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March 1, 2017

Top Risks Facing Businesses in 2017 (article)

Cyber attacks, advancing technology and a new White House administration are just a few risk areas that business executives should consider when planning for 2017. Reducing your company’s exposure is essential to protecting your business, but it can be difficult if you are overlooking your potential areas of vulnerability.

Cyber Attacks

As critical operations, client and employee information and intellectual property continue to migrate to digital formats, businesses increase their potential to fall victim to a cyber attack. Although many organizations have been working to implement cybersecurity programs, studies conducted by McKinsey and the World Economic Forum have found that companies are still continuing to struggle with their capability of handling cyber risk.

In 2017, businesses can expect cyber attacks to continue to evolve. Recently, hackers have gained access to companies through the purchase of username and password information from previous breaches. Virtual reality is also being used to create new tools for cyber attacks. The complexity and speed of ever-changing attack methods make it difficult for companies to manage their cyber risk. The best defense for businesses will be to evaluate their current assets and operations and focus on implementing strategies to protect their primary ones. Planning for an attack to occur and training all employees on your remediation strategy will also benefit your company. Health care and health insurance organizations should be especially diligent in this process, as they will likely continue to be a primary target this year.

Rapid Technology Changes

Investing in new technology can help create efficiencies in your daily operations and limit your company’s spend in other areas like personnel, facilities and travel. Transitioning to mobile devices or software platforms has changed the way the businesses interact with their customers and employees, and keeping up with rapidly changing technology is required to remain competitive and profitable. Failing to adjust to these changes in technology or customer preferences or implementing technology that doesn’t work properly can cause disruptions or financial consequences.

The best preparation that businesses can take when adapting to rapid changes in technology is to clearly communicate any changes or updates to both internal and external stakeholders. Your employees and customers will likely want to know what transitions will take place and how it will directly affect them. Begin training any users in low pressure environments and continue to train even after new systems or software products have been implemented. Keep in mind there are bound to be obstacles along the way so creating one or two contingency plans ensures that you can continue to operate if something goes wrong.

Talent Management

While executives invest in strategies to recruit talented new employees, companies often fail to properly invest in developing their existing staff. Focusing efforts on talent attraction without placing an equal emphasis on talent retention will create problems for many businesses in 2017. A recent study by Glassdoor indicated that employees under the age of 45 feel especially confident in their value, with more than half of participants believing they could find another job that matches their experience and current compensation within six months.

Although businesses can implement a wide variety of programs to help develop and retain their top talent, the key will be for executives to marry their recruitment and retention strategies. Those tasked with attracting new talent should work with hiring managers to make sure new employees are properly transitioned into the workforce. Once employees are engaged, business leaders can consider providing professional development, continuing education, or flexible scheduling opportunities to keep employees excited about their role within the company.

Trump Administration

2017 marks the first year of the Trump Administration. With a new president and Republicans controlling both chambers of Congress, it is more likely that changes could be coming to taxes, trade and other regulations. Change may bring opportunities, but it is also likely to bring risks and could have other effects on your operations. Businesses will need to monitor regulatory updates carefully and be prepared to adjust their strategies to meet their new requirements. 

A Proactive Approach is Key

Consideration of all your risks should be part of an ongoing risk management process. Your risk environment is always in a state of flux. Only by periodically reviewing your areas of exposure can you keep up with those changes. For information on how you can set up a comprehensive risk management strategy, please contact us.

Copyright © 2017, CBIZ, Inc. All rights reserved. Contents of this publication may not be reproduced without the express written consent of CBIZ. This publication is distributed with the understanding that CBIZ is not rendering legal, accounting or other professional advice. The reader is advised to contact a tax professional prior to taking any action based upon this information. CBIZ assumes no liability whatsoever in connection with the use of this information and assumes no obligation to inform the reader of any changes in tax laws or other factors that could affect the information contained herein.

CBIZ MHM is the brand name for CBIZ MHM, LLC, a national professional services company providing tax, financial advisory and consulting services to individuals, tax-exempt organizations and a wide range of publicly-traded and privately-held companies. CBIZ MHM, LLC is a fully owned subsidiary of CBIZ, Inc. (NYSE: CBZ).

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