COST - Measures taken towards Calculated Risk Taking

COST - Measures taken towards Calculated Risk Taking
(CopyRight 2009; Benjamin Goh, www.bensglobal.com)

Taking risk blindly is unthinkable! So, think about the "COST" before making any life, financial or business decisions:-

C for Calculate All Possible Risk. Consider all the risks that one will be taking before taking the next step. Calculate the risk and make sure that one can bear the cost should the venture failed or did not perform as well as expected. As in the example of driving a car. The seat belt only prevents the passenger and driver from being thrown out of the car should an accident occurs but it does not protect them if another vehicle were to completely crash the entire body of the car, thus killing them all. As such, if the driver thinks she/he is safe with the seat belt, then she/he has not actually calculated all the risk that she/he is exposed to.

O for Opportunities. Always on a look out for opportunities as most good opportunities are sought after and does not normally come knocking at our doors. So, perform the necessary background studies in all forthcoming opportunities as well as discuss this opportunities with trusted friends and loved ones who may be able to offer an objective opinion. It is critical to understand what one is going into and also to be able to see where it will lead one to in the short term, middle term and naturally, the long term. When one sought after opportunities, the comfort level would normally be more apparent.

S for Spare Cash? Once a friend and successful entrepreneur shared "Never use your own money for business as its meant to be spent on your loved ones". This is an interesting comment but putting it one step forward, let's put it as "Use your spare cash or someone else's cash for the business". As such, in taking the risk in business, one may wish to discuss with loved ones and decide if the cash to be used is spare cash and if faced with failure, it will not have any impact on the family. If so, this would imply a mental preparation of possible loss, and thus, affordable risk taking!

T for Threats. Always laid out all the possible threats that will face the decision to be made. Talk to trusted friends and loved ones about it and brainstorm for all unlikely threats that may arise. As the saying goes, "Do it Right at the Right Time and Right Place goes a long way in becoming successful"

Finally, the Chinese saying "Think Thrice before Speaking" tells about thinking 3 times over what to say before actually speaking it out. The truth lies in the fact that what is said can never be retrieved back. Similarly in risk taking, "Think Thrice before Taking-The-Risk".