Personal Risk Management: An Essential Business Skill

“This feels risky! This feels risky!”

A colleague and I were joking nervously on the first day of an intense, week long training class. We were about to begin a rigorous simulation as we learned to coach teams through high-risk, conflict-ripe situations. In the release of tension through humor, we were doing some personal risk management by being honest about our feelings and our sense of the learning risk we faced.

risk

How you handle risk on a personal level has a big impact on your career or your business, especially if you are in a leadership role. In this three part series on managing risk, I’ll explore how to successfully identify and handle risk, and recovering from risk-taking that doesn’t yield the outcome you desired. In this first post, you’ll learn how to understand your risk personality.

My personal risk management style is to meet risk head on. I’m a risk taker, but I like to think most of the risks I’ve taken during my career have fallen into the “risk worth taking” category. They’ve been risks of all kinds, including:

  • Starting a career in a difficult national and local economy
  • Changing careers
  • Changing companies
  • Starting a business
  • Moving halfway across the country
  • Stopping work for a couple of years to get a master’s degree
  • Changing careers
  • Changing jobs several times in the same company
  • Starting another business
  • Adding new products and services as the market changes
Successfully handling risk and uncertainty is an essential business skill, especially as the pace of change accelerates. And yet many people run from it.run from risk For some, it’s because they see risk as an experience to be endured, not a process to be managed. Or they don’t recognize and understand risk and the business benefits of developing personal risk management skills.

Start by understanding your risk personality. Are you most likely to:

play risk sign

  • Believe that risk does not exist in your business or industry?
  • Steer clear of risk in all forms?
  • Try to understand and manage risk?
  • Seek out risk, seeing it as a challenge and an adventure in some way?
  • Love the adrenalin rush of risk so much that you create it in situations where it doesn’t have to be?

 

Remember, however you feel about risk, your competitors are trying to manage it better than you do.

And the company that handles risk most effectively has a clear advantage over more fearful and/or less adaptable competitors.

That’s because change is always underway, whatever your business or industry.

Consider these many moving parts that most companies face:

– Customers change in terms of what they want and need
– Markets move and adapt as new competitors emerge and others leave
– Technology continues to advance, and to become smaller, faster, and sometimes, less expensive
– Employees move to different jobs and companies
– Suppliers create new products and services, and enter new markets with the products and services they already sell

The net of it is that if you hate risk, and hate to change, you may become obsolete as you try to stay right where you are, attempting to preserve the status quo.warning sign

To understand how well you handle risk now, start by considering how you handled risks in the past:

1. Think of two to three major risks you faced in the past few years.

2. Did you anticipate these risks? If not, could you have anticipated them with more or different information?

3. How well did you handle each risk?

4. How could you have handled them better?

5. Are there risks you avoided? Were you able to keep them at bay, or did they show up again in a different, more vigorous or otherwise more challenging way?

Begin, also, to look ahead:

6. How would you like to improve your risk assessment and management abilities in 2013 and beyond?

7. What information might help you anticipate, understand, and manage risks better? How can you gather this information most easily?

Improvement begins with understanding and acceptance.

Knowing where you stand, currently, goes a long way toward helping you improve your risk management and other abilities.

We’ll return to the subject of risk in the next blog post. I’ll share ideas for how you can begin to handle risk better.

In the meantime, if you’d like more ideas on how to make the next year a better year, here’s a previous blog post I wrote, Seven tips to make your business change-ready for an improved year.

jan@jgrichardsresults.com' About Jan Richards

Principal of J. G. Richards Consulting, Jan helps companies improve profitability and revenue as they decrease business complexity and costs. This occurs in many ways, including: streamlining business operations; project management for major change and process improvement teams; coaching leaders of major change programs; creating long-range visions and strategic plans. A WIC Board member, Jan oversees WIC's strategic initiatives and mentoring programs.

Speak Your Mind

*

Help us fight SPAM * Time limit is exhausted. Please reload CAPTCHA.

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Follow by Email
LinkedIn
Share
Twitter
Visit Us
Follow Me
Women In Consulting Blog