Drop the fear and take more risks: a Business approach

The Chic Geek
Aug 24, 2017 · 5 min read

Karina Korpela

I often hear people comment how brave I was to have left my native country, Brazil, so young for another, completely different country. No, not Canada, but “Thou quiet, Thou joyful” and beautiful Sweden. I had to adapt to different weather, a different language, different culture and so on. I was the dancing queen, young and sweet, only…humm, let’s skip the age part! The truth is that being brave was perhaps only 30% of it. I was fortunate to learn at a young age about taking risks, due to the nature of my career as an IT auditor that requires deep understanding of risk management.

Knowing how to assess risks and manage them helped me face my fears by having strategies in my toolbelt and, of course, multiple plans (B, C, D,…Y) for the most likely events that I was able to foresee occurring. Having a Plan B does not make you a pessimist. It means you’re a realist and see multiple sides to the different situations you face.

We are taking a risk every time we are faced with an option. Should I open my eyes and wake up today? Should I drive to work or take the bus? Should I order dessert? Should I stay, or should I go?

Not taking any risks is also a risk itself. There is the risk of missing out on big business opportunities, important life lessons, meeting new people, seeing new places, falling in love, etc. Every decision comes with risks. For the sake of this 101 on risk management universe, I will cover the one that people tend to focus and prepare for the most: negative risks.

The good news is that risks can be controlled and this is why the first step in risk management is to acknowledge the reality of a negative event occurring. Denial will not reduce the probability of a negative event happening to zero. The word “never” does not exist in the risk dictionary, and the same goes for being 100% sure something bad will happen.

Please grab a piece of paper and write down a goal you want to achieve. As an example, I will use “change careers”.

Now let’s dissect the risk, this process is called risk assessment and it is widely used by Organizations as part of an Enterprise Risk Management program (ERM).

Ask yourself the following 3 questions and write down the answers:

1 . What can happen?

Write one or two negative outcomes or events that could happen. This is your risk for this specific situation. What if I do change careers? I could be paid less since I will be starting over as a junior professional. Therefore a salary-cut could be a negative outcome, a risk for this case.

What else? I might not find anyone willing to hire me. Then I would be unemployed and, as consequence, would not have an income. Then again, salary-cut is the risk.

It’s common to identify many what-ifs for the same risk.

2. How likely is it to happen?

To make it simpler, use qualitative measurements such as: rare, unlikely, possible, likely and almost certain. And we will assign quantitative values from 1 to 5, 1 being rare and 5 being almost certain.

3. What are the consequences if it happens?

To make it simpler, use qualitative measurements such as: insignificant, minor, significant, major and severe/catastrophic.

There is no magic formula for defining consequences. Instead, set your own thresholds like in the example below:

Note that consequences do not need to be quantitative — they could be represented using qualitative measures such as: minor interruption, inconvenient, loss of life/health, significant damage, etc.

Now if we add all the previous steps related to the risk of having a salary-cut in one table we will have:

Overall rating for Salary-cut risk: 15 (average of all what-ifs)

In the business world, the results above would be plotted in a matrix that looks like this:

You too can create a table like the one above to weigh risks. It is a visual guide to help you identify where you should focus your time, money and worries. The rule of thumb is to not worry about anything in the green zone (but keep it on your radar), and address everything else in descending order of magnitude.

What can be done?

In Risk management there are four strategies for addressing risks:

  • Avoid — Change plans to circumvent the problem. For example: only quit your job once you have found a job that will pay will exactly the same or more;
  • Control/MitigateReduces impact or likelihood (or both) through intermediate steps, like working part-time at both your current and new job;
  • Accept — Take the chance of negative impact and budget for it. For example: accept that a salary-cut is inevitable and instead you change your lifestyle to accommodate your new budget;
  • Transfer risk — Outsource risk (or a portion of the risk — Share risk) to a third party or parties that can manage the outcome. An example would be to sign up for unemployment insurance.

Life can be less scary if you adhere to the tips and strategies shared above. And the more you practice it, the more it becomes second nature. Eventually you will be able to handle life’s bumps with ease, and will become a pro at prioritizing issues that require real attention, and letting go of ones that will likely resolve themselves. And who knows? You might even find yourself addicted to taking risks! Calculated risks, that is!

Want to learn more? Check out this inspiring Ted Talk:

Best Ted Talks 2015 — Understanding Risk- Take control of your life

Want to become a Risk professional? Check out the link below:

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is a Calgary-based non-profit building a supportive community for women at the intersection of technology and entrepreneurship. http://www.thechicgeek.ca

The Chic Geek

Encouraging women to be builders and creators leveraging technology to shape the world we live in.