The dictionary defines it as “the possibility of incurring misfortune or loss”. I would go so far as to say that it should also include “the possibility of a missed opportunity”.

You see, every situation has two sides to it. There is a down side e.g. a loss, but there is also an upside e.g. a win. Gambling is a very good example of this.

By its very nature therefore, risk can involve excitement, as much as it can anxiety and trepidation. This is what often produces an adrenalin rush when gambling.

Risk should not be anything new to us. After all, from when we get up every morning, we spend the rest of our waking hours avoiding risks. Driving safely for example, is all about avoiding accidents i.e. risks. That is the down side. The upside is getting to our destination to see our friends or to enjoy an occasion or an event, or simply enjoying the pleasure of driving a car or motorcycle.

From early childhood, we are taught to avoid risk. “Don’t put your finger in the socket or you will be electrocuted”. “Don’t run across the road or you could be knocked down”. “Don’t eat that, it could poison you”. Sounds familiar?

When we arrive in the world of work, we avoid risk almost instinctively. And no wonder, as we have had a lifetime of being told how to avoid it. And then, guess what happens? We are told about a whole raft of other risks that we must avoid, and which we knew nothing about. The induction manual is usually full of information on this and the HR department seems to spend its time finding and then telling us about new risks to avoid – at all costs.

All in all, we have no choice but to avoid risks and we learn to do as little as it is possible to get away with. By taking that approach, we avoid the risks and, most importantly, the consequences of them.

The leaders of the business have had a nasty shock this last year or so, and as a result they have introduced “risk management”. They have appointed a risk manager and they are charged with finding and reducing, or better still eliminating, yet more risks. And so everyone in the business does less and less, so as to avoid risk; real or imagined.

The leaders of the business are now bewildered, frustrated and anxious because, despite introducing risk management, revenue is now falling even faster than it was and profit has all but disappeared. More risk management is introduced, and the risk manager recruits an assistant. The employees respond by doing less and less; so as to avoid risk.

The company, a good one, eventually goes bust, no one knows why, but at least they had an effective risk management policy. Einstein once said that “logic can get you from A to B. Imagination can take you anywhere”. Some of the greatest advances the world has ever seen were the result of people being brave enough and bold enough to take risks. The astronauts who went to the moon are an example of this.

Those astronauts, and their colleagues in NASA, did not ignore risk (indeed they had extremely good risk assessment procedures), but equally they did not let avoiding risk suffocate their imagination and their determination to put a man on the moon. When things did go wrong, for example on Apollo 13, they contained and managed the consequences and because they were encouraged to, and were used to using their imagination, they brought those astronauts safely back to earth.

The movie Apollo 13 should be a must for all leaders and managers. It is a great example of leadership, managing a crisis and getting the very best out of people. Risk is actually the central theme of the movie and it shows how, when you use risk management positively, by looking at the upside more than you do the downside, you create a highly motivated and inspirational team – and that could take your business to the moon.

Well, from my own previous experience as a project manager, instead of risk schedules for projects (which generally drained energy from the team) we introduced “opportunity schedules”. They were designed to look at a potential risk and find out how we could derive a beneficial opportunity out of it. This item on the agenda of meetings was the one that everyone couldn’t wait to get to. The ideas flowed and flowed, people were motivated and the energy in the team was palpable.

By all means manage risk, it's sensible to do so, but look at the upside more than the downside. And as for the financial crisis, that was nothing to do with risk management. It was all about greed – and the Bible (which provides a fascinating insight in to human nature) is full of stories that outline both the predictability of that and the consequences of it. Perhaps the banks should appoint greed managers rather than risk managers.