This approach is centered on three activities: (1) identify possible adverse events, (2) assess the probability of each event, and (3) rate each event’s potential severity. To guide these conversations, we recommend that you follow a simple, effective framework to share with your clients so they can rethink any dangerous assumptions and take the steps necessary to position their business to prepare for and then survive and thrive following a catastrophic event, such as fire or water damage, hurricanes, tornados or other unexpected occurrences. Identifying flawed assumptions and replacing them with more realistic ones is the first step towards improving your clients’ readiness for catastrophic events. Recognizing and then rethinking those possibly flawed assumptions should be a major goal of these conversations. For instance, not having any plan for a particular catastrophic event implies the assumption has been made (consciously or unconsciously) that the event is unlikely to occur, or if it does, that it will have a relatively minor impact on the business. Whether your clients know it or not, they may have already made assumptions about their ability to avoid and to recover from a disaster. Contingency, i.e., plan for continuity of the business despite the catastrophic event,.Mitigation, i.e., take actions that reduce the likelihood and/or the severity of the event’s impact,.There are multiple strategies, but the most common are: Your client’s answers to the above questions will help to dictate which risk management strategy would best suit their business.
Of course, while experience is an invaluable guide to help plan for a potential future event, novel events may still occur creating new challenges to full recovery.
The conversation must begin by challenging your client’s existing assumptions about the risks their business might face from catastrophic events, which may be flawed or out-of-date. Your clients will then be able to take the steps needed to better prepare their business to survive a disastrous event and thrive after recovering from it. We will arm you with a simple approach to help your clients self-identify flawed assumptions about disaster planning and replace them with sound ones. This second article in our Trusted Advisor series offers you information to facilitate the conversations with your client to provide an awareness of their need to prepare for potential disasters. The outcome of that “moment-of-truth conversation” can be greatly influenced by how well your client was prepared for the catastrophe they just experienced. For a Trusted Advisor, this conversation represents a “moment-of-truth” in the relationship with your client. How to help your commercial property owner and business clients avoid dangerous assumptions about the “risks” facing their business.Īs discussed in the first article of our series, Trusted Advisors such as attorneys, accountants, and financial advisors are truly “worth their weight in gold.” When one of your clients suffers a potentially life-changing natural disaster that affects their business and needs advice, it is likely they will turn to you.
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