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Updated: Oct 26, 2018

 

At the start of a new year I find it fascinating to see how people prepare themselves mentally for this new beginning – some have clear-cut goals with specifics defined while others will “take the year as it comes”.

It has been proven over and over again that having goals focuses your energy and makes the probability of achieving these goals significantly higher. Yet, it is still not a practice that is commonly applied.

 

Pondering the reasons for this, I reflected on what I have learnt about goal setting from the people around me and from my own experience. Here are some of those reflections:

  • When setting a goal, I make a commitment to myself. This means that this is a real goal and not just a dream or wish that has not yet matured.

  • Putting a measure to it helps me to think about how I will go about achieving the goal.

  • Why am I doing this and what are the benefits? Understanding the motivation behind the goal helps to give me momentum for the journey ahead. It helps me to maintain focus when encountering obstacles.

  • Understanding the trade-off that I am prepared to make to achieve my goal helps me to understand the importance of the goal.

  • I think carefully about whether I should communicate this goal to others. Some goals are deeply personal. Scrutiny from others can easily cause one to lose focus.

  • If I want to communicate my goal to a specific person, I think carefully about why, how and when I want to share this. This helps me to decide whether I should go ahead or not.

  • I think about what the support I need from people around me to achieve this goal and then request their support by explaining the goal and communicating what exactly I need from them.

Making goals explicit is about setting the direction toward achieving personal and business success. Also, being flexible can help you to capitalise on potential windfalls and work around obstacles on your way toward achieving these goals.

Updated: Oct 13, 2018

Life is uncertain and no one knows everything. Every single day, we are faced with choices or decisions without having at our disposal all the information that could influence the outcomes of these choices or decisions. Some of these decisions come with major risks that could have a substantial impact on the way the future is realised. Taking a calculated risk by quantifying these risks can help with the decision-making process. This is significantly more empowering that simply “closing your eyes and hoping for the best”.

 

The Cambridge Advanced Learner’s Dictionary defines a calculated risk as “a risk which you consider worth taking because the result, if it is successful, will be so good”.

 

So let’s see how you can go about deciding on taking a calculated risk. The following pointers will help you to quantify a risk:

  • What is the description of the risk? Consider the external factors and your own previous endeavours. For example: If I start my own business, there is a risk that I will not sell enough of my products and not get enough income to make a profit.

  • If the risk materialises, what is the size of the impact?  In our example: If I do not make a profit, I will need to take money from my personal savings. Or: If I do not make a profit, I will not be able to support my family from my income.

  • Does this impact matter to you and, if so, to what extent? This is where your priorities and values come into play. For example: I will not be able to support my family from my income. Or: We will have to cut down on our personal expenditure.

  • If the impact matters to you, what can you do to counter the risk? I can make sure that I keep an alternative source of income while setting up my own business. Or: I can make sure that I have a bulk order before buying stock.

  • What other safety nets do you need before taking this risk? As per our example: I need to have 6 months of income saved before I start my own business. Or: I need to make sure that I have that contract signed by that date.

  • What else do I need to know that will help me to quantify the risk? As per our example: What would be the market appetite for the product I want to sell?

  • Is there anything else that bothers me? Trusting your gut feel is also an important input to quantify the risk.

  • What is the potential reward or return of this risk? I will be able to make a profit of R 5,000 a month.

This ability-to-sleep-at-night test, also referred to as the iron-stomach test in the investment world, can help you to assess whether the potential reward is worthwhile when measured against risk.

 

 

The Power of AssumptionsThe Power of Assumptions

In our daily interactions we make on-the-fly assumptions about people or situations. Assumptions impact our behaviour in that they influence how we engage with others and how we make decisions. Our assumptions are based on our values, beliefs and experience, and we apply them unconsciously.

 

Understanding the assumptions you hold can help you in situations where you are caught in the rut of conflict or when you need to solve a problem and are struggling to get into the zone of thinking differently. Alan Alda (1936), American actor, director, screenwriter and author, said: “Your assumptions are your windows on the world. Scrub them off every once and a while, or the light won’t come in.”

 

The following questions can help you to make those assumptions explicit and to “clean your windows to the world”:

 

  • What are you assuming about your own knowledge? What are facts and what are your own conclusions?

  • What do you assume about your abilities? What are the real limitations and who has enforced those on you?

  • What are the assumptions you hold about the other person’s motives? What do you think are his/her expectations about your motivation?

  • What do you assume about the other person’s knowledge or abilities?

  • What do you assume about the outcome of the conversation or the engagement? Do you expect a positive outcome, or do you anticipate the conversation to be a waste of time?

  • One of the five disciplines that Peter Senge writes about in his book The Fifth Discipline: The Art and Practice of the Learning Organization (1990) is that of team learning. He says that team learning entails dialogue, and the capacity of team members to suspend assumptions and enter into genuine thinking together.

 

Making your assumptions clear can help you to understand what to suspend. It can also help you to have productive and innovative conversations and relationships.