Business Management Skills Basic

 Business ManagementThe verb manage comes from the Italian word maneggiare which means handling (especially a horse), which is derived from the Latin word manus meaning hand. In the 17th and 18th centuries, meaning of the English word management evolved from the Old French word mesnage. “Management is the art of getting things done through people,” says management consultant Mary Parker Follett. People are perhaps the most valuable resource of a business. But there are others, like financial resources, infrastructural resources, inventory, and technology, whose optimum use is essential for effective business management.
According to Peter Drucker, “Managers give direction to their organizations, provide leadership, and decide how to use organizational resources to accomplish goals.” Management skills are classified as political (used in building power and business networking), conceptual (used in analysis of situations), diagnostic (used in taking an action in response to a situation), technical (domain knowledge), and interpersonal (people skills). Frenchman Henri Fayol describes management as a composition of five functions, namely planning, organizing, commanding, coordination, and control. Modern texts have reduced them to four, which include, planning, organizing, leading, and controlling.
Planning
Planning involves identification of your business goal and finding the way to reach it. It involves the estimation of various costs that will be incurred and evaluation of the time required to attain the business goal. A business plan has to be documented and reviewed on a regular basis. A plan is worth it if the attainment of the business goal is feasible with the allocated resources.
Organizing
It involves the assignment of tasks and allocation of resources throughout the business organization. It includes determining the primary goals of the business and strategies to reach them. It includes division of activities into tasks and assignment of the tasks to suitable and deserving employees.
Commanding
Commanding or leading is a management skill in itself. A true leader builds confidence in his followers and instills a feeling of admiration in them. He develops in them a sense of commitment towards business. A leader influences others to follow him. Understanding the need of the time, leaders need to be flexible and adaptable to change. They should help encourage the development of flexibility and adaptability in the team members.

Being innovative is important for business growth. Leaders need to be open to new ideas, they need to innovate, bring in positive change as and when needed, and progress. Progress is hardly possible without innovation. A leader should not just dream big but also provide his followers with a framework to fulfill those dreams. Innovation includes both imagination and action in accordance with it. Delegation is another important aspect of leading. It refers to allocation of tasks to the right people. It involves entrusting deserving candidates with work that they can do best.

Coordination
Coordination involves effective communication between team members and across teams. It is useful in tracking activities towards achievement of goals. Mary Parker Follett, an American social worker and management consultant, says that coordination is the “Plus value of the group”. That is, a well-coordinated group can achieve more. Coordination involves integrating and synchronizing the efforts of team members towards fulfillment of a common goal. It is crucial for taking decisions about the future lines of action.
Control
Control refers to setting standards, ensuring that the performance meets the set standards, and taking corrective action as and when necessary. Taking a corrective action needs prior analysis of the causes of performance deficit. Control is best-implemented in the form of able guidance given to employees by their manager. Evaluations are necessary to track employee and business performance.

Coordination and control are important for the success of a business. Business is ‘busy-ness’. In simple words, it refers to the act of being busy in productive work. Management is the process of measurement of the amount of work being done. It also involves assessing the quality of work and productivity. Business management skills cannot be confined to the definition of any one management theorist. The definition of management has evolved over time and the role of a business manager is no longer limited to only planning work and overseeing its execution. Considering the competition and changing market trends, a business manager needs to be a thinker and communicator. He needs to have an in-depth understanding of his business and its resources. Here, we look at these and certain other skills that make a good business manager.

