Become part of your client’s business team as risk management partner

Leaders focused on business growth may not be thinking about the next unexpected disruption. That's where trusted advisers have an opportunity to bridge the gap.

As our country eases into the “new normal” of post-pandemic life, business leaders are getting back to what they do best — growing their businesses. We want to believe the worst is behind us, and I hope it is, despite continued supply chain challenges, market volatility and inflation. It’s safe to say business leaders are hoping this year presents an opportunity for their companies to accelerate growth and put Covid in the rear-view mirror.

Building a business requires taking risk. Business leaders spend a lot of time calculating which risks will set their company up for success now and in the future. This type of risk-reward analysis is their wheelhouse.

But if the pandemic taught us anything, it’s to consider and prepare for the unexpected. That means leaders focused solely on business growth may not be thinking about the next unexpected disruption. Additionally, many risks require specific subject matter expertise, which is better delegated to a trusted partner to assess and help manage.

That’s where trusted advisers and financial professionals have an opportunity to bridge the gap. Think of yourself as more than just the person who advises clients on financial solutions or helps them manage their investments. As you solidify your position with your clients, think of yourself as a risk management partner.

You’re uniquely positioned to help in this way. If you’re working with business owners, you’re hearing about risks they’re encountering and adverse events they’re trying to overcome that oftentimes were unforeseen. You can help raise these risks with other clients and become a true partner to their business. Where risks are outside of your expertise, leverage your network to find other trusted partners with that expertise (such as legal, insurance, accounting or technology). Sometimes clients think of those services as expenses, but you can help them see that preparation for the unexpected saves money in the long run.

ENGAGE IN RISK MANAGEMENT DISCUSSIONS

Carve out time in your next conversation to ask the business leaders you support to brainstorm risks that could derail their success. Try to avoid getting into risk mitigation or “solutioning” during this exercise. Structure the conversation around the following categories:

FINANCIAL RISK

With a potential recession looming, ask them how a stock market crash, long-term inflation or interruptions to their business’s cash flow would impact their ability to meet customer needs. Helping them consider negative financial scenarios could lead to new solutions — or at least get the ball rolling on contingency planning.

PEOPLE RISK

Nearly every business is grappling with the “Great Resignation.” How are your clients addressing the risk of losing their most important asset — their people? Are they offering the benefits, resources and incentives to attract, retain and develop the workforce they need to persevere and grow?

LIABILITY RISK

There’s no time like the present to think about how to prepare for weather events, accidents or the threat of lawsuits. Risks that were once rare, such as fires and floods, are now common in certain parts of the country.

In addition, I’m often surprised to hear about liabilities business owners have inadvertently created or overlooked because they didn’t consult with an attorney. This can happen in small ways, like failing to properly address handicapped accessibility, or on a larger scale, a company inappropriately using criteria like age, gender or ethnicity in employee decisions.

PARTNER RISK

When your clients invest in insurance or financial services solutions, they trust these providers will deliver on their promise. It’s important to consider whether key institutional partners have the track record and financial strength to weather tough times. You can help your clients by reminding them of the important of doing due diligence on partners.

TECHNOLOGY RISK

The threat of cyberattack has never been greater. This conversation may turn to a space more commonly occupied by an independent insurance agent, attorney or information technology partner. This may be another opportunity to help your clients bring in new risk management partners.

BUILDING YOUR NETWORK

Ensure you’re building your network to help clients address different kinds of risk. It may feel uncomfortable bringing another partner to the table but try not to view other risk management specialists as a threat to your relationship with your client. On the contrary, you’ll be the hero when you help your client close a gap by identifying the right partner.

At the end of the day, you want your clients to look to you as an extension of their risk management function. They already count on you to help them manage financial risk, but by engaging in proactive conversations about all kinds of risks, you can demonstrate that you’re a partner who will help them identify and address blind spots before disaster occurs.

Juan José Perez is president of Nationwide Corporate Solutions.