Four Components of Effective Risk Management

Every business should invest thought into understanding how effective risk management impacts their bottom line. This conversation should be a continuous dialogue when considering how any business is conducted.

Risk Management is the identification, assessment and prioritization of risks and the subsequent coordinated and economical application of resources to minimize, monitor and control the probability and impact of losses. Effective risk management activities create value and should be an integral part of the decision-making process in every industry and business.

Strategies for addressing an identified risk typically include

  • Risk Avoidance
    • Eliminate activities that involve risk
    • Avoid creating activities that involve risk
  • Mitigation or Prevention
    • Manage liability by structuring activities and programs in ways that reduce or limit institutional risk
  • Risk Transfer
    • Insurance policies
    • Indemnification agreements
    • Releases and waivers
  • Risk Retention
    • Self-insurance
    • Deductibles
    • Deciding not to purchase an insurance policy for a specific exposure

We reached out to Lane Reinert, Loss Control Director of Non-Profit Insurance Services for some guidance on simple things every business should keep in mind when considering risk management.

Lane Reinert, has over 10 years of Loss Control/Prevention experience. He currently holds two Bachelor degrees from the University of Central Florida and is certified in OSHA 10, OSHA 30 AND OSHA 510.

  1. What are some of your favorite free online risk management or safety resources you like to share with clients?

If I had to pick, I would say the OSHA website or the website of the regulatory organization that governs your business type. With OSHA, they have not only the standards/statutes but they also have “standard interpretations” on the site that can help provide insight as to how OSHA is interpreting certain standards.

  1. What are some paid resources you deem worth the investment?

I believe having loss control assessments done (where and when appropriate) by an outside vendor (someone not in the organization) are a great investment as it allows a ‘different set of eyes” to review and offer input as to how organizations can overcome certain barriers they may be having difficulty with. Also, if your organization has “drivers” stay vigilant when it comes to completing your drivers record checks.

  1. Do you have any tips or tricks regarding OSHA reporting you like to share with clients.

When it comes to OSHA, there is never a “casual interview/discussion”. Keep your answers honest and short and don’t “volunteer” information.

  1. What are some small things most companies can do to help encourage employees to be risk aware?

Have meetings (safety briefs/ tool box talks) with your teams to discuss “hot button topics” or reoccurring ones. Maintain records of topics covered and the attendance sheets. Make the meetings short and interactive. Share your successes as a company and some of your failures and how you can/will be better. Create a safety council made up of several layers of the organization and insist those council meeting are “safe areas” to discuss topics freely.

For more great discussion on this topic, join the NAPEO Community Conversation this afternoon at 2PM EST. This session will be focused on risk management and the impacts of COVID-19. You can register for this evert by clicking here.

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