Directed Thinking
Simply put, it refers to thinking towards a specific goal. The ability of directed thinking is crucial to develop a business idea as it involves logical, purposeful thinking to reach a particular goal. It is an important part of problem-solving, and can fall under both, conceptual and diagnostic business management skills.
Effectiveness
One more quality that a skilled manager should possess, is the willingness to work effectively towards the achievement of his business goal. Management guru Peter Drucker made a distinction between ‘efficient’ and ‘effective’. According to him, performing an activity swiftly and economically refers to being efficient, while doing the right thing at the right time, with efficiency, refers to effectiveness. Good business management skills lead you to the right goals. On the other hand, doing the wrong things or doing things in the wrong direction is a waste of time and resources. In other words, it’s the exercise of efficiency to no avail. A leader should know how to prioritize business activities. He should be able to understand what’s important for the business and differentiate it from what is urgent. It is important for effective business management.
Knowledge of Strengths and Opportunities
Effective business management asks for a complete knowledge of the strengths and growth opportunities a business has. Knowing the strengths requires an understanding of the availability and potential of the business resources. A complete understanding of the business and competition can help a manager understand the prospects of his business.
Knowledge of Weaknesses and Threats
As a leader, one should be able to understand the weaknesses of his organization and try to improve on them. A manager must be able to identify the threats to his business and fight them effectively. He should have the skill to endure every setback and learn from mistakes or bad decisions. Successful business development strategies used by others can help a business manager devise his own. This is where the skill to ‘experiment’ comes in the scene. Experimentation needs to be accompanied by the right judgment of actions and results.
Business management includes management of all business/organizational resources. And that includes management of money, time, and people. Proper prioritizing and scheduling of tasks for oneself and the team is an important constituent of business management. Management of money is integral to running a business. The activities of buying, selling, and pricing have to be done skillfully. Business management is not a cakewalk. It includes everything from planning, supervising, right up to being the spokesperson for your business.
People Skills
A business manager needs to possess people skills for effective management of human resources. A manager should be able to bring out the best from his team. Difficult people, those with rigid opinions and those not adaptable to change, need to be dealt with. Identification of errors followed by instructions for improvement need to come from a manager. He needs to imbibe in the minds of others that improvement is a continuous process and is essential for growth. A manager should take every opportunity to appreciate the efforts of his team members and celebrate the team’s successes. This encourages them to work to the fullest of their capacities. A manager should have the ability to keep the team’s spirits high and keep the people motivated. It’s human psychology to like getting noticed for one’s work. It’s not unnatural for one to expect recognition for his work. One of the most important business management skills is to be able to encourage your team members, extract work from them and appreciate them for it.
Approach Ability
Another managerial skill is to create and maintain an open atmosphere in the team. The team members should feel free to voice their concerns and always feel assured of their concerns being heard. There should be a proper hierarchy for communication within the organization. It is a good practice to assign relatively experienced employees as buddies for those newly-joined so that the new recruits do not feel unheard. This way, everyone in the organization has a point of contact.
Communication Skills
Communicating in a way that everyone understands is a skill a manager should have. That’s essential for teamwork and thereby for business management. In the words of Henry Ford, “Coming together is a beginning. Keeping together is progress. Working together is success.” This is what teamwork means. Developing a team spirit and maintaining it through thick and thin of a business is indeed a management skill. Keeping people together needs a manager to be a good communicator. Being able to convey one’s ideas to people, and getting good work done from them, is a skill. Communication should be effective. A business manager needs to exercise his communication skills, not just when interacting with the team, but also when communicating with external agencies; for example, during business negotiations or when addressing customer issues. That depends on your job responsibilities in the organization, but communication is an important part of a managerial role.
Foresight

It is important in business management. A business manager needs to be able to sense trouble ahead of time. He needs to be prepared for it and plan work and devise strategies accordingly. Foresightedness helps a manager assess future needs of the business and identify emerging fields for diversification.

An excellent example of a business developer with foresight, was Steve Jobs. “You can’t just ask customers what they want and then try to give that to them. By the time you get it built, they’ll want something new,” he said. He believed in anticipating customer needs in advance to be able to give them products they would start wanting.
Management is about taking the right decisions at the right time and getting them implemented by the right people. Effective business management requires a manager to have certain basic skills like the ones given above. And one very important, yet not-so-common thing he needs to have is common sense.

Creative Tips to Get Ready for Strategic Planning

Clear the Clutter to Create Your Best Strategic Plan

It’s surprising how many entrepreneurs want to close their eyes and snooze at the very thought of Strategic Planning for their Small Business. Does the thought of SWOT make you tired? Does the idea of stopping and taking stock simply have you check out?

creative Strategic Planning

The single most important step to take before tackling any short, mid or long term plan is to CLEAR THE CLUTTER. Too often as entrepreneurs, we are madly dashing forward without forward thought – and in doing so, we come face to face with the very thing that is hampering us most – OUR CLUTTER. Here are five ways to tackle clutter.

