Are You Taking More Risk Than You Think?

Every business comes with risks. That's just part of the deal. Whether you'd call yourself a "risk taker" or not really comes down to your risk appetite: how much uncertainty you're comfortable living with in exchange for running and growing your business.

Here's the catch, though. Most business owners have a pretty good sense of how much risk they're willing to take. What they don't always know is how much risk they're actually taking. And those two numbers can be miles apart. That's where I come in. As a risk management specialist, I look at the internal controls your business has (and the ones it doesn't) to figure out whether your real-world risk lines up with the level of risk you're comfortable with.

"But I Trust My People"

I've worked with thousands of small business owners over my career, and I can tell you the most common risk I see isn't some complicated financial scheme. It's trust. Don't get me wrong, trusting your team is a good thing. But trust isn't a control.

Here's a story I've seen play out more times than I can count. Meet "Jane." Jane has been with the company for years. She's the bookkeeper, the office manager, and practically part of the family. She writes the checks, and at the end of every month she reconciles the bank accounts too. Everybody loves Jane.

And Jane has been quietly taking thousands of dollars from the business.

Nobody caught it, because the only person checking Jane's work was Jane. When one person can both move money and review the records of where that money went, it's incredibly easy to hide things. In the risk world, we call the fix separation of duties, and it's one of the simplest, most effective safeguards out there.

It's Not Just Small Businesses

Bigger companies aren't immune either. I've watched mid-size businesses lose nearly everything because they didn't have solid controls around company credit cards. No spending limits, no clear policy on what's allowed, no one reviewing statements, receipts optional. A few cards floating around with no oversight can turn into a very expensive problem very fast.

The Good News: The Fix Is Usually Simple

Most of these disasters could have been avoided with just a few basic processes. For example:

• Split up the money jobs. The person who writes checks or pays bills shouldn't be the same person who reconciles the accounts.

• Look at your own bank statements. Even a quick monthly glance by the owner goes a long way, and people behave differently when they know someone's watching.

• Set a credit card policy. Put limits on each card, require receipts, and have someone other than the cardholder review the charges every month.

• Require a second approval for payments over a certain dollar amount.

• Have people take vacation. Seriously. Schemes like Jane's often fall apart when someone else has to cover the job for a week or two.

• Get an outside set of eyes on your books every so often.

None of this means you don't trust your team. It just means you're protecting them, your business, and everything you've worked so hard to build. Because when a business takes a big hit, it's rarely just the business that suffers. It can put your personal wealth and well-being on the line too.

Let's Find Out Where You Stand

If you're a business owner and you want to make sure the risks you're taking actually match your risk appetite, let's talk. I'll help you spot the gaps and put simple, practical controls in place before they turn into costly lessons.