For the last 25 years, I’ve done pretty well at zigging when everyone else is zagging. But let’s be clear about what I’m talking about here. I am in no way, shape or form telling you to blindly go where no one has gone before and put all you own on the line for an idea just because no one else is doing it. In fact, if no one has done something, there’s a reason for that. The reason is probably that it won’t work.
What we all need to do is consider three parts to risk management. Use this thought process in all that you do and I think you will be able to make better decisions. The first thing you need to do is to consider what the best thing that can happen is. We can all handle the best thing to happen, right? Sure, if the proposed risk went so well, you couldn’t spend time with your family or it might affect your cash flow. There might be some issues, but we can almost always handle the best thing that can happen. The second thing we need to think about is what is the worst possible thing that can happen.
Now here’s where you need to spend some time thinking about what could go wrong if you go forward. What would happen if you lost your whole investment? What would happen if this just doesn’t work? What are all the issues? Think, think, think. And then the last thing you need to do is think about is what is most likely to happen? Be conservative and realistic. Don’t listen to what your friends and family members say. They will often tell you only positive things, which is good to a degree. You need to talk with people who don’t have anything to benefit or lose by telling you that your idea won’t work. If, at the end of analyzing your idea, you can handle the best thing, the worst thing and the outcome most likely to happen, then you need to go ahead with the idea. I have used this decision-making process many times in the last year and it works.
My advice to you is simple. Look around at all the opportunities and think about delving into some of them. Use the risk management process I detailed above and take some action. If you do partake in some new endeavors, do them the best possible way you can. Right now, most entrepreneurs are retreating and that is a reason for you to consider expanding. I believe that the riskiest thing you could do right now is to not take any risks. My mentors who have done very, very well in business all have told me that they made great gains on the other side of the recessions in the 70’s and 80’s. So, I’m listening to their words of wisdom. I hope you are too.