Five Tips to Clear the Clutter to Maximize Creating and Achieving Your Strategic Plan:

1. Take stock of your physical environment

If piles of paper are turning your head or corporate papers need filing or you can’t find the kid’s report cards, you are tolerating things that steal your focus. What’s in your physical environment that you think about more than twice? It’s an energy drain and is robbing you of precious time in your life and business. Find an organizational expert, read a book on organization, or simply become bolder than you thought and toss what is unneeded, file what you can or de-clutter any working area. You need a strategy to simplify your physical environment.

2. Scan your business and personal relationships

Which of your friends feels free to call you at 2:00 because she knows you work from home? Which old office mate wants a cup of coffee simply to gossip about the corporate job you just left? What are you tolerating that you are simply too nice to address directly? A relationship in your work or personal life which is not working and you fail to address it, is draining you of your life force. Screw up your courage and ask for what you want and need and find significantly more time and freedom in your day to day life.

3. Observe behavior patterns and habits

A simple habit of jumping into the computer upon waking can be detrimental to your long term success. Failure to plan meals a day ahead of time can drain you of energy when you end up scrambling. A personal phone call put ahead of a client request can derail you for hours. What behaviors or habits are you tolerating in yourself that are not useful? Unless Facebook is used to promote your business on a daily basis, let that surfing be the final reward for a day well done.

4. Listen to your Self Talk for a day

What radio station in your head clutters up your day? Could’ve, should’ve, would’ve are phrases that lead to negative self-talk. “Listen” to yourself for one day and journal what you hear. If more than half of the self talk is negative, wishful thinking or regrets, you need some active re-programming. That trash talk is cluttering up your mind, heart and spirit and the energy drain takes you completely off of your game. How do you find two positive things for every negative thought that comes up? This could be the single-most important thing you do for your business.

5. One Action at A Time

How do you eat an elephant? One bite at a time. Many of us brag about our acumen in multi-tasking. However, scientists who have studied multi-tasking observe that when performing multiple tasks, the brain has to divide up its resources to accommodate the multiple tasks and the quality of your work is compromised. You are better off making to-do lists that are categorized for the areas of your life (clients, marketing, kids, partner, bills) and then tackling one task at a time.

You may be asking, “What does this have to do with strategic planning for my business”? Good question. Strategic Planning is an intersect of heart, mind and vision. Clearing the clutter opens the heart, clears the mind and makes seeking a vision fun and exciting.

Risk Management Strategies and Tips

Risk ManagementWhen it comes to the performance of commercial and retail property today, there are factors of risk that need to be managed and controlled. Given that every property is different, the property manager or retail centre manager needs to be diligent in the process of risk assessment and management.

So what could be factors that fall into the risk management assessment process? Here are some of the main one’s for you to consider:

The expiry of any lease document and end of lease term is a threat to the income recovery for the property. Depending on the size and type of the property, income reduction can be a big issue for some landlords. On this basis it pays to monitor the lease expiry profiles within the commercial or retail investment property for the next two years. This allows you to see any threats to occupancy or income well in advance.

Outgoings for the property form part of the property cash flow and net income. Each year the outgoings for the property should be reconciled so that you understand the status and comparisons of the property to others of a similar type in the same area. It could be that the outgoings are recovered in part or in total from the tenants in occupancy. The reconciliation will form part of this assessment and recovery process. Outgoings can be a factor of risk given that they can slip out of control or escalate beyond acceptable financial boundaries.

Changes to property zoning and usage in the local area can be a factor of risk for serious consideration. If the local planning authorities change the zoning or transport infrastructure within the property precinct, your commercial or retail property can be significantly impacted. On this basis it pays to keep in touch with the planning authorities, and obtain copies of the current development plans as they apply to your area. Understand what each of the categories of your zoning provide and allow property owners and tenants to undertake on each property.

