The 5-Step Risk Analysis Plan for Any Life Goal

Fellow Riskologist,

If the source of your fears remain the same throughout your life, I’d argue you’re not truly living.

Last week, I published a piece called The Risk-Taker’s Boogeyman syndrome, and many brave Riskologists answered my call to arms:

Identify where your fears come from—where your boogeyman lives—and take a step towards moving them further away.

In life, most of us will never experience complete fearlessness, but it also isn’t necessary. In fact, thinking fearlessness is the goal will hold you back. Instead, I say the main ingredient to a great life is to challenge your fears—to confront your boogeyman—and move them from one place to anther (hopefully further away).

If you’re working on a big goal for your life, you’ll have to go through this process many times.

My Own, Personal Boogeyman

In my quest to join the 7 Summits Club, I have to face these kinds of fears regularly. And the fear that stands out the most for me now is climbing Mt. Everest. With some high altitude experience under my belt now, I don’t get too scared about the idea of climbing any more. But this is not true for Everest.

The idea of spending more than a month on the tallest mountain in the world still terrifies me a bit. There are so many variables involved in an expedition like this it quickly becomes overwhelming just to think about.

The more I understand about the mountain and what it takes to climb it, though, the less I fear it and the closer I get to standing on top of it.

The 5 Step Risk Analysis Plan for Any Life Goal

If there’s a project you’re trying to start, there are probably a lot of variables involved. As long as you don’t understand them and fail to plan for them, you’ll struggle to bring it to life. It’s hard to take a leap when everything feels like such a big risk.

What you need is a system to help you work out the many pieces of your big challenge so that you can take action on them.

This is the 5-step plan I use each time I take on a big challenge. Working this all out on paper is therapeutic. As we go through the steps, I’ll be using my future expedition on Mt. Everest as an example. You can do the same for your own project.

This is a repeatable process for any risk you want to take in your life, and it forces you to do these three important things:

Identify the risks involved.
Define and understand each important variable.
Create a plan to reduce each risk.

Step 1: Define the variables and threats to your success.

The first thing you must do to overcome a fear and mitigate a risk is to simply make a list of all the different moving pieces that have to be planned for and things that could go wrong.

In my example of climbing Mt. Everest, here are the major pieces of the puzzle that I’ll need to contend with:

Cost: Climbing Everest, at its cheapest, is still a very expensive endeavor.
Transit: I’ll need to figure out how to get to and from Katmandu, Nepal. From Katmandu, I’ll need to get to and from Everest.
Mountain Guide: I can’t climb Everest alone. I’ll need to hire a very skilled guide and at least one sherpa.
Climbing Gear: Climbing Everest requires a class of gear above anything I’ve had to use before.
Weather: Even in the best conditions, weather on Everest can be extremely harsh.
Crowds: Climbing Everest is becoming a bit popular which means more people on the mountain causing traffic jams on technical slopes.
Climbing Skills: Everest requires a level of technical climbing skills above what I have now.
Physical Conditioning: My body must be in top shape to handle the grueling climb.
High Altitude: Everest is the tallest mountain in the world at over 29,000 feet. Being at this altitude for any length of time can do significant damage to your health.

There are many other variables in an expedition like this, but these are the major pieces that I can start thinking about and planning for now.

Action Step: Make a list like this for your own project.

You’ll notice that, as you learn more, you’ll find new variables that you didn’t know about before. These are the “unknown unknowns,” and you always run into more of them. You can’t be expected to pre-plan for everything, but the better you do planning the pieces you do know, the less likely an unknown variable is to ruin things.

Step 2: Identify the Worst Case Scenario for each variable.

One of the biggest benefits to becoming more educated about the risks you take is that the more you understand, the better you can see and plan for Worst Case Scenarios. When you don’t understand what you’re up against, you’re more likely to commit one of these two major mistakes:

Overestimating the Worst Case Scenario: You may be scared of something that is unlikely to be a problem. This is the source of irrational fears that keep you from making progress on your goal. This is your personal boogeyman.
Underestimating the Worst Case Scenario: Without educating yourself, you may set out to do something extremely dangerous without planning for a very real and present threat.

For most of us—the cautious types—overestimating is a more likely scenario. Once you learn more about what you’re trying to do and practice at a smaller scale, you find the realistic Worst Case Scenario is usually not as bad as you once imagined. The boogeyman becomes a little less scary.

Action Step: For this step, use the variables from above and outline the realistic worst case scenarios you’ll face if each one goes terribly wrong.

Here’s my list for Everest:

Cost: I could fall short of my fundraising goals after committing large amounts of money to people and equipment that cannot be refunded. In this case, I would lose a lot of money and the trip would never materialize.
Transit: There aren’t many options for transport to and from the mountain. If my schedule fails, it could end or significantly delay my climb.
Guide: I could hire a bad guide that fails to prepare properly for the expedition or doesn’t keep me safe. If this happened, my climb could be ended early or I could be lead into a dangerous situation.
Gear: I could buy insufficient gear that gets me into a lot of trouble if I were to face extreme weather.
Weather: Storms are a regular occurrence on Everest. If I get caught in one below 8,000 m, it could prematurely end my climb. If I get caught in one above 8,000m, I could die.
Crowds: Getting caught in a slow-moving crowd above 8,000 meters could be deadly.
Climbing Skills: I could fail to train properly and fall during a technical section of the mountain. This would probably result in significant injury.
Conditioning: My body might be ill-prepared for the climb. This would force me to end the expedition early.
Altitude: My body could react poorly to the high altitude, causing cerebral edema. If not caught early enough, the result could be permanent brain damage or death.

