Article review of Risk Management Techniques
In part one, Alan Siegei focuses on risk management techniques as per a profitable endeavor. He talks about risk management practices that can reduce one’s exposure to adverse economic, business and legal consequences that if are not taken care of may lead lose of money. He identifies persons to whom one may have legal or financial exposure. He also talks about some client-related situations that could expose one to financial and legal chaos.
In part two, he talks exclusively about the customer being a potential claimant. Alan talks about suggestion for how to address the client-related situations. Among the suggestions he asserts are, not picking the wrong client to work for; educating the client on what to expect during the project and not increasing the standard care you owe to the customer.
Summary of the article
Risk management techniques as per a profitable endeavor
Making profit does not just involve the normal methods like, charging appropriate fees, collecting your fees and controlling your ordinary expenses, but also involves exercising good risk management techniques. This good risk management should extend beyond having an appropriate insurance. Besides having, an appropriate insurance, good risk management consists of operating your interior design business through a firm enjoying “limited liability.” This article focus on analyzing risk management techniques that can reduce ones exposure to loses.
Before exercising good risk management techniques, there is need to determine those persons or firm whom one may have legal or financial exposure and the risk associated with them.
Your client as your potential claimant
The relationship between the designers and their clients may end if the designer does not meet the client’s need. This brings about client-related situations that might expose the designer to potential and economic chaos. Below are suggestions for how to address one of the risks.
Risk: The clients expect perfection in the performance of a designer.
Some clients always need their work done with perfection of which is not always a realistic expectation. Therefore, the designers need to take the following risk management techniques to counteract this risk
a. The designer should not pick on the wrong client to work for
The designer should not be faster in taking any project that comes their way without knowing the personalities of the clients. The designer should always define the client’s personality before making an agreement with him. As the client interviews the designers, they also need to interview the client in turn.
b. The designer should inform the client of what to expect during the project – both the good and the bad
The designer should remind their client that problems develop on projects and that they definitely will. They must let the client know that they will always be there to fix any problem that arises. They should then let their action convince the client.
c. The designers should not increase the level of expectation they owe the customer.
The clients always subject their designers to agreements of level of care. If the designer agrees to perform to the highest level, the client will not always expect the level of their services to fall. The client treats a slightest fall as a failure hence the designer held accountable for the damages the client may have sustained. By agreeing to the client’s request that you perform at the highest standards, the designer will be raising the legal threshold that he will account for.
