Is Your Business Risk Worth Taking in 2021?

This past year was one marked by risk in so many ways. While January 1 always holds the promise of a fresh start, many of those risks are still alive and well as we settle into 2021. 

Allianz Global Corporate & Specialty (AGCS) recently released its 2021 Allianz Risk Barometer, which identifies the year’s global business risks based on insights from nearly 3,000 experts across industries and countries. They noted that ongoing pandemic outbreaks, business interruptions and cyber incidents are among the most significant risks around the world. 

And while the annual Risk Barometer can serve as a reminder of the importance of risk preparation and management—particularly in the face of so many significant events, many of which have yet to recede completely from our rearview mirror—it also drives home exactly how much we’ve made it through. 

Business challenges, multiple COVID-19 surges, market shifts, political turmoil and more locally and globally: for once, virtually everyone around the world has grappled with tremendous change personally and/or professionally over the last twelve months. And while things may not look exactly the way you imagined they would, and you may be missing a lot—friends, family, the comfort and privacy of your office, dinner at your favorite restaurant and even handshakes—if you are reading this, you have persevered. You have also undoubtedly conducted risk analyses time and again, formally and informally. 

From how to move your business forward to whether to meet up with a friend or even shop at your local grocery store, the current conditions of our global society have required constant consideration and adjustment. And that means you likely have even more experience navigating risk than you might imagine. With that in mind, you may be even better prepared to take a particular risk than you may believe. Moreover, what may seem significantly risky may be less of a gamble than you think. 

How do you know if any one risk is worth taking in these uncertain times? You can conduct a more formal version of the review you probably carry out subconsciously every single day. 

  • Take inventory of your knowledge. With so much up in the air, this is a great time to lay out exactly what you do know, and the efforts that your knowledge can support. For example, while this may not be the time to explore an entirely new industry, you may find that your expertise—and consumer demand—lends itself quite well to a new product or service launch. One can look to the numerous cases of restaurant workers who went on to establish their own food-based businesses when they lost their jobs, or teachers who have realized success providing online courses or leading student pods for insight on what that brand of ingenuity can look like. 
  • Do your homework. So, you’ve got a great idea that seems to have endless potential. Don’t step on the gas just yet. The next step is to do your research. Figure out exactly what you can expect in terms of potential uptake, profit, and more before you pass go. Can you manage if things cost more than you expected or don’t ramp up as quickly as you hoped? And don’t forget all those factors that threw us for a loop in 2020. Stress-test your concept against lockdowns, extreme weather, an economic crash and more to see if it can handle everything 2021 and beyond may throw our way. 
  • Start small. Keep in mind, too, that there is power in prototyping. Find ways to try things out on a smaller scale before building out a full-blown launch. You’ll get valuable feedback with less risk up front, including information that can help you make meaningful—and potentially lucrative—modifications.
  • Don’t lose hope. If things don’t go quite the way you’ve planned, don’t give up. You have already managed a level of flux most had never dared to consider, and you are here to tell the tale. You have seen that things don’t need to happen according to your playbook to turn out all right. And you have learned that, when the challenges subside, you will still be standing—more resilient than you could have fathomed. Plus, regardless of the outcome, you’ll have a good story to tell; we guarantee it. 

On that note, if it’s time to share yours, we are here to help you write it.

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