well and good with voice networks. The high margins means there is plenty of cash to go around.

The data pricing paradox

The problem is data. People expect data to be free. That means data networks must be lean and mean. There is no room for surprises. Especially surprise costs. Worse than unexpected expenses is the risk of one day getting a letter saying your spectrum has been nationalized.

Some people think this is impossible. No government would jeopardize such an important industry by messing with property rights. And yet that is exactly what the South African government did for mineral rights. It cancelled all mining licenses and asked companies to reapply. And they did this to the single biggest earner of foreign exchange in the country.

The rationale makes sense to me. Redistribution of economic interests in the economy can’t happen without radical intervention. The Afrikaners did it when they took control from the United Party in the 50’s. Now it’s the turn of non-white communities.

You can’t cure cancer without chemotherapy.

This happens all over the world, not just Africa. The only way to mitigate this risk is to bribe politicians. “I’ll pay you to maintain the status quo.”

In the age of the Internet I wouldn’t want to build a business based on bribery. That’s not a rock solid foundation. There are no more secrets. The Internet is here.

And anyway, bribery only gets you so far.

People want cheap fast broadband. WiFi is a standards-based technology with global adoption and fast-accelerating device footprint thanks to smartphones.

How do stop the WiFi wave?

 The future of wireless broadband in Africa is WiFi. No regulators, no license fees, no uncertainty over property rights. 

You can’t. If the customer wants hotdogs, don’t sell him hamburgers. People want WiFi. You must rather figure out a way to build data networks that let you make a profit whilst selling fast cheap broadband.

The future of wireless broadband in Africa is WiFi. Wireless broadband over public spectrum. No regulators, no license fees, no uncertainty over property rights.

If you’re a new kid on the block you are faced with two paths: Go down the LTE path and deal with the incumbents, governments and the risk of signal interference technology rendering your spectrum worthless before you’ve generated sufficient return on capital.

Or, go down the WiFi path. There are already tens of thousands of profitable WiFi operators across the world offering fast affordable wireless broadband, so its not a risky business model.

Remember Moore’s Law

It’s just a question of whether you believe the original Moore’s Law, i.e.: transistors on integrated circuits will double every year, applies to WiFi technology.

Warren Buffet talks about his two golden rules:

1. Don’t lose money.
2. Never forget rule No 1.

In my opinion you are guaranteed to lose money building a business from scratch on LTE spectrum. The best way to avoid trouble on a dangerous path is to not take that path.

Steve Jobs said Apple is a company that chooses which horse to ride technologically. Apple wants to rides upward curves which is why it abandoned Flash and floppy drives when it became apparent they were becoming obsolete. More than 75% of internet video was in flash when Apple killed support. Today Flash doesn’t exist.

WiFi is the upward curve. LTE is the new Flash.

Smile is unlikely to make money for shareholders by paying dividends. It will probably make money by being sold to a big telco that is desperate for LTE spectrum.

Regardless of who owns the spectrum, it will fail to meet the expectations of shareholders.

LTE is the new telecoms bubble, and just like the 3G bubble of the late 90’s, this one will end in tears.

Africans’ financial lives—from getting paid to taking out loans—are happening on mobile phones

A visit to the bank. (Reuters/Noor Khamis)

It’s no secret that mobile money is the primary banking tool of choice for many Africans. This year alone, $33 billion is expected to change hands via mobile services on the continent. That’s almost much as the GDP of Ghana.

A recent survey done by SOKO Insight, a research firm, looked at mobile-money usage in Ghana and Kenya, where almost two-thirds of mobile owners now have mobile-money accounts.