The use of each tenancy can involve risk. The tenants may undertake some form of business that involves certain risk factors. For example they could be doctors, dentists, preparation of food, preparation or storage of chemicals, excessive threat of fire, noise, or dust. On that basis it is important that each lease document covers the risk factor comprehensively and effectively. It is then up to the landlord and or the property manager to ensure that the tenant complies with the rules and regulations of the lease.

The function of each and every property will also involve risk from the aspect of property usage and the improvements installed. Through the attrition of time, improvements can degrade and even become dangerous. This will impact the landlords position of risk and on that basis needs to be managed. In older properties, it pays to get an engineering report and an architectural report on a regular basis to identify any risk factors that need to be rectified or improved.

It is common today for insurance risk assessors to inspect commercial and retail properties on a regular basis. They do this as part of the annual insurance renewal. Be prepared for this process as the assessors will be diligent in their assessment and critical in the recommendations that they make. The essential services for the building will be assessed as part of that process to ensure the safe conditions of occupancy and building usage exist.

So these are some risk management processes to consider in your building management strategy. Depending on property type, there can be others that need to be included in the list. Be aware of the process and take control of your property to ensure that nothing slips through the cracks.

7 New Ways to Use a Special Report in Your Business

If you take the time and put in the effort to create a special report, you can find ways to make that special report work for you as a marketing tool both online and offline. One special report of about 30 pages can be the start of multiple information products and Internet based marketing concepts. This article gives seven ways to use your special report as an Internet marketing tool as well as a marketing concept to use offline.

1. Create a Series of Reports: Take portions of the special report and turn it into smaller sections that can be a series of reports. If your original report was 30 pages, you can create 10 to 15 small reports by creating two to three page reports from the 30 pages of information. Be sure to include enough information in each of the smaller reports to make them informative and valuable. Develop an introduction and summary section for the separate reports.

2. Develop Internet Articles. Create a series of Internet articles to publish in article directories and on your blog or website. Open your original report as a word document. Highlight and copy a portion of one section that can serve as a stand alone article. Cut and paste this section into a new document. Now just add the information needed to make this a separate article. You can create a list article, narrative article or both from the same basic material.

3. Print it Out: Create a printed document of your online Internet special report. At 30 pages you have a document long enough to print and have spiral bound. Create a cover using a graphic or fonts and print the cover in a heavy stock paper. Take the report to a print shop and have it bound. The other option is to send to a print-on- demand provider (POD) on the Internet and have it bound and shipped directly to you or your customers. You can have the reports printed in bulk to use at your speaking engagements or other presentations.

4. Expand into a Book: Instead of going smaller go larger and expand the 30 page special report into a book. Today, books are getting shorter instead of longer. Therefore, 60 to 75 pages would make a good length for a printed book. You can use a print-on-demand (POD) service and have the book perfect bound. Create a cover and write the information for the back of the book. Remember, with a book the back cover copy and the table of contents or the two most read areas that help to sell the book.

5. Develop a Strategic Plan. A special report is large enough to use as a strategic plan for your business operations. Take a look at the current economy and see where your business fits. If the economic crisis is affecting competition, use the special report to create your SWOT analysis and write out your strengths, weaknesses, opportunities and threats to the business. Analyze how you will meet the demands of the economic crisis by making the necessary changes to respond to customer needs in the market. Use your strategic report to get more business by sharing it with larger firms that might be able to hire you to freelance because of our foresight and strategic planning abilities.

6. Create a White Paper. Turn the special report into a White Paper. A white paper is normally an industry report that tells specific information about an aspect of a business. You can always create you own white paper to highlight innovations in your business. This is good for any size company. For instance, maybe you have developed a new business system that helps virtual assistants do better project management. This is an innovation that you can describe in your white paper. Then promote the white paper as a primary marketing tool to build your business.

