5 Simple steps to controlled risk taking

It amazes how many people refuse to pursue their goals and dreams because of the level of risk involved. They allow fear to overcome them and, when they see the effort required to achieve their goals, all they see is the high level of risk taking that is involved. In a sense, they are right; there is a high level of risk taking involved when you attempt to make changes in life. What they fail to see is that there is just as much, if not more, risk taking involved in attempting to stick with the status quo. Think about this for a minute, ‘if you are having problems in a particular area of your life, isn’t it risky to take no action and simply hope that things improve?’ In fact, this situation carries a double sided risk:

• You could remain unhappy as things fail to improve.
• By failing to make any changes, you miss out on the many opportunities that positive  change can bring.

If you wish to make changes in your life, there will certainly be some risk involved but you must remember that not all risk is negative. There's reckless risk taking.  That's the type of things that those without self discipline do and it usually leads to disappointment and failure.  Then there's the type of risk taking that people with self discipline take.  This type of risk is more measured and considered. You identify the controls that you can put in place to reduce the risk involved and, you are prepared, if things go wrong, to identify the lessons from your mistakes. When you take controlled risk, you understand that mistakes are an opportunity for learning; affording you the opportunity to turn a short-term negative into a long-term gain. This approach brings huge rewards and makes the most out of opportunities.

Simple steps to controlled risk taking

The following steps will help you to reduce the risk involved when you decide to make changes in your life. By implementing these steps, you will have a greater chance of success at the first attempt. Should you be unsuccessful with your initial attempt, it will be easier for you to identify the corrections you need to make in order to be successful with your next attempt.

1. Look before you leap

If you never take a risk, you will never make a gain worth making. That is certainly true but it doesn’t mean that you have to be an idiot who jumps blindly into everything.  You must still avoid being too impulsive and forgetting to use your head. While over thinking things to the point of paralysis (often called the paralysis of analysis) is a big mistake; so is jumping blindly into the unknown.

You will never be able to predict everything that lies ahead of you but you certainly can consider all known possibilities. Before you leap, take a look at the possible outcomes that lie ahead. Consider the risks that lie ahead and identify any reasonable action you can take which will reduce the chances of failure. Once you have implemented these actions, you will be in a much stronger position to move forward.

2. Rehearse

Preparation is a massive part of success. When you prepare, you build your confidence, improve your skills and, give yourself the opportunity to identify areas where corrections are necessary. If your risk involves a physical skill, you can create a very realistic rehearsal e.g. practicing a presentation.  If the risk is more mental, you can use imagery to run through the situation.

Rehearsal is a fantastic opportunity to go over your strategy and consider what obstacles you could face.  When you discover potential obstacles, you can write them down and brainstorm potential solutions. When you think you have identified potential solutions, you can rehearse again to assess whether they are realistic or not.  It's not possible to be ready for everything, but you can be ready for most things.

3. Consult a mentor

Experience is a great teacher, maybe the greatest.  However, risk often arises due to a lack of experience. Many people give up or get anxious at this point but there are other ways to learn from experience. You need to understand that the experience does not have to be yours in order for you to learn from it.

If you can find a mentor who has the necessary experience, it provides a great opportunity for your learning and development. Preferably, you want to be able to have a two way conversation with your mentor. If this is not possible, you can research the internet to find many great mentors via blogs, books, videos, courses etc. You may not be able to ask them questions but you can certainly learn from their experience.  You just need to remain humble, accept you don't know everything and seek to learn from others. This form of learning is easy to implement and greatly reduces your exposure to risk.

4. Prioritise your risks

With time management, we always hammer home the need to focus on importance. The same is true for risk taking. Risk taking is only worthwhile if the desired end result is important. Taking risks for little or no reward will often endanger something important or lead to bigger problems.

Knowing how to keep your priorities in order is an essential component of self discipline.  Your top priorities must always get the most focus and energy applied to them. Reserve your risk taking for your most important goals and objectives and, do not endanger your key priorities by taking risks for things that simply are not important.

5. One risk at a time

The best way to achieve large goals is to break them down into smaller goals whereby you can complete one small task at a time. Risk taking is best done with the same approach. Break your goal/change into small steps. Then, when you take one step at a time, you are taking much smaller risks. If it doesn’t work out, you experience smaller problems which are easier to identify and solve.

Another step by step approach is to diversify the risk. This is most common in financial management. Rather than place all of your money in one investment, you would make a number of investments, each having a percentage of your finances allocated to them. This way, if one investment goes wrong, you do not lose everything. The risk taking is limited to the money you have placed in that specific investment. Most investors suggest never going beyond 20% in a single investment.  This is great advice to keep in mind for the rest of your life too.

If you avoid risk taking, you will never see the large gains you desire in your life. Your potential for success will be severely limited. Taking reckless risks is also a destructive path but risk taking is essential. Success in life, whatever you pursue, is dependent on steady growth rather than sudden, dramatic results. The best way to achieve this is through effective goal setting and controlled risk taking. Of course, controlled risk taking does not eliminate the possibility of experiencing loss; it merely reduces it. In addition, it reduces the size of any potential loss.  The steps above will enable you to implement controlled risk taking in your life and move a little bit closer to the life you desire.