Risk Assessment: A Simple Approach When Making Life Goals

Which risks are you facing? How do you identify the biggest risks? How do you do a simple risk assessment and make contingency plans?

Everything has an element of risk. We might decide to act or to do nothing but both options carry risk. If we want to achieve big goals and dreams then we will certainly face risks, but these don’t necessarily need to stop us. But we do need to acknowledge and plan for the most serious risks if we want to successfully achieve our mission. Therefore identifying, assessing, and managing risk is an important part of completing our life goals.

“Great deeds are usually wrought at great risks.” – Herodotus

When risk becomes reality

The wind was so strong that the thunderous gusts were slapping the tent roof down into our faces. I lay there in the dark praying that the shelter would survive as the poles were continually flexed and bent by the invisible, but highly audible, attacker.

The camp was high on a glacier with little protection from the arctic storm. We were there to explore some of Greenland’s unscaled peaks, but at that moment no one was thinking of stepping anywhere outside the tent. We could only lie there, feeling pretty helpless.

Then, as the poles were cruelly buckled once again, I heard a shark crack, only just distinct above the noise of the storm. There was little to see in the darkness, but the tent had lost some of its shape and now some of the canvas was lying against my face. Not good.

A little preparation saves the day

It was the middle of the night. We were at least a day’s travel from any habitation, and no one was launching a rescue mission in this weather even if we could contact them. The air temperature was generally around -20 degrees Celsius or lower, but with the wind chill it could be double that. If we lost our tent we would be fully exposed to the elements and would be at serious risk of cold injury or death. With the structural integrity of the tent compromised and the storm still raging, it was a long night; me holding a prayerful vigil for our survival all the while.

Thankfully, after some hours, a pale dawn crawled in, and the winds dissipated and then ceased completely. The resulting quiet was eerie; made even more so by the snow banked up on the tent that muffled every sound. We dug ourselves out from the entrance to survey the scene. The tent had been largely buried but in our case that had been a mercy, as the snowy shroud had helped protect the sides from the gale.

After we had dug out the accommodation, I was able to examine the broken pole. The carbon fibre was splintered close to one of the connection points. I got out the emergency repair kit and looked through the few precious items we had with us. Fortunately, we had foreseen this risk and although we could not carry a complete set of spare poles, we did have a metal sleeve that could slide over the damaged section and be taped in place as a splint. It was not a pretty repair, but it worked. It was enough to ensure that the tent – and we – survived the rest of the expedition.

When to identify, assess and manage risk

One of my life goals was to make at least one first ski ascent and descent of a mountain. The expedition to Greenland saw that goal fulfilled but the whole venture was full of risk. As well as storms there were polar bears, crevasses and the chance of injury, often days travel from the nearest help. But that didn’t stop us; we just planned and acted to mitigate these risks.

As with my adventure, the risks we face to achieve our goals can be daunting. That’s why you don’t want to think about risk as the first thing when considering big life goals. If you do, the problems could easily put you off before you even start.  But, if you plan without considering the risk, you could quickly become disillusioned or make a serious mistake that could be hard to recover from.  Therefore, it is at the point when we have a clear idea of what we want to achieve, and are then considering different options to achieve that goal, that we look at risks.

That is why in The Right Questions Framework we consider risk as part of the ‘which’ question, having already thought about the ‘why’, ‘where’ and ‘what’.

Unnecessary risks can be avoided by careful planning and this process is part of your risk management process.  Your approach to risk – which risks you tolerate and those you treat – becomes your risk management strategy.

“Take calculated risks.  That is quite different from being rash.”  General George S Patton

The Right Questions Emergency Repairs and Spares Kit Tool: risk assessment and contingency planning

One way to treat risk and reduce its impact on an expedition is by carrying emergency equipment and spares. But if we were to carry too much, we would cause ourselves other problems. So, we need to limit what we take to the absolute essentials. Therefore, when it comes to The Right Questions Emergency Kit Tool, we identify and focus on the ten most critical risks.

