Business plans are something a lot of entrepreneurs work on almost every day of their life. It is often a dynamic document the shelf life of which diminishes faster than one would imagine. The vagaries of the business landscape and the complex and intense nature of competition as well as forces of nature may disrupt
Business plans are something a lot of entrepreneurs work on almost every day of their life. It is often a dynamic document the shelf life of which diminishes faster than one would imagine. The vagaries of the business landscape and the complex and intense nature of competition as well as forces of nature may disrupt even the best laid plans.
A standard business plan looks at an array of business-related aspects but overlooks the significance of factors like insurance
Business risks have never been new to an entrepreneur and every business has an intuitive feel of such impacts and the extent to which they need to be looked at and planned for. The recent spate of floods in Kerala is a classic example of disruptions. No data is sufficient to prepare you to expect or pre-empt such a Black Swan event, the first-of-its-kind in a century!
So is there a point in all these planning? The answer is there is a greater need than ever before. For starters, it is becoming increasingly clear that climate change spawns challenges we need to pay heed to. While a flood of this gargantuan magnitude may not be a yearly reality, it has now become imperative to expect force majeure more frequently.
A standard business plan looks at your products and services, stresses on the financial health, a sound marketing plan, futuristic resource plan and an ambitious fundraising plan. But what we often tend to overlook, deliberately or otherwise, is significance of factors like insurance.
One may argue that we are not really an insurance economy! Personal life insurance has been hovering like an unnecessary tab on your monthly expenses, an irritating leak. Medical insurance is finding feet with the spectre of disease and disabilities looming large.
The basic parameters of environment pollution have ensured that the Indian society is facing more health risks than ever before. But these are largely the results of our behaviour which, in turn, compel us to adopt new habits often without offering choices.
For small businesses and startups also this is a moment of reckoning. In these domains also business insurance and deep thought about business risks have become matters of urgent necessity. The usual financial approach and mentality that insurance is an expense is passé. Today, you need to prepare yourself to look at insurance costs as an investment for a risk-free future. Such a mindset will help provide us a separate lens to view our business. This would cover thoughts about aspects like infrastructure, supply chain, sourcing, communication and data, among others, that we normally do not consider as our priority.
To begin with, it is a worthwhile exercise to brainstorm with your team on the possibilities of various risks and the chance of their occurrence. The contingency plans are a great enabler for you to streamline your thinking.
Deep involvement in a risk predicting process enhances our ability to do things better and more efficiently, contemplate a wide variety of things to do across fields and encourages us to seek completion of what we do rather than leaving it incomplete before the next wave of thoughts stream in.
Risk Process Engagement also does the following:
- Prepares our mind for serendipity – picking up ideas from diverse areas and keeping us receptive to interesting cross-sector insights
- Builds porous walls around ideas and helps cross-pollination of ideas
- Clears the mind and prepares it for ‘deep work’
- Helps you build a mental ‘to-do’ library
The very act of putting it down on the drawing board makes you aware and conscious, and that itself is a first step.