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Dealing With Risk

Bob Whipple, MBA, CPLP

I saw something in the social media a while ago, that said "Give chances: don't take them."  I propose a different slant on the topic: I replace the word "don't" with the word "and." Since I am rather risk averse, the notion of not taking chances has a comforting ring to it.  On the flip side, none of us can make progress in life without taking some kind of chances. Finding the right balance between taking calculated and strategic risks versus foolhardy ones is worthy of some analysis.

The trick is to determine the difference between smart risks and dumb ones. We need a system that helps us sort them out. Stop reading for a moment and focus on a personal risk that you have taken in the past year. Think about the process you used to sort through the risk/reward ratio and how you ultimately decided to make the plunge. In retrospect, would you do it again?  Do you thank yourself for taking intelligent risks, even if sometimes they do not pan out?

My system is to have a good strategic plan for my life.  It covers my professional as well personal life. Every year I renew the plan and refresh what I intend to do for the next year. Having a written plan allows me to turn down some tempting things without feeling guilty for missing something.

For example, this year I made a strategic decision to back off on some teaching to allow more time for product development. That meant sacrificing current income in order to have the potential for a better future. The result was not guaranteed, but the risk vs. reward tradeoff was a good one for me this year. I have also made some heavy investments in my speaking career that are already starting to pay off and are bringing me more speaking engagements on my topics of trust and leadership.

Having a plan helps me know which calculated risks might be the best moves to make. The plan is never perfect, nor do I adhere to it with shackled rigidity. I believe we need to be flexible and alert to possibilities we may not have considered. Still, operating with a backdrop of a well-considered plan has been quite useful in my life.  I recommend the practice to you, and here is a link to the system I use, called Renewal.

Giving chances, allowing ourselves and others to try things, is a formula for enabling growth. We need to feel empowered to take a chance when it is prudent and encourage others to take responsible risks as well. Sometimes we also need to give second chances in order to reap the true payoff. 

If we are too quick to pull the plug when an attempt at something goes sour, then we limit the learning experiences that come from overcoming failures. I believe we learn as much from our failures as we do from our successes, perhaps more. We need to fail more intelligently and make corrections to maximize the life lessons. It is all about learning.

For example, walking and talking are easy for most people. Recall what it is like for a child to learn to walk or talk. It is simply a series of numerous failures followed by support and more chances that allow the eventual learning to take place. But what if you had a stroke and had to learn these skills all over again? Thankfully, most of us never have to endure that agony. One person who did, and wrote insightfully about it, was Jill Bolte Taylor.

Jill wrote a wonderful book entitled, My Stroke of Insight. Here is a link to a TED Talk she gave on her experience. As a practicing brain surgeon, she suffered a massive stroke that destroyed the left side of her brain. In her book, she described the painful process to regain full control of her functions, with the dedicated help of her amazing mother. She literally had to relearn how to walk and talk while using only the right side of her brain. In the process, she discovered a kind of inner peace that is available to us all if we simply train ourselves to access it.  I recommend this book to anyone who struggles with depression. It is not only about getting a second chance, but about the amazing personal skill of modifying our own thought patterns.

Giving second chances to ourselves and others is also an empowering activity. We allow the person to take ownership of the situation and figure out how to do better in the future. With this approach, people can take a creative and uplifting road to improvement rather than dwell in defeat. 

The Connection of Risk and Trust

There is a direct link between risk and trust.  If you trust someone, it is axiomatic that that person could disappoint you. You take that risk when you trust him or her. Trust without risk is like a meal without food. If you find one, the other has to be there. For example, it is impossible to drink a glass of water without trust.

If each of us would concentrate on taking intelligent chances with the right strategy and then extend chances if things go wrong, we would find the world to be happier and more productive.

Key Points

  1. Risk is present in most actions. We often overlook the risks involved in daily life.
  2. Risk and trust are joined at the hip.
  3. Taking calculated risks is good for us.
  4. If there is no risk, there can be no progress.

Exercises for You

  1. Name five risks you took before breakfast today.
  2. Count the times a coworker or superior makes a risky decision in a single meeting. You will be amazed.  It will open your eyes.
  3. What system do you use to sort out the risks and get them lined up so you know which ones need the most attention?
  4. If you took a risk that did not work out, how can you more quickly recognize the mistake?

Dealing With Risk (.pdf 81K)

Bob Whipple, MBA, CPLP, is a consultant, trainer, speaker, and author in the areas of leadership and trust.  He is author of: Trust in Transition: Navigating Organizational ChangeThe Trust Factor: Advanced Leadership for Professionals,  Understanding E-Body Language: Building Trust Online, and Leading with Trust is Like Sailing Downwind.  Bob had many years of experience as a senior executive with a Fortune 500 Company and with non-profit organizations. Bob Whipple is currently CEO of Leadergrow, Inc., an organization dedicated to growing leaders.  For more information or to bring Bob in to speak at your next event, contact him by email, phone 585-392-7763, fill in the contact form on the Leadergrow Website, or BLOG.

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