7. Write Your Résumé. Use the special report to write about your background, experiences, and business offers. Instead of writing a regular resume and cover letter, use creative writing skills to turn your background and experience into a story and relate it to a business problem that needs to be solved. You might not be able to share this to get a job but you could use this as an information product to promote your business, your experiences and abilities to write creatively. In these difficult economic times creativity will stand out in the crowd. You could use this to solicit business for your resume writing services, or other type of business.

These seven tips let you turn your one special report into multiple products and marketing tools for your home based business or Internet based business. With some creativity, you can put the hard work you did to write the initial information product into multiple uses without having to ever start over again.

Best Tips for Business Development

When looking to run a successful business, it’s important to know where to start, how to proceed and where one can get their breaks. When doing this, it’s easy to have a successful company in the short and long-term. While true, one should not just follow the basics, even though they are important. With that being said, here is a short guide on how to develop a business.

Simple plan: When starting out, one should write a business plan for their company. Think about it, with a plan, it’s easy to go back to it if there are any issues. For starters, one should list their overall money-making plan, assets, corporate layout and long-term plans. Furthermore, one should have a marketing plan, and the marketing plan should be pretty long as it’s the most important part of a lot of businesses. Remember, with a well-written business plan, one can do everything to get their business in order and under control. This is, simply put, the wisest start and an important step in the strategic planning for business.

Really go deep into the marketing plan: While one should write their marketing plan into their business plan, it’s wise to take it further and write a full marketing plan. Think about it, if one doesn’t have a decent marketing plan, they are going to have a hard time finding clients. To get started, one should have a decent website and a social media presence. Furthermore, one should think of their local marketing plans such as a phone book advertisement, among other things. In the end, this is one of the best tips for business development.

Find the right employees and contractors: A person who is running a company needs to hire the right people to help him or her. Without doing this, it’s hard to enjoy profits as one will struggle if they have bad employees or only hire family members. To take this further and save money, one should consider their long-term needs. Not only that, to take care of simple tasks that require some knowledge of a difficult subject, one should hire contractors. For example, when making the website or getting the accounting in order, one can do well if they hire contractors.

Define roles of everyone: It’s easy to run a company with two or three employees. Often, people will naturally take on their own roles. But, in the long run, one must define the role of every employee, contractor and owner. When doing it this way, one can avoid misunderstandings, which are sure to occur when they don’t define the roles well. Think about it, when an owner or employee doesn’t know what they need to do, it’s easy to miss important deadlines, and one can avoid this by defining roles from day one.

Financial projections: When worrying about strategic planning for business, one should think of their long-term financial projections. By doing this and looking at the long haul, one can avoid problems in the future. However, it’s not always easy to meet projections, and one must hire a professional.

In the end, with these best tips for business development, one will have a better chance at success. Remember, with a decent plan and hard work, a person will do well with his or her business idea.

Boosting Productivity With a Strategic Planning Consultant

For some, planning is one of the hardest things to do. Being able to set up a clear map of what needs to be done, how to do it, and how to move on from task to task can be difficult. But, being able to create a proper plan and execute it is crucial for businesses to run at their best. So if you struggle with making plans as a leader within your company, or you see others struggling with this skill, how do you go about learning/teaching it? With strategic planning training, a consultant will teach you all of the steps, tips, and tricks that you need know to create great ideas that will work and can help you address the following problems in the strategizing of your company.

Lack of Action – Having lack of action in any plan makes for a waste of time. The entire purpose of writing out a plan is to make sure that your business is doing what it needs to in order to reach a specific goal. Without action, there is no reaching a goal. Strategic planning training can help provide you with the tools that you need to come up with a plan that not only includes action, but also motivates it.

No Direction – Having a plan with no direction is not productive or helpful for anyone. Direction is what leads those involved to the goal of which the plan was created for. A strategic planning consultant can look at a plan and essentially write out a road map to the goal, and they can teach you how to do this as well.

No Execution – Probably the single most important part of writing any plan is the execution of it. Without execution, there is no point in getting together to write the plan in the first place. Many ideas lack the language and steps to get the plan from paper to the workplace. Strategic planning training can assist anyone in writing up ideas that are just as good on paper as they are in real life.

