Business is full of risk and yes, I CAN live with it. In fact, having a risk management approach to your business can be hugely beneficial. Once you have identified the risk and calculated the amount of risk, you can either assume or avoid the risk. If you assume the risk, then it is imperative to navigate or manage that risk.
Most businesses manage a variety of risks usually around customer, vendor, market or government. Lately that has expanded to include environmental and social media risk. It turns out that beyond being excellent tools for improving efficiency and enabling remote work, document management and workflow are risk management tools as well. Here are some thoughts on how the two work together and how these tools will help you Identify, Calculate, Assume and Navigate the risks to your benefit.
Here’s a simple example of how document management is a risk management tool. If you don’t have the customer contracts, how do you know you are collecting the correct revenue? (Calculate). When you go through the process of collecting your customer contracts and migrating the files into your document management system, you will discover the customers where you don’t have a contract (Identify).
Using those same customer contracts, here is an example of a workflow that perfectly illustrates risk management. Once you have your archive of existing customer contracts, create a workflow to approve and capture all new contracts (Assume). Route the executed contract through a process that ultimately alerts all relevant departments and ends with confirming the billing system entries and recording the expiration date. Now you have reduced your billing risk and managed your customer contract expiration risk (Navigate).
Here’s another one. Create a workflow to review your monthly or quarterly investor reports before they are delivered to manage several risks from financial to media. Don’t let reports go out that have errors that will undermine valuable repeat investors. Don’t let reports go out that have mistakes that will find their way into the media. But most of all, eliminate compliance risk by ensuring you have a documented and auditable review process and unaltered and archived final report.
Smart contracts on the blockchain can achieve some of this dual benefit of risk mitigation and efficiency but that might work best with basic contracts. For non-standard or complex contracts, workflows and document management will be a giant leap ahead compared to approval via email and files saved in folders on the network. Start thinking about your business in terms of managing risks and you will see how document management and workflow elevate as both an efficiency tool and risk management tool. I CAN live with risk and in fact your business can be better for it.