By Neil Patrick
My Dad was a caveman.
Not literally of course, but he thought like one. I’m not saying that he was stupid. Just that he had extreme risk aversion. And this characteristic dominated his outlook on everything.
It meant that he avoided almost anything that involved taking any personal risk. And over time, this escalated from simple risk aversion to chronic indecisiveness and procrastination.
His career only survived because for his generation, the world changed slowly AND he was in a very secure type of work (he was a college teacher). So he kept his job for decades and even prospered a little without having to take many real risks at all.
Why our brains trick us about risk
Over the weekend, I read a post on Tim Ferris’ blog, by Ben Casnocha an award-winning author and serial company-builder and Reid Hoffman, Co-founder and Executive Chairman of LinkedIn. Their piece was about how our brains react to the perception of risk and the effect this has on our career decisions.
Almost everything has changed since my father retired in the 1980’s. From big things like communications and the geo-political power map, to everyday things like how we buy things and how we network.
But for a moment, let’s roll the clock back to 15,000 years ago
You are out hunting for your lunch. There’s a rustling in the undergrowth around you. If it’s a hungry bear, you’re quite possibly going to die. If you retreat to avoid the risk, you’re almost certainly not going to starve.
You’ll probably find food easily elsewhere without the need to risk being eaten yourself.
This redundant logic is hard-wired into our brains: It’s more dangerous to miss the sign of a threat than to miss the sign of an opportunity.
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The world has transformed massively since then, but our brains have not
The human brain has been shaped by millions of years of evolution to achieve a simple goal: stay alive long enough to reproduce and raise offspring. Consequently, we react more strongly to threats and unpleasantness than to opportunities and pleasures.
We all have a red alert buzzer in our brain for bad things, but no green alert for good things. Sticks get our attention and carrots do not, because dodging the sticks was what used to be critical to staying alive.
Rick Hanson, a neuropsychologist explains this “negativity bias” thus:
“To keep our ancestors alive, we evolved a brain that routinely tricks us into making three mistakes: overestimating threats, underestimating opportunities, and underestimating resources.”
So being highly alert to risks is a good strategy for surviving dangerous environments, but not for thriving in today’s workplace. When risks aren’t life-threatening, you have to resist your brain’s predisposition to run from what are usually survivable dangers.
In fact, if you are not actively seeking and creating new opportunities you are actually exposing yourself to greater risks in the long term.
What are good risks for you to take?
Risk is highly personal. So what might be risky to someone else might not be risky for you. It’s also situational - what may be risky in one situation may not be if the circumstances are slightly different. But for almost everyone, a risk is worth taking when the possible upside outweighs the possible downside i.e. when the potential reward justifies the risk.
“All courses of action are risky, so prudence is not in avoiding danger (it’s impossible), but calculating risk and acting decisively.” - Machiavelli
So the key to success is being able to accurately assess risk and reward, not seeking to avoid risk altogether.
Here are some career choices which are often unduly rejected as being too risky and the associated opportunities:
Jobs that may not pay well but offer great learning potential
People are inclined to focus on easily quantifiable elements - like how much they’re getting paid. Or the hours of work involved each week. But other “soft” assets -knowledge, connections, and experience are of increasing value in this digitally connected age.
The world is changing at faster rate than ever before and skills which were relevant and valuable ten or even five years ago can quickly become much less so, sometimes almost overnight. To compensate for this, we all have to recognise that we need to continually invest in the growth of our personal networks, skills and knowledge.
You may be young, or you may be making a change of direction. Either way, the opportunity to learn new skills can be more valuable in the long run than the opportunity to earn the most you can right now. Work with great learning but less remuneration involved may be too quickly dismissed as risky.
So do not under-value opportunities such as:
- Internships and Apprenticeships
- Sideways transfers or assignments
- High-level assistantships
Part-time work vs. full-time jobs
Some people dismiss part-time and contract work as being a poor substitute for full-time jobs. But in reality, doing contract work is a powerful way to grow the skills and relationships that can help you find and move into your next opportunity.
And there’s a rising use of contractors as firms seek to keep their investment in expensive full time staff to a minimum.