And where it was once mainly a tool to send and receive cash, mobile money has also become an increasingly common way for people to pay their bills, receive their wages, and even get loans:

The rise of mobile money in Africa has put traditional banks on the defensive, with mobile-phone companies doing double-duty as financial institutions. Still, banks remain the provider of choice for financial products, according to SOKO Insight’s survey:

But for how much longer? Users say mobile money is almost as easy to use as traditional financial services, and more affordable:

Banks have responded to the competition by coming up with their own mobile-money platforms, in some cases partnering with mobile carriers to do so (the classic “if you can’t beat ’em, join ’em” strategy). Kenya’s second-largest bank, Equity Bank, launched Equitel earlier this year in collaboration with Airtel. It gives a whole new meaning to the concept of a “phone bank.”

The end is nigh: Robots and drones are working together

The robot uprising seems to be closer every day. Scientists from the Swiss Federal Institute of Technology (ETH) Zurich have built a robot dog that has a built-in pet drone it can deploy from its back Popular Mechanics reports.

Last week, researchers from ETH Zurich showed off a team of drones that could work together to build a bridge, without any human interaction. Now, the university has also created a frisky, capering robot with rather creepy giant blue eyes that works in tandem with a quadcopter drone.

The robot was created by the Autonomous Systems Lab at ETH Zurich, the lab’s deputy director, Marco Hutter, told Quartz. The drone on top is controlled by a winch, which is powered by the robo-dog.

Hutter said the drone would provide the autonomous robot an “eye in the sky,” and could potentially be developed to aid in search and rescue missions. The drone could act as a scout for the robot, showing it which way to proceed in an emergency situation. (Extrapolating wildly, this research could also set us upon the path to figuring out how to effectively build the first real version of Voltron.)

Hopefully, however, these robots don’t team up with Google’s Atlas robot, which can now barrel through the forest, or find the North Dakota police’s mace-equipped drones—or humans might be in for some trying times.

5 Things You Wish You Knew Before Starting Photography Business

1. Be More Than a Photographer

Having great photography skills is what will prompt you to start the business, but this won’t be sufficient to run it in the long run. Starting a business demands wearing dozen of hats at once. You are photographer along with a customer service expert, you are a book keeper along with a marketing manager, and you are a social media executive along with being your own secretary. To get the most out of your business, take charge of all the aspects necessary.

2. People Skills are Most Important

Despite of the fact that a photograph is a personal trophy, the photography business itself is a people business. No matter what kind of photography you prefer and like, ultimately you are going to work for your clients. Your business will flourish best when you and your clients are on the same page. Try reading a book called How to Win Friends & Influence People. This will let you have great relationships with your clients which in turn will help your business grow.

3. Do Not Spend on Flamboyant Gears & Accessories

To bring that extra dose of panache to the business, many young photographers indulge into shopping sprees that include having fancy bags, lens and stands. The loop hole is that, for a photographer, purchasing new accessories can be addictive. It’s hard to convince yourself that the new stylish lens won’t help you in bagging new and better clients, because it just doesn’t. Stay focused and stay away from distractions.

4. Branding Is As Important As the Lens

Instead of stuffing in fancy accessories and irrelevant office stationeries, you should focus on having a strong brand appeal on social media platforms. The traditional form of advertisement is a passé and is useful only for certain big companies, but for a photographer, whose prerogative is to showcase his skills, and not spread out information, a social media presence is almost vital. You can begin the process of branding by ensuring a creative social media page design.

To attract sales and get your startup off the ground, you’ll want to advertise. You’ll want to market your expertise in the field of photography. You’ll need a logo, for one. Professional business card design, for sure. Website that you can use to build awareness for your brand, that is important too.

5. Go Easy on Your Clients

When dealing with your clients, know these 3 golden rules.

• Create a flexible payment system.
• Develop PDF’s for them in the entire process.
• Understand the importance of someone hiring a professional photographer

Photography is a powerful medium of expression and communications that offers an infinite variety of perception, interpretation and execution. Business on other hand is about profits, time management, client handling and brand reputation. The alchemy of arts and business is a skill too hard to master, says photographyconcentrate.com. Hopefully, for some of you, these above listed steps will come as a blessing in disguise.