This is how you can use this tool to identify, assess and manage the key risk that you face.

Here is a simple risk identification and assessment process. If you follow this exercise, you will be able to ascertain your key risks, analyse them, and create a basic risk management strategy:

1. Risk Identification – how to identify risks

  • Play devil’s advocate for a moment. Give yourself 5 minutes to try and think of as many things as you can that could put a stop to your venture and list all these threats.

2. Risk assessment – how to analyse likelihood and impact

  • Give each risk a likelihood score. Use a scale of 1 to 5 of how likely it is to occur (5 being the most probable).
  • Now do something similar, scoring 1 to 5 for the severity of the impact of each of the risks.  In this case, a ‘1’ might be a minor inconvenience whereas a ‘5’ would be a show-stopper.
  • For each risk multiply the probability score and the impact score. You will then get a score of 1-25 for each risk.  You can now list all the risks by rank in a table.

3. Risk mitigation and management – how to tolerate or treat the risks

  • Identify your top 10 risks for further analysis.
  • Start at the top with the biggest risks and think about how you can avoid, prevent, limit the damage, or otherwise manage the risk.  This is called mitigation or treating the risk.  Write down the plan for each risk.
  • Then, after the mitigation measures have been applied score the risk again. Do this for likelihood and impact to see how it has improved and whether it is acceptable to you.
  • Sometimes we cannot treat a risk and reduce its likelihood or impact any further. At this point, we must choose to either tolerate (accept) the individual risk or decide that we need another goal or plan.
  • Finally, consider all the risks together against achieving your goal. Decide whether the opportunities outweigh the dangers for the goal you have chosen.

Worked examples

Risk assessment example 1

For example, on an expedition, there are risks that are common but not necessarily catastrophic (high likelihood and low impact), such as poor weather. We might consider the likelihood of bad weather as being a 3 or 4, but if we mitigate the situation by taking waterproofs or warm clothing then the impact of that risk might only be a 1 or 2.

And then there are risks, which are less likely but more hazardous (low likelihood, high impact), such as an accident where someone gets injured. That is why we carry a first aid kit. Equally, as per the story I shared, a critical piece of equipment could get damaged and that is why we carry an emergency repair kit.

Risk assessment example 2

The same goes for our life goals. One dream might be to start your own business. This carries the risk of a reduced income, particularly at the beginning. So we might say the likelihood was 3 or 4. The loss of security, having given up a regular work position, depends upon our financial position. The impact for a single person with few outgoings might be low, say 2-3, but for someone with a family and mortgage, it could be significantly higher so we would likely want to treat the risk. This was the case when I started my own business.

This risk could be mitigated in various ways. The business could be initially set up as a side hustle that you do in your spare time. Perhaps you could reduce your hours and work part-time in your present role leaving time for your new business. Or you might build up some savings before leaving full-time employment to act as a financial buffer. There are lots of options but the aim is to find the right balance for you, one that allows you to minimise the risk in your particular situation while still achieving your aim.

“Decide whether or not the goal is worth the risks involved. If it is, stop worrying.” – Amelia Earhart

Don’t be paralysed by risk. Identify, assess, mitigate then get moving

There will be risk. Accidents and mistakes will happen. That is life. If we want to press forward and achieve our goals, we need to accept that. As management guru Peter Drucker points out:

“People who don’t take risks generally make about two big mistakes a year. People who do take risks generally make about two big mistakes a year.” – Peter Drucker

Using the ‘Emergency Kit Tool’ and doing a risk assessment is a helpful aid to decision-making, but remember, don’t make a decision out of fear.  Some risks will be big – you just need to know whether that danger is acceptable to achieve your aim.  We consider the risk and then we manage it.

Effective risk management helps us to achieve our mission, with the risks considered and reduced as much as possible, but not at the exclusion of risk entirely.  Remember, it is more important to do the right thing than the safest thing. Don’t let fear stop you from acting if it’s the right thing to do and the risk is acceptable. As to fear, we will talk about that some more in the next section.

