taking a calculated risk
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2.5_taking_a_calculated_risk.pptx | |
File Size: | 1904 kb |
File Type: | pptx |
2.5_taking_a_calculated_risk_starter_activity.docx | |
File Size: | 36 kb |
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Key term: CALCULATED RISK - The probability of a negative event occurring. A risk for which the potential costs and potential benefits have been weighted and considered. Often given as a numerical value i.e. 1 in 5 chance / 20% chance.
Key term: UPSIDES - The advantages of a course of action, including what can go right.
Key term: DOWNSIDES - The disadvantages of a course of action, including what can go wrong.
Key term: UPSIDES - The advantages of a course of action, including what can go right.
Key term: DOWNSIDES - The disadvantages of a course of action, including what can go wrong.
Calculated risk is about putting a numerical value or probability on the risk. For example, if a risk is very high, this could be 50:50 or have a 50% chance of happening. If something has almost no chance of happening, it is almost zero or 0%. You can reduce your risks by knowing what the customer wants, and by delivering what the customer wants.
The downsides are what could go wrong. A business might try and put a financial figure on what they might lose if things go wrong.
The upsides are what can go right. A business will put a figure on the reward to make a comparison with the risks.
If the chances of making a reward are greater than the chances of losing money, then a business will take a calculated risk and go ahead. Weighing up the risks and the rewards of a new business idea is an important part of the process of judging outcome and viability of a start-up.
The downsides are what could go wrong. A business might try and put a financial figure on what they might lose if things go wrong.
The upsides are what can go right. A business will put a figure on the reward to make a comparison with the risks.
If the chances of making a reward are greater than the chances of losing money, then a business will take a calculated risk and go ahead. Weighing up the risks and the rewards of a new business idea is an important part of the process of judging outcome and viability of a start-up.
2.5_taking_a_calculated_risk_activity.doc | |
File Size: | 55 kb |
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Sometimes, the downsides turn out to be greater than the rewards and a business will lose money. Making mistakes is part of the process of learning to succeed. If a business idea turns out to be a failure, then it will help the business in the future to make the right decisions.
bmw_data.pptx | |
File Size: | 223 kb |
File Type: | pptx |