Raising Entrepreneurial Capital, 2nd Edition

11

Essentials of Risk Management

Richard B. Corbett

Introduction

The famous Murphy’s law seems to be with us in all human endeavors: “Whatever can go wrong, will go wrong.” If, however, we have a risk management plan in place, we expect to be ready for those bad things that seem bound to happen. That is the essence of risk management—being prepared for the random events that arise in the conduct of our enterprise. Those random events range from fire at a production facility to a major liability suit involving a product to a serious injury to an employee. Typical preparations for those events range from insurance to quality control to worker safety campaigns and loss prevention.

This chapter outlines the risk management process and its application ...