If you want the right answers you have to start with the right questions

About The Right Questions

The Right Questions is for people who want greater clarity, purpose and success. There is a wealth of resources to boost your effectiveness in achieving goals, your leadership of yourself and others, and your decision-making.

Wherever you are on your journey, I hope that you find information on this site to help you on the next leg of your quest. Even if that is just the inspiration to take one small step in the right direction, then that is a success. If you can take pleasure in learning and travelling as you go, then so much the better.

Need help navigating your journey to success?

I love to serve people, helping them unlock their potential, empowering them as leaders, and assisting them in achieving their goals. Please get in touch and let me know how I can support you!

Which is the Best Course of Action?

Choices. We have so many choices. But what is the best choice? How can we make sure we are doing the right thing? Can we ensure that we are choosing the right way and the best course of action?

One of the biggest challenges of decision-making is generating, assessing, and then choosing from among the different solutions there are to any given challenge. This is why for most decisions we use heuristics – simple rules of thumb – to avoid the extra brain power needed to make decisions. In neurological terms, we save load on the pre-frontal cortex by using automatic routines saved and accessed through the limbic system.

But we can’t always do that. Often, we are faced with a new or more important decision where we cannot entirely rely on previous experience. That might be buying a car or property, changing jobs, or just working out what to do in our free time, but if the choice has a large impact on time and money then we are likely to spend longer considering our options. Working out the best course of action (or “COA” in military parlance) is therefore a critical element of effective decision-making.

Asking the right questions to improve your decision

This stage of the decision-making cycle is all about considering options. By this point, we should have already established why we want to do something, what exactly we want to achieve and where we want to end up. Considering courses of action is about choice, we use the interrogative “which” within The Right Questions Framework. In other words, we are answering the questions:

  • Which options (courses of action) are available to me?
  • Which risks and opportunities will impact my decision?
  • Which is the best course of action?

This phase can be further broken down into several steps. To help make the best choice we want to:

  1. Brainstorm multiple options
  2. Refine several courses of action
  3. Assess the courses of action
  4. Identify obstacles and risks
  5. Decide the preferred option

This can be remembered with the acronym BRAID.

Having made the decision, we then move on to the next phase of decision-making where we develop the plan (and answer the howwho and when questions). But for now, let’s examine the four steps outlined above.

YouTube Video: How do you make good decisions and choose the best course of action?

Brainstorming your options: questions that will help you

When facing an important decision, it is generally a good idea to brainstorm multiple ideas before narrowing down the options. This is an important phase as it can unearth new ways of approaching a problem and can free us from certain assumptions. If we restrict ourselves at this stage to what we think is just sensible, affordable, or realistic then we might miss out on important opportunities or insights.

For example, when I am coaching people, I often get them to answer a set of questions that explore multiple ways of looking at an issue. These might include:

  • What do you think you should do?
  • What is the logical thing to do?
  • What would someone you respect do?
  • What do you dream of doing?
  • What would you do if resources were not a problem?
  • What would make you happy?
  • What would make you sad?
  • What would you do if you could turn back the clock?

Brainstorming with a team

When I go through this process I prefer to do some thinking on my own first. I would recommend that any team starts by working as individuals first, even if for just a few minutes. This means everyone is fully engaged with the process and you avoid group-think. The team then benefits from two different levels of creativity; the personal and the team dynamic. If you start with the whole group it is likely that some of the individual ideas will be lost.

Once you have drawn some initial observations on your own you can address the challenge again in a team environment.  Other people will always bring an alternative view of a problem. So, I would recommend involving at least one other person in the thinking. Even if they just act as a sounding board of your ideas it will bring diversity to your thinking.

Lateral thought and forced association technique

You can also use lateral thinking techniques to generate ideas. One of the simplest lateral thinking techniques, and one I use when I am stuck for ideas, is the Forced Association technique. This method involves getting a set of random words or pictures and then linking them to the problem. This psychological hack forces our brain to create new neural pathways, linking otherwise associated packets of information in our neocortex. These new mental maps literally expand our minds to think of the problem in new ways and explore new solutions. If you want some help getting the random data then you can use free websites such as randomwordgenerator.com or  randomwordgenerator.com.