Typical areas where such work is plentiful include:
- Design work
- Writing
- Programming
Not understanding the ‘conversion funnel’
Success requires persistence. Just because someone doesn’t like what you have to offer, doesn’t mean no-one will. You just have to keep refining your proposition, building your network and knocking on more doors. Sales people and actors have learned through experience to appreciate this instinctively. Sometimes for them, 1 hit out of 100 attempts equates to a runaway success.
For those of us used to a more stable and secure working environment, a single rejection or negative comment can cause us to drop a good idea far too readily.
So be careful about:
- Assuming that a few rejections means your idea or offering is no good
- Building a plan which requires too high a ‘hit rate’ to be successful
Fast learners can easily compensate for their inexperience with enthusiasm and commitment. The flip side of inexperience is often hustle, energy, and a willingness to learn. For example:
- Taking a chance on a smart and enthusiastic person just out of college
- Partnering with someone mid-flight in a career who’s moving into a new industry and feeling re-energized by the challenges
- Recognising that a person with a different background can bring fresh and novel perspectives
Opportunities where dangers have been in the news
The more we hear about the downsides to something, the more likely we are to overestimate the probability that it will occur (this is why people tend to become more afraid of flying after news of a plane crash is splashed across the headlines).
If the media, or people in your industry, talk a lot about the riskiness of a certain job or career path, our brains absorb this information and use it to bias our judgements, sometimes unduly negatively.
- Starting a company
- Working in a high tech industry
- Joining a start-up business
Overseas opportunities
International career opportunities are sometimes rejected out of hand as too difficult or uncertain. Spending time in other countries feels risky in part because when you’re not a native, at first you may find it hard to feel comfortable with a different culture around you.
But the world is getting smaller every day. Your skills and experience may be abundant in your native land. And other countries are often crying out for the skills that you have yet to find a buyer for at home.
Don’t let unfamiliarity trick you into overestimating the risk. In the words of Tim Ferris, “Most people will choose unhappiness over uncertainty.” Turn this fact to your advantage, by rising above the unreasonable fears of your competition.
Examples:
- Foreign assignments within your company
- Attending a conference or seminar in another country
- Volunteering overseas
In all these opportunities, the worst case scenario tends to be survivable. When the worst case of a given risk means possibly getting fired, losing some time or money, experiencing a little discomfort, it’s a risk you should not reject out of hand.
By contrast, if the worst-case scenario may lead to serious damage to your reputation, loss of all your personal assets, or something otherwise career-ending, don’t countenance that risk.
Ask yourself whether you can tolerate the worst case scenario? If the answer is yes, you know what to do next.
This redundant logic is hard-wired into our brains: It’s more dangerous to miss the sign of a threat than to miss the sign of an opportunity.
The world has transformed massively since then, but our brains have not
The human brain has been shaped by millions of years of evolution to achieve a simple goal: stay alive long enough to reproduce and raise offspring. Consequently, we react more strongly to threats and unpleasantness than to opportunities and pleasures.
We all have a red alert buzzer in our brain for bad things, but no green alert for good things. Sticks get our attention and carrots do not, because dodging the sticks was what used to be critical to staying alive.
Rick Hanson, a neuropsychologist explains this “negativity bias” thus:
“To keep our ancestors alive, we evolved a brain that routinely tricks us into making three mistakes: overestimating threats, underestimating opportunities, and underestimating resources.”
So being highly alert to risks is a good strategy for surviving dangerous environments, but not for thriving in today’s workplace. When risks aren’t life-threatening, you have to resist your brain’s predisposition to run from what are usually survivable dangers.
In fact, if you are not actively seeking and creating new opportunities you are actually exposing yourself to greater risks in the long term.
What are good risks for you to take?
Risk is highly personal. So what might be risky to someone else might not be risky for you. It’s also situational - what may be risky in one situation may not be if the circumstances are slightly different. But for almost everyone, a risk is worth taking when the possible upside outweighs the possible downside i.e. when the potential reward justifies the risk.
“All courses of action are risky, so prudence is not in avoiding danger (it’s impossible), but calculating risk and acting decisively.” - Machiavelli
So the key to success is being able to accurately assess risk and reward, not seeking to avoid risk altogether.
Here are some career choices which are often unduly rejected as being too risky and the associated opportunities:
Jobs that may not pay well but offer great learning potential
People are inclined to focus on easily quantifiable elements - like how much they’re getting paid. Or the hours of work involved each week. But other “soft” assets -knowledge, connections, and experience are of increasing value in this digitally connected age.
