All of life is a risk of some kind. Whenever you engage in any action where the outcome is uncertain, for any reason, you are taking a risk. You take a small risk when you drive to work or walk across the street. You take a larger risk when you start a business or invest a sum of money. You take a risk whenever you venture into the unknown, where your possibilities and probabilities cannot be determined to an exact degree. From the time you get up in the morning until you go to bed at night, and even when you are sleeping, you are facing risk to some degree.

The issue, then, is not whether or not you take risks. The issue is how skillful you are and, therefore, how confident you are in taking the right risks for the right reasons in pursuit of the right goals or objectives.

There are basically five types of risk for you to consider.

• The first type is the simplest. It is the risk that is not yours to take. It is the decision that you do not have to make or the gamble that you do not have to engage in.
• The second type of risk is the risk that is unnecessary. You engage in an unnecessary risk when you act without sufficient information or without taking time to think it through carefully in advance.
• The third type of risk is the risk that you can afford to take. Calling on a new prospect, following up on a lead, and exploring a new opportunity all are risks that you can afford to take. In these cases, the cost of failure is very low, while the rewards of success can be very great.
• The fourth type of risk is the risk that you cannot afford to take. The consequences of making a mistake would be too enormous. You cannot afford to bet your whole company or your whole bankroll on a single speculation.
• The fifth type of risk is the risk that you can’t afford not to take. The down side may be costly, but the up side is so exciting that it is very much worth taking a chance to go after it.

Men and women who have achieved a high level of success are intensely realistic. They do not put their trust in luck. They carefully calculate every possible risk, and then think about what they would do should it occur. They always have a backup plan in case things do not go as they wish them to. They have a “Plan B” and options to that plan that take all kinds of variables into consideration.

Successful individuals engage in strategic thinking. They minimize risk by continually questioning their assumptions and asking themselves what they would do in the case of unanticipated delays, cost overruns or unexpected actions by their competitors. They are seldom caught unprepared because they have thought through the kind of uncertainties that create unacceptable risks—risks they cannot afford to take.

THe conclusion of this article will be published on Friday March 25, 2010. Brian will share several ideas on how to get the most out of the risks you take.

About the author:
Brian Tracy is a legendary in the fields of management, leadership, and sales. He has produced more than 300 audio/video programs and has written 28 books, including his just-released books “Create Your Own Future” and “Goals!” He can be reached at (858) 481-2977 or www.briantracy.com.