Lack of Resources – Plans can look really great on paper and even get started nicely in real life, but the fact is, without the proper amount of resources, no one is going to get really far. A strategic planning consultant can teach you how to come up with a plan that utilizes resources you have as well as how to coordinate to obtain more in the future should your idea require more strategizing.

And the list goes on and on. There is nothing to gain but pure benefit from strategic planning training. Being able to create and execute plans for your business is a skill that every leader needs. A strategic planning consultant can teach you how to write up a great plan and mold it into a measurable and realistic goal that will help your business grow. Getting things done in the best possible and most productive manner is a goal for every business, and proper planning skills can make this goal a reality.

Risk Management Certification Training

The purpose of earning a risk management certification is to learn how to expect and prepare for the risks than an organization is exposed to in its operations. Completing a certificate in risk management involves learning how to identify and handle possible future scenarios, and preventing any problems that might arise. Of course not all risks that can be identified ahead of time and thus the organization must also prepare general risk control processes that can assist them during any eventuality. Risk training imparts the skills and knowledge to be able to anticipate risks, and the tools necessary to be proactive in resolving them. Achieving either of the risk-related certifications and completing the related training is a fabulous way to become a permanent and contributing member of a senior management team.

This training can take any number of forms generally takes place in a classroom style or independent study style. Risk management training is an excellent opportunity for someone looking to expand their employment options or upgrade their career. Being trained how to analyze and measure risks, and how to respond to possible threats are key concepts that lead to a successful career as part of a risk oversight team. The risk management career path is a valued one, with opportunities in public and private sector and in companies of all sizes and in all fields. Obviously different aspects of risk control apply in different scenarios and in differing fields, but this is another aspect of the training process: know what to look for wherever you may be. The recognition of the importance of risk management’s place in the decision-making management level is growing, and by participating in risk training, you can open to yourself new avenues of advancement in risk analysis or policy implementation.

The training required to complete a certification is provided by the industry oversight association that the student chooses to work with. Each association and program differs in how and when they provide their curriculum. There are also many other sources of risk management training programs, from accredited colleges and universities, online, distance education courses, or night classes, but not all of these result in a tangible accreditation, degree, or certification. Of course, this type of business training is not something that you always have to embark on by yourself; some companies will endorse your academic pursuits and some even offer employee training in risk processes. Regardless of the source of the training, it generally offers reading or lecture and hands on case studies, and leads up to a certification examination. When looking for a source of risk management training it is important to know which certification or designation is, or may be, conferred upon graduation; it is also important to choose training that fits in with the rest of your lifestyle, work hours or other responsibilities. It is important to gain experience working with risk analysis tools, risk mitigation protocols, and real-life case studies to be able to transfer this academic experience into workplace know-how.

Risk management training is the first step towards a career as a risk professional. Somewhere along the way, maybe during your education, training, post-graduation, or upon completion of your training you must become certified. Completing a risk management certification is the key to unlocking the door that this training in this area provides. There are several different certifications available depending on where you live and work, and what you wish your precise role in risk supervision to be. The particular focus of the chosen certificate will guide the subjects that the training curriculum is comprised of. All of the certifications offered by the primary industry associations provide the fundamentals, but also offer the opportunity to build on that foundation with specific ‘electives’ or areas of focus. Completion of the training regimen is a great addition to an individuals existing business training and experience, and the completion of a full risk management certification will no doubt increase an individuals roles and responsibilities in the workplace.

How to Determine If Your Business Needs Risk Management Consulting

If you are running a business, one of your main jobs is to manage the risks involved in it. Regardless of the size of your company, there are bound to be some risks. If, for example, you are introducing innovations in your product, you are risking losing the investment in case customers don’t like the innovations. This goes on to show that risks are not just a part of the initial management for a business but will go on till the business exists. Therefore, if you do not have a lot of experience in managing risks, you may want to contact risk management consulting experts and companies.

These are experts who have studied the area and are familiar with different situations that may arise in a business. While they do not make decisions for you, they can help you in choosing the best options. In fact, most businesses are now hiring consulting companies in order to succeed. However, before you do this, you need to determine if you really need risk management consulting.

