life is a risk of some kind. The issue is not whether to take
risks, but rather how to take the right risks for the right
reasons in pursuit of the right goals or objectives.
fall into five basic categories:
The risk that can be avoided simply and completely: the
decision that does not need to be made or the gamble that
does not need to be engaged in.
The risk that is unnecessary. An unnecessary risk is when
one acts without sufficient information or without taking
time to think things through carefully.
The risk that one can afford to take. Calling on a new
prospect, following up on a lead, or exploring a new opportunity
are risks that can afford to be taken. The cost of failure
is very low, while the rewards of success can be very
The risk that one cannot afford to take. The consequences
of making a mistake would be too enormous. One cannot
afford to bet the company on a single speculation.
The risk that one cannot afford not to take. The downside
may be costly, but doing nothing is not an option.
who have achieved a high level of success are intensely
realistic. They carefully calculate every possible risk,
then think about what they would do should it occur. They
always have backup plans and options that consider all variables.
They also engage in strategic thinking. They minimize risk
and avoid being caught unprepared, by continually questioning
their assumptions and considering the effect of unanticipated
delays, cost overruns, or unexpected actions by other parties.
exercise in any situation involving uncertainty is to identify
and evaluate the worst possible outcome. Murphy's Law, “Whatever
can go wrong will go wrong,” has several secondary
laws, such as “Whatever can go wrong will go wrong
at the worst possible time,” and “Of all the
things that can go wrong, the most expensive thing will
go wrong at the worst possible time.”
identifying the worst-case scenario, engage in crisis anticipation
by assessing what can be done to offset negative factors.
One effective way to develop the ability to take intelligent
risks is to consciously and deliberately do things one fears,
one step at a time. This approach counteracts the natural
tendency to slip into one’s comfort zone. Many fears
of taking risks have no basis in reality.
Tracy is a speaker, author, and consultant (www.briantracy.com).