Life is risk. Business is risk.
A successful life and business is calmly considering the risks you may encounter in your life and business.
For a new General Manager, the fear of the potential for failure often outweighs the benefits of taking well considered risks.
And as a risk taker myself, I can see that a more measured approach to assessing risk in your business life is worthwhile. So how can I do it? First think of what you consider a risky decision you need to make, and then find a piece of paper.
Obviously, to make such a decision, there must be a raft of positive reasons to take the risk, otherwise why consider it. But the purpose here is not to balance the positive and negative, doing that just means there are more good reasons than bad to do something, and one of the bad reasons could be catastrophic. What we aim to do is to find a way to understand what’s the level of manageable risk involved in this decision.
1. Fold the piece of paper into three columns.
2. In the first column, write down all of the things that could go wrong should your attempt fail. Think of the most terrible things possible.
3. In the second column, determine ways that you can mitigate (reduce, diminish, off set) the possibility of each of those bad consequences from happening.
4. In the third column, think of how you would recover from each of the scenarios you imagined and wrote in the first column.
The power in this approach is that it does not ignore the negative risk that a decision may have. It recognizes the risk and then it does something powerful, it puts it into perspective with ways in which you can manage the risk and recover.
Life and business is about taking risks, and being able to manage and recover the negative impacts of those. Avoiding all risk means ignoring most opportunities, too.