Understanding 3 Risks in Consultancy Firms

          

         Risk is inherent in everything we do. In business, as in our everyday lives, the way risk is managed is an integral part of success. The need for and importance of risk assessment and risk management is now widely regarded in successful commercial and public sector organisations. Organisations that fully understand and appreciate their risk profile and environments can make informed decisions on how to best achieve their objectives.  Organisations that fail to recognize and manage their risks can destroy value for their stakeholders, squander resources and ultimately damage their image and reputation.
Here's a look at three of the biggest risks that management, marketing, and other business consultants face every day.


#1: Data Breaches

          You're probably sick of hearing about data breaches in the news. But the truth is that they're not going to just disappear. If you store client data on your servers, you will probably become a target for hackers. Significantly, if you work as an HR consultant, you can play a vital role in preventing data breaches on your clients' systems. Besides that, there are studies that show a surprising number of data breaches are inside jobs caused by dishonest employees. Many of others are consist of unintentional goofs on the part of workers. By dealing with HR issues before they become a huge disaster and helping train your clients' employees in data safety protocol, you can help prevent costly breaches and the Professional Liability Lawsuits that might follow. 



#2: Dissatisfied Clients

         In a perfect world, your clients would follow your advice to the letter and see the kind of results you predict. But we all are aware that we don't live in a perfect world. Hundred of forces are at play in the business world, and your recommendations may not get implemented as you outlined, which can then lead to lackluster results and unhappy clients. Dissatisfaction can be a headache that could probably lead to major problems, depending on how your clients handle it. If they decide to sue you for failing to perform your job adequately, your Professional Liability Insurance can cover the court costs. 



#3 Client lawsuits

      Inaccurate tax returns, bad investment advice, or other mistakes could lead to a professional liability lawsuit. Finance consultants could be sued for these errors and the losses their clients suffer as a result. According to a research in 2017, 11 percent of all consultancy malpractice lawsuits come from mistakes in bookkeeping and miscommunication with clients about their expectations for your work. Professional Liability Insurance protects you from the cost of these client lawsuits. Even if a client unfairly blames you, this Insurance can cover the cost of defense for your firm and pay damages to the client.

However, we can manage these risk with proficient risk management. Risk management helps you make better business decisions. When you practice risk management, you try to reduce things that may have a negative impact on your business. You also look for opportunities that can have a positive impact. It allows you to identify the different types of risk and when events in your business will allow you to dictate the opportunities from the uncertainties. Some of the steps to identify, analyse and evaluate your business risks include Identify - note the risks your business may face; Analyse - work out the level of risk and which ones are most urgent; Evaluate - compare the risk against set risk criteria to decide what action to take. 

In conclusion, businesses should implement a good risk management plan to minimize all the possible risks to its lowest. Hope these information helps!

Comments

Post a Comment

Popular posts from this blog

Are you Economic Savvy?

Image
The budget is a critical planning tool for an organization. When developing a budget, it is important to be as concrete and specific as possible about future income and expenditure. The budget must consider direct and indirect costs and enable the organization to allocate and plan for the coming year. Budgets are prepared before the start of the fiscal year, so unknown factors need to be predicted. Budget analysts review historical trends as well as make assumptions about upcoming expenses to try and accurately predict the organization's financial situation for the year ahead.  After doing a thorough research on property development, these are some of the economic factors that help to formulate our department's budget.  Exchange Rate of Australia -  There is a direct effect on the prices of goods and services produced in Australia relative to the prices of goods and services produced overseas.  The indirect effects of exchange rate movements arise bec...
Read more

3 Common Issues Faced by Small Business Firms & How to Avoid It

Image
            With the fast-changing landscape of the industry, many business organisations are facing challenges every single day. However, small business firms tend to not be as stable as compared to bigger firms, mainly due to financial reasons. With lesser capitals, lesser profits and lesser cash flow, these seem to be the problems that are restricting smaller business firms to expand their businesses. There are a few major reasons to it.  #1 Advancement of Technology        As I have previously mentioned, small companies usually do not have sufficient funds to keep upgrading their internal or external systems from time to time as they are very costly.  How to avoid it: Devote time and energy in finding the correct accounting software programs for your company, or to find outsourcing firms that offers them as a package. This helps firm to not spend unnecessary money and also to maintain their budget....
Read more

How to Build Good Workplace Relationships

Image
      Based on a research done by Gallup Organisation, it is said that people who have best friends at work are seven times more likely to be engaged with their jobs. This illustrates that building good relationship in your workplace in essential to improving your work efficiency. Today, I will discussing 3 ways on how to build positive relationships in a workplace. #1 Develop your people skills Firstly, it is important that you master comfortable body language . Active listen by nodding, listening and paying full attention to that person you are talking with are common ways to show that you are handling your body language well.  Other than that, understanding cultural norms . Each individual in a workplace might come from different backgrounds or even different countries, it is important that we show respect to each other. For example, instead of shaking hands, Japanese will bow to each other during their meeting to show utmost respect.  ...
Read more