A seasoned captain must constantly predict storms, plot backup routes, and guarantee the safety of the ships while navigating a turbulent sea. Similar to this, good risk management in business serves as a compass, helping us avoid dangers, navigate unclear situations, and effectively arrive at our destination.

In startups and small-scale industries, sales, revenue development, and value creation are given top priority. Undoubtedly, these elements are vital to corporate functions; yet, risk management is just as important and is often disregarded or unfelt.

Now let's examine from the perspective of small business settings, and consider risk management. Our focus will be on some of the five essential steps to risk management, rather than on standard risk management frameworks.

The initial step is to identify the potential risks associated with each line of business. While this may appear to be a simple task, it is essential to consult with each functional lead to gain a comprehensive understanding of the potential risks from their respective perspectives. Additionally, we must learn from the errors of industry experts and competitors regarding potential dangers that we have yet to encounter, as well as identify and catalog every potential danger.

The subsequent critical stage entails the categorization of risks into distinct groups that correspond to our specifications. Fundamentally, although it is imperative to address every risk, risk mitigation would invariably necessitate the expenditure of resources that may not consistently be readily accessible. In conclusion, we must classify them according to the period within which we intend to attend to them. Nonetheless, in doing so, we must determine which of the categories contain the most significant hazards and allocate resources accordingly.

The third important step is to take definitive action on the risk identified along the lines of risk management general principles. Accepting few considering the current business scenario; Avoiding as many as possible through better processes and controls; Reducing risk incidence through knowledge transfers and training: Transfer risks through outsourcing to experts or through insurance.

Implementing controls to verify and assess the measures taken in the overall risk management constitutes the fourth critical phase. This is accomplished by enlisting the services of risk management consultants or subject matter experts, who conduct a comprehensive investigation of the process and its implementation effectiveness and provide a gap analysis between the two.

Ultimately, risk management concludes with the identification of potential new threats and a reevaluation of the initial classification to determine whether it is still applicable in the current market environment, taking into account the socio economic and political climate.

As previously stated, the fact that we are a small-scale organisation does not imply that we should disregard risks simply because we have other urgent matters to attend to. However, we must take a very decisive approach to resolving the risks in the aforementioned steps and ensure that, as the ship's captain, we navigate the business through rough seas without incident.

Summary: Risk management is crucial in startups and small-scale industries, as it helps avoid dangers, navigate unclear situations, and achieve success. To effectively manage risks, startups should consult with functional leads, learn from industry experts, and categorise risks into distinct groups. This involves identifying potential risks, taking definitive action, and implementing controls. Risk management consultants can help with this process, conducting a comprehensive investigation of the process and its implementation effectiveness.