As someone who has led over 60 climbs and expeditions to a variety of peaks including two expedition to Mt Everest, I get asked a lot of questions about risk. Risk occurs at all stages of our lives and has been defined once as an ”association with an uncertain outcome in which the possibility of significant loss or gain is present”
There are only two kinds of risks. Good risks and bad risks.
Bad risks are those when we seek a kind of satisfaction or thrill from doing something, and the thrill is the prime reason for doing so – like putting all your savings on a spin of the roulette wheel. Good risks are those where on the balance of a positive outcome, the risk is worth taking for longer term benefits – like choosing to invest in slightly riskier unit trusts, versus the low rate of return from a bank deposit
However, there are also those risks involving far more complex issues – like risking your life in a mountain climb that brings few economic benefits, but tremendous insights in self-awareness and defining your potential. Others may include leaving a secure job to take a job in a volatile business – but which brings far more professional satisfaction in the longer term
Some steps to shift your risk appetite ( backwards or forwards )
a) Ask yourself what would be the worse case scenario and the best case – your risk orientation. Then look at the ‘likely case ‘ scenario . This will help you decide to go or stop
b) Do you see more opportunities on your desired time horizon than obstacles in your proposal or venture. Don’t think too much about something – an easy step to paralysis. Are you not thinking enough? This is when you need to boost up your analytical side of your brain, instead of diving in without considering all the factors
c) What’s your ability to get around obstacles and resilience-battering events? The more your focus on skills to get you around these road-blocks, the higher your ability to get your goal, and as such, your ability to see more advantage in a particular situation – and thus raise your risk threshold
Without doubt, there is a constant illusion in our perceived safety, My view is that you need to think about expanding or narrowing your scope of risk depending on the opportunities available. Many times the worst thing to do is to do nothing at all.