For example, I am trying to think of what I want to do in my summer holidays. I used randomwordgenerator.com to give me a random word and it gave me ‘morning’. By thinking of the word ‘morning’ along with the idea of ‘vacation’ my brain starts to prompt questions such as:

  • What do I like to do in the morning?
  • Where would I like to wake up in the morning?
  • What would the perfect morning look like?

I am also flooded with pictures and memories; the sun coming up over a mountain as my feet crunch through frost-crusted snow, the smell of great coffee in an Italian café, the snuggly feeling of waking up in fresh hotel linen (knowing that I don’t have an alarm forcing me to get up). Suddenly I am full of ideas of things I want to do! And that is just one word and a few seconds of thinking.

I recommend having a play with the technique, even now for something you must do today. And if you are interested in exploring more techniques, then I recommend reading Lateral Thinking by Edward de Bono.

“Sometimes the situation is only a problem because it is looked at in a certain way. Looked at in another way, the right course of action may be so obvious that the problem no longer exists.”

Edward de Bono

Generating courses of action

Once you have brainstormed a long list of potential options, the next step is to refine this list down to a few preferred courses of action. Using the heuristic of The Rule of 3 I generally recommend three courses of action which can be developed in outline and inform a decision.

You could prioritise your list from the options using your intuition and what feels like the best option.

For example your intuitive options might be:

  1. What is the most exciting option?
  2. What is the most sensible option?
  3. Which is the scariest option?

Alternatively, you might want to apply some rationale to the selection of your courses of action. One simple way to come up with three courses of action is to look at resources. You might ask:

  1. What is the option if money is no object?
  2. What is the option if time is no problem?
  3. What is the option if people and skills are no problem?

Example of 3 Generic Courses of Action for projects and tasks:

When making a business or project plan then there are some other questions we can consider to create courses of action. For example:

  1. Which course of action best fits what is most likely to happen?
  2. Which course of action represents the worst possible situation?
  3. Which course of action allows for the swiftest outcome?

Answering these questions allows three courses of action and outline plans that reflect

  1. The logical plan (most likely)
  2. The contingency plan (worst case)
  3. The fastest effect plan (which is often the riskiest or costliest)

These questions work well when dealing with a critical (time-dependent) issue, so if these questions don’t suit (for example if money rather than time was the most important factor) then you could also ask:

  1. Which is the most elegant (gold-pated) option?
  2. Which is the simplest (silver) option?
  3. Which is the cheapest (bronze) option?

Once three courses of action have been selected then the next step is to explore a simple outline plan for each. To do this we answer the questions:

  • How will we achieve the goal (what are the necessary milestones, tasks, or steps)?
  • How will this course of action be resourced?
  • When could or should each step be achieved?
  • Who can help or support each activity?

At this stage, we are not doing detailed planning so the answers to each of these can be simplified.

It is worth noting that this technique tends to favour business plans rather than personal plans. If you would like another way to prioritise your courses of action, I would recommend seeing which ones align most with your values (be that your personal values or organisational values). Using principles also helps us assess our three courses of action so we will explore that in the next section.

Assessing the courses of action using values and principles

Once we have three courses of action (with outlined plans to check their feasibility) the next stage is to assess them against each other and come up with the chosen course. As previously, you can just use your intuition to make the choice, but you may also want to apply some further logic. If you do have an initial gut feeling about which one you like, then make a note of it. Our intuition is based on our experience and preferences – so it is certainly worth considering – but it is also subject to our biases so it is worth noting to avoid subconscious bias subverting our decision-making.

My preferred way of assessing courses of action is by scoring them against a set of principles or values. To start, I will generally create a matrix, listing the courses of action on one axis and then the principle on the other. I then fill in the grid, scoring each course of action against each value out of 10. I then create a total score for each per the example below.