Wow, there are a lot of worst case scenarios on my list that realistically could end in death. That’s not the most fun thing to think about, but it’s a good thing I’ve at least identified them!

Most likely, you will not face the same level of risk for your own challenge. But I can feel secure knowing that, as I learn more about climbing Everest, I’ll find many ways to significantly lower these risks.

Step 3: Figure out which variables affect the others.

In a big project with lots of moving pieces, you’ll find not all of them are as important as others. Instead, there’s a hierarchy and certain outcomes are connected to others. Figuring out how the different pieces of your project are interconnected will help to whittle your action steps down to a manageable amount.

Overwhelm can kill a big challenge, so complete this step carefully to narrow your focus.

To decide which risks are most important for you to focus on, go through your list above and ask yourself:

How does the outcome of this variable affect the others on my list.

You’ll find some stand alone and don’t affect other parts of your project while others are highly connected and failure would prevent other variables from even coming into play.

For my Everest expedition, here are the most highly connected variables I’ll need to focus on first:

Cost: If I don’t raise the money or find a way to lower the expense, the expedition cannot move forward. All other factors are irrelevant.
Transit: If I don’t successfully arrive at the mountain at the right time, an attempt at the summit will be out of the question. All other factors become irrelevant.

These are the two variables I control which could make or break the trip before it ever happens. But they’re not the only risks. Once I’m on the mountain, I can see that conditioning, altitude, and climbing skills are highly correlated:

Altitude: If I spend too much time at altitude or my body reacts poorly, it will affect my ability to use my climbing skills and conditioning. It will also impair my judgment.
Climbing Skills: If I fail to develop the climbing skills I need, I won’t climb efficiently and I’ll waste energy. It will also cause me to climb slowly and risk spending too much time at altitude.
Conditioning: If I don’t condition myself properly, I won’t be able to confidently execute my climbing skills and I will spend too much time at altitude.

I’ll need to make a plan to lower the risk of these variables blowing up in my face as much as possible. I get to completely control two of them, so I’ll focus my attention there. You’ll want to look at your project with the same scrutiny.

Action Step: Find the variables in your project that could cause problems in other places if neglected.

Step 4: Determine how likely each variable is to go wrong and how much you control it.

Now you have a list of the variables for your project that are connected with the others. You know you’ll want to focus on these. But you’re not quite done. Your last step before getting down to business is to decide how likely it is that each threat to your project so far will actually come to be, and decide how much control you have over it.

This is important where there are highly connected variables that don’t pose much risk, but several threats that stand alone could take down the whole project.

Here’s how I’ve evaluated the threats to my Everest expedition:

Cost: Low likelihood of failure because I have a high level of control. If I don’t raise the money I need, I can always delay the trip. Not ideal, but not a massive failure point.
Transit: Low likelihood of failure because I have a lot of skill in arranging itineraries. Even if something outside my control goes wrong, I feel confident I can at least find my way to Base Camp.
Guide: Low likelihood of hiring a bad mountain guide because I have access to people who can make excellent recommendations, and the trip budget will accommodate a skilled guide.
Gear: Low likelihood of failure because the best gear for climbing Everest is well established. It will be important that I follow recommendations and don’t skimp on important equipment.
Weather: High likelihood of failure, and I have no control over it. I will need to come up with a plan that lowers this risk as much as possible.
Crowds: Moderate likelihood of failure. Crowding is a reality on Everest these days, but there are strategies that can be used to avoid climbing in a traffic jam.
Climbing Skills: Low likelihood of failure. I have much control over the time and resources I dedicate to improving my climbing skills.
Conditioning: Low likelihood of failure as long as I keep up my current conditioning and don’t slack off.
Altitude: High likelihood of failure. I know my body, and it’s not the best at handling high altitude. I’ll need to carefully build a plan that allows plenty of time to acclimate to the high elevations and minimizes the amount of time spent near the summit.

Action Step: Determine how likely it is that something will go wrong in each variable of your own big project. And to what extent do you control the outcome?

Step 5: Define your “next steps” and get started.

You’ve done a lot of work up to this point to prepare yourself for success, but any smart Riskologist will tell you, “No plan is complete until you take action on it.”

You can spend the rest of your life making plans, but they’re all worthless until you’ve put them to work. You must begin to test your preparations against reality.

Action Step: To get started, create a “next step” that you can take right away for each of your project’s variables. These tasks should be small enough to be completed in a day. This prevents unnecessary procrastination.

Here are the next steps I’ve created for my own Everest expedition:

Cost: Create a rough budget that includes all major pieces of the expedition.
Transit: Research and make a list of all transit options for each leg of the trip.
Guide: Get in touch with three of my experienced climbing contacts to recommend a mountain guide.
Gear: Assemble a list of gear I’ll need to buy or rent to complete the expedition.
Weather: Research the different weather forecasting services for Mt. Everest.
Crowds: Create reminder to discuss crowd control with the expedition guide I select.
Climbing Skills: Study the Everest climbing route to find which skills will be the most important to develop.
Conditioning: Continue working out as usual. Create plan to increase intensity in the months prior to the trip.
Altitude: Create Pre-Everest climbing plan to acclimate to high altitudes before arriving in Nepal.

Your Homework Today

When it comes to making progress on your biggest life goals, things can get overwhelming quickly. Today’s article lays out more things for you to complete than you can probably accomplish today (but don’t let me keep you from trying if you’re up for it).

Your homework today is to do one thing from this lesson that will help you manage the risks involved in your own big project.

Tell us what your project is and what you’ll do in the comments below.