Placeholding

Understand the Risks and Mitigate Them

“Experience is a truer guide than the words of others.” | Leonardo da Vinci

There is no such thing as risk-free living, but if you follow the principles of The 1% Solution, you can reduce risk and improve your probability of success.

If you are about to embark on a certain project or a venture, list all the significant risks associated with that project. For most projects, whether it is professional or personal, there are usually about five to
10 risks in the medium-to-significant range, with only one or two being the most significant risks.

Now, prioritize the list, and for each risk write a simple statement or action on how to reduce it. Ask yourself what you can do to mitigate the probability of each risk occurring. You will quickly find that most of the risks are fairly minor to begin with, and the most significant risks can be reduced in some way. The process itself will help you determine whether it is worth pursuing the project, as often a project initially looks more daunting, only to reveal itself as more manageable when you break the risks into bite-sized pieces.

If you’re embarking on something more significant, such as a new business, this can be a fairly rigorous process and it should be worked into your business plan or your growth plan.

Nothing is risk-free, and life’s biggest rewards often go to those taking some of the biggest risks, or what seem like risks. The point of this approach is to be methodical and not to take unnecessary or reckless risks that you could have reduced with some thought and planning.

I find that many seemingly small projects go poorly when risks stack up and cause a massive failure.

As Benjamin Franklin said,
“For want of a nail the shoe was lost; for want of a shoe the horse was lost; and for want of a horse the rider was lost; being overtaken and slain by the enemy, all for want of care about a horse-shoe nail.”

Be smart—do not put yourself, your family and your capital at unnecessary risk. This process will help you evaluate whether or not you want to move forward with a project, and if you do, you will be better prepared and have a higher probability of success.

By, Eamonn Percy

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