Principle 1 Principle 2 Principle 3 Total Score
Course of action 1 (Score 0-10)
Course of action 2
Course of action 3
Assessing Courses of Action against principles

There is no limit to the number of principles you want to employ but for simplicity, I would not recommend any more than 7-8.

The principles you choose are dependent upon the decision. You might want to use your personal values if it is a choice that most impacts you, such as a change of career. If you are making a business decision then you may want to use your organisation’s corporate values. Equally, there may be a set of specific principles you want to apply. For example, in an investment decision, you might want to employ principles from an expert such as Warren Buffet. It is worth taking a little time to make sure you have the most appropriate precepts to score your courses of action against.

Assessing courses of action with opportunity and risks

An alternative or subsequent way to assess the course of action is considering opportunity versus risk. It might be that risk was considered as one of your principles but if not then it is worth thinking about now. Identifying and assessing risk is a subject in itself but for each course of action, it should be relatively easy to identify the top 3-5 most significant risks.

These risks should then be weighed against the overall opportunity. As with risk, it might be that your chosen principles best summarise the opportunity of a given course of action. If not then consider the potential pay-off, in time, money or quality, for each course of action. Then you can weigh the risk versus the reward. For example, sometimes it is riskier to move quickly on a decision but the payoff – in terms of cumulative gain, time saved or first mover advantage – might be a risk worth taking. This is effectively a simple cost-benefit analysis of your courses of action.

Making the right choice (and better future decisions)

Finally, having assessed the courses of action you can make your choice. Depending upon which course of action scored the highest or had the best balance of risk versus opportunity, you can now commit to that option.

Having made the decision, you can then go on to more detailed planning. You will likely find that your new plans will also incorporate lessons from the other options you looked at. For example, you might well keep the worst-case or contingency plan up your sleeve just in case something goes wrong. Equally, you might have a plan that has stages that incorporate further decision points, dependent upon the balance of risk and reward. As the plans develop, you will discover that the thinking at this stage is not wasted.

Going through this process of creating and assessing courses of action has a further benefit. The formal process forces us to think deeper which will reinforce any learning points for the next decision. Recording the process, and the final choice, also allows us to go back and measure how effective our decisions were. We will not always get things right, but this reflective process will help improve overall decision-making. Decision-making is a skill like any other and for effective learning, we need to be able to reflect on what we have done.

Picking the best course of action

So, if you have options and want to make the best-informed decision follow these BRAID steps:

  1. Brainstorm multiple options (be creative)
  2. Refine courses of action (down to 3 ideally)
  3. Assess the courses of action (against principles or values)
  4. Identify obstacles (and mitigate the risks)
  5. Decide upon the best course of action (make the choice)

And one final tip, think about when you want or need to make the decision. It is easy to prevaricate, put off a decision, or miss an opportunity entirely. Setting a deadline and creating a timeline for your decision-making helps to avoid these outcomes. Depending upon the impact of the decision you might want to spend 5 minutes or 5 hours thinking through your choice, but as productivity experts will tell you, the best starting point is assigning time to make the decision, as that is a task in itself.

So, what decision do you need to make and when? If you can’t make the choice now, then take a few seconds to schedule time in your diary. And if you want some further advice on the steps to take then check out A Blueprint for Better Decision-Making.

“Opportunities multiply as they are seized.”

Sun Tzu

If you want the right answers you have to start with the right questions

About The Right Questions

The Right Questions is for people who want greater clarity, purpose and success. There is a wealth of resources to boost your effectiveness in achieving goals, your leadership of yourself and others, and your decision-making.

Wherever you are on your journey, I hope that you find information on this site to help you on the next leg of your quest. Even if that is just the inspiration to take one small step in the right direction, then that is a success. If you can take pleasure in learning and travelling as you go, then so much the better.

Need help navigating your journey to success?

I love to serve people, helping them unlock their potential, empowering them as leaders, and assisting them in achieving their goals. Please get in touch and let me know how I can support you!