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Top tips to manage risk effectively

There is a perception that risk management is yet anotheradmin or compliance ‘box ticking’ exercise. However, the reality is that riskmanagement failures can have a massive impact on your business.

The following risk management tips generally amount to basicgood practice. There is no earth shattering magic formula for avoiding risk andthe reality is that most negligence claims arise out of a failure to followsuch good practice. It’s therefore worth emphasising the areas to focus on:

Understand the needs and requirements of your clients

This should include setting out precisely what work you areto carry out. If there are other professionals involved it is important toclarify how roles and responsibilities are divided up.

Contracts are key

Make sure that you have appropriate contractual arrangementsin place. If necessary, seek independent legal guidance.

Avoid scope creep

If a piece of work/project you are engaged in is evolving(often referred to as scope creep) make sure that there are effective changecontrols in place.

Stick to what you know

Only provide services which fall within your scope of yourexpertise. Don’t start straying into areas which should be the domain of otherexperts as it can easily lead to errors.

Manage expectations

If a piece of work/project is going to take longer or costmore than originally anticipated make sure that the client is aware of this andaccepts the position.

Keep thorough records

Keep full records of key conversations, meetings andexchanges with clients and other interested parties. This is invaluable ifthere is ever a dispute. Many claims could be avoided if there was a completepaper trail.

Get the right insurance

Make sure that your professional indemnitypolicy is adequate for your needs. Is the policy limit sufficient for thesize and value of contracts you are entering into? Are there territorial limitson the policy? Has the type of work you are carrying out been clearly explainedto your insurers?

Don’t let IT be your downfall

Have adequate systems and controls in place to protect thedata you hold from both loss and theft. Specifically make sure that data youhold in relation to clients or projects is properly protected using passwordsand encryption. As you will have heard in the press, cyber crime is escalatingto unprecedented levels and it is important to make sure your risks areminimised.

Seek expert advice and guidance

Drawing upon our years of experience in dealing withprofessional firms, we can offer specific and tailored advice on any aspect ofyour risk management. From simple administrative improvements, risk seminars toyour staff, or a more detailed and complex audit of your operations andprocesses, our riskmanagement experts are on hand to guide you through the process.

For more information, please call us on 0117 929 3344, or email enquiry.professions@bluefingroup.co.uk

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