Douglas L. Hubbard is the author of four books on the subject of risk management. Two of his books are on the required exam preparation reading list for the Society of Actuaries. In a presentation “How to Measure Anything” Hubbard threw up a slide titled Critical Decisions & Measurements. He asked three questions of the audience:
- What is your single biggest risk?
- What is your most important decision?
- What is your most important performance metric?
In the current economy there is less room for error. Managing risk is at a premium. Making good decisions is essential.
According to Hubbard the answers to the three questions should be the same for any business owner. It does not matter who the owner is, the type of business or the structure of the business. With this in mind here are Hubbard’s answers.
- Question – What is your biggest risk? Answer – The biggest risk is a flawed risk assessment and decision analysis. It is important to note the answer is not bankruptcy or death. Those are results of a flawed risk assessment.
- Question – What is your most important decision? Answer – How you make decisions. If you decide ahead of time how you are going to make a decision you are in a much improved position to make a better decision.
- Question – What is your most important performance metric? Answer – Your own performance as a decision maker.
These are simple observations yet bordering on profound. There are four critical financial protection planning areas for business owners; Succession, Retirement, Estate and Key Employee Planning. At Marshall+Viliesis we give you the business owner a better foundation for making protection planning decisions paying close attention to how Douglas Hubbard frames the subject.
We follow Three Principles as a foundation for business owner planning. The first is Process. Our process allows business owners to be better decision makers in each of the four planning areas and this leads to better outcomes and saves time. How you make decisions is your most important decision.
If you want to learn more about our approach to business owner protection planning we want to have a conversation with you. Your business is your most important asset.