A healthy attitude toward risk is important

"Oh, you’re just being negative.”

Imagine this. You’re working in information technology in the year 2000, the midst of the telecommunications boom. While reviewing project risk items — uncertain events with a potential impact — your chief operating officer utters this statement.

But you’re not "just being negative.” You’re talking about risk, and sometimes it’s one of the hardest messages to deliver. Regardless of a project’s scope or size, risk must be addressed. Oftentimes, business stakeholders, like the COO, do not want to hear about what "might” go wrong.

It’s now easy to see how symbolic that statement was of the time and market conditions. Business was "booming” and the expectation was clear: get moving on everything at once. You were not rewarded for playing safe. You were rewarded for being a thought leader, making bold moves and taking risks.

The result: a knockout punch to the face. If only the COO and other company leaders had guarded the corporate chin a little, the particular company in this real-life scenario might still be here today. But because they lacked a healthy attitude towards risk, the stage was set for failure.

Clearly, business cycles are results of the economic philosophy of the age. Businesses become more or less risk averse depending on how they are doing at the moment. When bad things are happening to initiatives, the risk attitude is often out of sync with the cycle in which we are living and working.

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