Little snippets

Something I received in email today from one of subscriptions:

To bet or not to bet? Take a rational approach to riskLeaders are responsible for strategy and plans-and managing the risks involved in carrying them out. Here are some techniques for minimizing your exposure:

• Examine the assumptions in your plan. Ask basic questions to pinpoint the foundations of your strategies, and decide which of your assumptions are built on information that's incorrect or that could change. For instance, the cost of goods that you have calculated in your plan could go up, which could change the amount of profit you project.

• Look for warning signs. Identify potential obstacles to a successful outcome. Have other organizations failed at similar projects? Are you assuming that conditions won't change, or that a competitor won't strike back? Question your assumptions again to be sure you haven't overlooked anything.

• Take preventative action. Look for ways to reduce your vulnerability. You can't plan for every possible contingency, but you can prepare for the most likely problems.

• Set up a hedge strategy. Split your bet to minimize the gamble and maximize your chances of success. For instance, can you develop two new products to test instead of one? Don't stretch yourself (and your team) too thin, but look for ways to improve your odds by sharing resources as well as risk.