For one, you need to think about the nature of your business. This will determine if you will really benefit from a consultant. Is your business a general one or a technical one? Once you determine this, you carefully need to think about your needs. If your business is a general one that may be run efficiently with the help of good managers, do you really need more professionals? On the other hand, if it is technical one, you need to be sure that you are looking for advice on management and not technical issues. Remember that a risk management consultant will not advise you on technical matters but on ones revolving around the management of your business.

Secondly, you need to consider the current status of your business. Are you planning on launching a new product? Are you planning to change the pricing plan? If you are planning such changes, you will benefit by consulting a professional. However, if your business is running optimally with no major changes planned for the near future, you may not need to consult anyone. You should also consider whether you need external help. Some small business, for example, can easily manage everything by hiring efficient managers. However, if your business is a large one that could use some advice from external experts, you should go for risk management consulting experts.

How to Maintain an Effective Risk Management Program

A risk management program is a complicated but necessary initiative within organizations. However, by following a distinct process, organizations can maximize the effectiveness of their risk management program.

Identifying and Analyzing

To effectively manage risk, management must first identify the risks that pose the threat of a loss.

Risk managers use a variety of methods to collect information to identify such risks, the common of which is incident reporting, which is the reporting of any incident that is NOT consistent with the standard of care. Incident reports help identify training opportunities and weak processes within operations.

Occurrence screenings, also a common used method to identify possible exposures, are often done as apart of quality assurance initiatives.

Patient feedback, such as complaints or results from patient satisfaction surveys, is also used to identify potential loss exposures.

Past data can be very valuable in identifying risk and also addressing it, as it provides lessons learned from past mistakes or near misses. By analyzing past data, risk managers can identify the root cause of an incident that lead to a loss. Past occurrences help managers analyze the potential impact of current risks, and helps managers prioritize potential exposures.

Open communication between management and staff may be considered the most effective form of risk identification, as it can produce valuable information regarding the effectiveness of processes and any potential weaknesses within processes.

Once potential risks are identified, they must be analyzed in order to determine their significance. Risk managers must prioritize risks based on their potential for financial loss. Managers should prioritize addressing potential events that could lead to substantial losses over smaller threats that would be less costly.

Evaluate Possible Risk Management Techniques

Techniques used to manage risk can be broken down into two categories:

– Risk Control: techniques that are aimed at preventing or reducing loss

– Risk Financing: techniques used to pay for losses that occurred

Risk Control Techniques

Avoidance

Avoidance techniques are those used to eliminate the possibility of a loss entirely. If a risk that cannot be reduced exists within a particular activity, avoiding that activity would in effect avoid the risk associated with it.

Loss Prevention

Loss prevention reduces the likelihood of a potentially compensable event from occurring.

Loss prevention practices include reviewing and implementing policies and procedures and educating staff.

Example:

Educating staff about existing regulations regarding the release of a patient’s medical records or protected health information is a loss prevention technique as it reduces the possibility of an occurrence.

Loss Reduction

Loss reduction techniques are used to reduce the potential consequences of an event that has occurred.

Diligence is key in exercising reduction strategies, as damages awarded can be much lower for an organization that exemplified diligence in attempting to prevent an occurrence or following up on an occurrence that has happened (investigating the occurrence and determining its root cause).

Another example of a loss reduction technique is if a medical facility were to use fire retardant materials during construction. This would reduce total loss considerably in the event of a fire.

Segregation of Loss Exposures

Segregating loss exposures involves arranging an organization’s operations and resources in a way that if a loss occurs, its overall effect on the organization would be minimized.

Separation

A separation technique relates to the saying, “don’t keep all of your eggs in one basket”, as it involves dispersing activities and resources over multiple locations.

Example:

Facilities and vendors may store their inventory in multiple locations in the event of a fire or any other event that would damage inventory.

Medical practices may also choose to avoid contracts with vendors and purchase through multiple vendors in case a vendor were to run out of stock on an item.

Duplication

Duplication techniques are used to serve as back up in the event of a loss. Many practices keep copies of patient medical records in case of an event that damages the originals.

