Taking the Fear out of Risk
5 Powerful Steps to Evaluate Risk
By Sheri Taber
Only those who dare to fail greatly can ever achieve greatly.
-Robert F. Kennedy
Risk poses a powerful threat for the faint of heart, yet is ever present in the quest for great success. For many, risk so quickly attracts fear that (at an ever-present subconscious level) the two feel synonymous. The risk-adverse rarely achieve greatness.
When I think of risk, I scratch my head to identify any negative connotation. Perhaps its because for everything I’ve done well and at which, succeeded greatly, Risk was an ever-present companion. I’ve established a great relationship with Risk. When she shows up, I ask her a lot of questions. I determine whether she’s here to warn me or empower me to open fortuitous doors others have failed to observe or were too fearful to traverse. Risk is a messenger. Those who befriend her refer to her as a channel of information. Those who avoid her fear her.
Fear is a “poser.” It is the charlatan of risk. It suppresses while encouraging paralysis and retreat. A common acronym for FEAR is False Evidence Appearing Real. Fear leverages erred thinking that emanates from our inability to fully perceive the potential for a positive outcome and impact in the midst of unfamiliar territory. Fear is like the shadow that startles and has no power except to incapacitate. You’ll find fear is not a gut feeling, but a head game. An interview with Risk shines the light on the shadows. The value of the opportunity she’s here to share with you becomes increasingly clear.
Understanding that if you treat Risk as an agent of information, you’ll perceive her more positively and embrace her more readily. I’ve adopted a no-fail process for evaluating, mitigating and embracing Risk and the promise of her presence.
1. Identify, characterize and assess the risks
- What is the potential value impact of the opportunity should you embark upon it?
- What is the potential loss of opportunity and value should you retreat?
- What is the worst-case scenario? (With this clearly defined, will an effective strategy detour such a scenario?)
- Identify unknown risks and associated opportunities
- Is this risk required to achieve my legacy or bigger opportunity?
2. Assess the vulnerability of critical assets to specific threats
- Time, energy, money, network and other resources
- Would these assets potentially receive a higher impact if I were to invest the same energy elsewhere?
- Define peripheral costs, loss or gain if you divert your investment?
3. Define the expected consequences of the types of risks on your specific assets
4. Identify ways to reduce potential risk and leverage gains for greater opportunity
- Research risk aversion strategies
- Identify and leverage resources to overcome obstacles
- Transfer risk to external agencies (i.e. insurance company, larger community of support, partnerships)
- Prior to embarking on your opportunity, design built in risk control processes and containment measures
5. Create a strategy to prioritize risk reduction measures
This risk evaluation process takes the fear out of risk. It will help you know whether to engage or retreat, how to reduce or mitigate risk, avoid undesired consequences and maximize your potential for success in any opportunity.
Sheri Taber is the CEO of The Peak Performance Group, Inc, a global management consulting. A 30-year industry veteran, Sheri’ is an international award-winning, business expert with the capacity to take a business and its leaders in the right direction and solve the toughest problems.