The world is changing at faster rate than ever before and skills which were relevant and valuable ten or even five years ago can quickly become much less so, sometimes almost overnight. To compensate for this, we all have to recognise that we need to continually invest in the growth of our personal networks, skills and knowledge.
You may be young, or you may be making a change of direction. Either way, the opportunity to learn new skills can be more valuable in the long run than the opportunity to earn the most you can right now. Work with great learning but less remuneration involved may be too quickly dismissed as risky.
So do not under-value opportunities such as:
- Internships and Apprenticeships
- Sideways transfers or assignments
- High-level assistantships
Part-time work vs. full-time jobs
Some people dismiss part-time and contract work as being a poor substitute for full-time jobs. But in reality, doing contract work is a powerful way to grow the skills and relationships that can help you find and move into your next opportunity.
And there’s a rising use of contractors as firms seek to keep their investment in expensive full time staff to a minimum.
Typical areas where such work is plentiful include:
- Design work
- Writing
- Programming
Not understanding the ‘conversion funnel’
Success requires persistence. Just because someone doesn’t like what you have to offer, doesn’t mean no-one will. You just have to keep refining your proposition, building your network and knocking on more doors. Sales people and actors have learned through experience to appreciate this instinctively. Sometimes for them, 1 hit out of 100 attempts equates to a runaway success.
For those of us used to a more stable and secure working environment, a single rejection or negative comment can cause us to drop a good idea far too readily.
So be careful about:
- Assuming that a few rejections means your idea or offering is no good
- Building a plan which requires too high a ‘hit rate’ to be successful
- Interpreting a negative reaction as reason to abandon what you are planning instead of refining it
Choosing to work with someone with less experience but high commitment
Choosing to work with someone with less experience but high commitment
Fast learners can easily compensate for their inexperience with enthusiasm and commitment. The flip side of inexperience is often hustle, energy, and a willingness to learn. For example:
- Taking a chance on a smart and enthusiastic person just out of college
- Partnering with someone mid-flight in a career who’s moving into a new industry and feeling re-energized by the challenges
- Recognising that a person with a different background can bring fresh and novel perspectives
Opportunities where dangers have been in the news
The more we hear about the downsides to something, the more likely we are to overestimate the probability that it will occur (this is why people tend to become more afraid of flying after news of a plane crash is splashed across the headlines).
If the media, or people in your industry, talk a lot about the riskiness of a certain job or career path, our brains absorb this information and use it to bias our judgements, sometimes unduly negatively.
Examples of this include:
- Starting a company
- Working in a high tech industry
- Joining a start-up business
Overseas opportunities
International career opportunities are sometimes rejected out of hand as too difficult or uncertain. Spending time in other countries feels risky in part because when you’re not a native, at first you may find it hard to feel comfortable with a different culture around you.
But the world is getting smaller every day. Your skills and experience may be abundant in your native land. And other countries are often crying out for the skills that you have yet to find a buyer for at home.
Don’t let unfamiliarity trick you into overestimating the risk. In the words of Tim Ferris, “Most people will choose unhappiness over uncertainty.” Turn this fact to your advantage, by rising above the unreasonable fears of your competition.
Examples:
- Foreign assignments within your company
- Attending a conference or seminar in another country
- Volunteering overseas
In all these opportunities, the worst case scenario tends to be survivable. When the worst case of a given risk means possibly getting fired, losing some time or money, experiencing a little discomfort, it’s a risk you should not reject out of hand.
By contrast, if the worst-case scenario may lead to serious damage to your reputation, loss of all your personal assets, or something otherwise career-ending, don’t countenance that risk.
Ask yourself whether you can tolerate the worst case scenario? If the answer is yes, you know what to do next.
Thank you! If we're consistently mindful of our value and continue to build that value, not only will you land your next job by differentiating yourself from the crowd, you'll positively impact your chances of job security. Since I worked for the same company for over 15 years, I'm learning that job security means remaining employed, not staying with the same employer.
ReplyDeleteThank you Chrsitina. Your comment is right on the money I think! Employers seldom have any real loyalty to us, despite their frequent proclamations to the contrary. We have to look after ourselves; no-one else is going to...
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