Duplication techniques are also used in terms of physician coverage.

Example:

It is mandatory that when chemotherapy is being administered to a patient, that a physician or mid-level is on site in case of if a patient experiences a reaction to the drug. If only one provider were available to cover, and something arose causing the provider to have to leave, then the chemotherapy treatment would NOT be able to be given or would be a violation to do so.

Contractual Transfer of Risk Control

Contractual transfer of risk control involves transferring risk from one party to another. An example of this is when a medical office leases property, thereby transferring the risk of loss or damage to the properties owner.

Risk Financing

Risk Retention

Risk retention is a technique that involves planning on how to cover losses if they were to occur.

The simplest risk retention technique is to simply pay for a loss as it occurs. This is not viable for smaller organizations, depending on the amount of the loss.

Organizations may also accrue dollars in a funded reserve which can be used to cover any future loss.

Organizations may also borrow funds to cover losses.

Physicians also carry extensive malpractice insurance policies to help cover any loss that is incurred.

Risk retention should be considered when:

• There are known risks that cannot be reduced or avoided

• A risk does not carry much potential for great loss and the organization can pay for any loss itself

• There are predictable losses

Risk Transfer

Risk transfer involves an organization transferring only the financial liabilities to another party, while still assuming the legal obligations. This is typically done by purchasing outside insurance policies.

Select a Risk Management Technique

Organizations should implement at least one risk control technique and one risk financing technique.

Selecting the most effective technique requires an organization to predict how a selected technique would affect its mission and goals (i.e. it may not be viable for a specialist to avoid risks by avoiding procedures that are necessary for that particular specialty).

The organization must also consider which technique is most cost-effective in respect to it’s operations.

Implementation

Implementation requires communication between risk management, department heads, and organizational leaders. All leadership must understand the techniques chosen to be implemented and educate staff of their importance and purpose.

Communication and education ensures that implementation of any technique is smooth, effective, and understood.

Monitor and Improve the Implemented Technique

Once a technique has been implemented, its effectiveness must be closely monitored, evaluated, and improved when needed by management. Risk management techniques can be very complex in nature, and require fine tuning when put to work.

Tips To Handle The Role Successfully

Are you one of those people who like directing large or small groups of people while the group is completing a project? Certain events in our lives make us become aware of facets of our personalities and how they come to contribute in our lives. Leaders who are effective in their jobs are the ones who are great at gathering people and getting them motivated at the same time. Leaders can also ensure that every person in the group is taking part in the project. Does this ring a bell? Is this you? If it is, then you may be the ideal person for a business management profession. Business managers are the ones in command of the group of employees under his supervision. They ensure that each person in the group is doing what he or she is assigned to do. They also make certain that everybody gets and continues to be motivated. A natural propensity to manage in relation to the traits mentioned makes the best business managers. Although one can be taught the ins and outs of business and management, only the best managers have the natural aptitude to do such work. If you discover that people long to hear your views and that they do a better job when you are participating in the work, then you could certainly have a business management career.

If you desire to become a manager in a certain industry or company, you should very well know that it is not as easy as one may think. Usually, you can’t just submit an application for the position without having any previous experience and background in the business management field. This is because a manager carries a huge responsibility and so you should ensure that you are fit for the job. In order to reach this point, you have to start from the bottom of the company. If you show how motivated you are, have the leadership qualities, and express a desire for a management position, you will probably advance to such position. If you do, then you hit your luck! Even if you exit from your present company, you do not have to exert from the bottom up again. Once you have a career experience, you can submit an application for other management-oriented jobs in other countries without any worries. In any case, if you have the proper background and great references, employers will surely believe that you are the right person for the position.

Bear in mind that not everyone is cut out for this line of work. If you are the type who doesn’t enjoy conversations with people, and you rather just be left alone with your work, then you aren’t fit to become a manager because this work entails constant interaction with people. Managers also hardly ever do the sort of work that the people they supervise do. After all, they aren’t there to help you with your tasks; their purpose is to motivate you to do your job well.