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Tip of the Week
Small business owners fulfill many functions, by necessity. Small business owners are the presidents, chief executive officers, privacy officers, safety officers, sales managers and production bosses. Lately the question has been coming up, who is the chief risk officer of the business?
Here is an example: University students are ordering their boxed foods like Kraft Dinner from Amazon because it is cheaper and easier for them. As students are able to get Amazon Prime for a low annual cost, they no longer pay for shipping. Amazon delivers for “free” and their pricing is better. Small stores located close to universities used to get a lot of business from university students. Due to Amazon Prime this volume of business is reduced. Should the small local business owner have seen this coming, that an online store from the United States would be taking their local dry goods business? Would a chief risk officer have seen it coming?
Another example: I was in Toronto last week for a conference. Uber operates in Toronto and a local taxi company, Becks, has implemented the same functionality as Uber. They have an app, you can order a Beck ahead of time, pay with your card through the app, etc. They are not losing as much business to Uber, because of this app. Someone at Beck saw Uber coming and reacted accordingly. This is risk management.
What risks are facing your business due to technology or other factors? What are you doing to manage these risks?