Protection From Risk You Never Saw Coming
A big part of our job as risk management experts is to be able to identify risk potential that our clients would never see. While we would like to think that we have become quite good at identifying all sorts of risks, the difficult part is getting our clients to see the risk as well. The problem is that if a client does not prepare for even the most obscure kind of risk, then that opens the client up for major financial problems.
Not every form of risk that requires protection is easy to see. Our clients hire us to identify that unforeseen type of risk that can seem like nothing more than an inconvenience at first, but then blossoms into a full-blown crisis. We always encourage our clients to think of their entire operation and help us to identify risk that can come from places they would never expect it.
Many larger construction companies are accountable to stakeholders who invest in projects and expect a return. Stakeholders like to be updated regularly on the progress of each project, and they like to get an accurate accounting of how a project is progressing. But if communication breaks down with stakeholders, the end result could be that some investors pull out of a project and leave the contractor to fend for itself.
There are ways a risk management company can protect your construction business from bad stakeholder communication. While we cannot fix the communication issue, we can certainly look at the financial side and put protection in place in the event that investors start to pull out of projects. These are the types of incidents that start out small, and then grow into huge problems if they are not solved.
Your competition is causing you to lower your bid prices, scout for new places to rent equipment, and tying up your supply vendors when you do get work. You are also dealing with the competition costing your work from job owners that you have worked with before.
Competition is a risk that most construction company owners think cannot be managed, but that is not true. As professional risk management experts, we can put programs in place that will protect you if the competition starts eating into your bottom line.
Project Management Issues
Bad project management can cost you money and damage your company’s reputation. If you have a project manager who is not properly utilizing the insurance protection you have in place or not asking for new coverage when the situation presents itself, then you are creating risk that can be extremely damaging. A good risk management partner can train your project managers to be able to use existing coverage options properly, and to identify situations where new coverage would offer the right protection.
You would never expect the competition or your own project management methods to become detriments to the success of your company, but it can and does happen. Proactive construction company owners know that risk is everywhere, and that is why they hire professional risk management firms to protect against every type of situation. It is important for construction company owners to be vigilant about risk, and to make sure that their risk management partners have the information they need to protect against every contingency.