Stakeholder: Risk Mitigation
Reading Time - 4 min
Why you should spend 4 minutes reading this:
People can bring an end to your business, plan so they don't
Every business has internal and external stakeholders.
The difficulty and loss in income you'd experience in replacing a stakeholder gives you a rough estimation of the risk they pose to the business.
If a surgeon in your practice is truly unique and finding a replacement would take over 1 year and a loss of 1M in revenue, they carry more risk than a physician who could be replaced within 2 months and a loss of 50K in revenue.
Understand your stakeholder(s):
Mitigate your short-term risk via:
Making it harder to leave (legal agreements, asset ownership)
Having replacements ready (develop pipelines, action plans to replace stakeholders)
Mitigate your long-term risk via:
Make stakeholders replaceable (improve internal systems and processes)
Your practice/clinic will always be facing some sort of risk stemming from the three types of common risks.
Your aim should be to neutralize external/internal stakeholder risks where possible to then focus on capitalizing on providing cost-effective care.
Typically insurances, physicians and equity owners will contribute to the majority of your stakeholder risk. If you need help to understand your risk, we can help. Fill out the form below.
High-level actions you can take based on this article:
1. Map out all your stakeholders and their relevant risk
2. Eliminate/mitigate stakeholder risk that could materially damage the provider group
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