5 Tips For Contingency Planning

5 Tips For Contingency Planning

5 Tips For Contingency Planning

Like all forms of management speak “contingency planning” is not a phrase that comes up in casual conversation when you think about your everyday life. This oft-used phrase in the business world, however, has much to offer us if we take to heart the principle and not the phrase itself.

What is Contingency Planning? 

what is contingency

well simply put, any plan or course of action comes with a risk of failure. The severity of the risk we describe by probabilities and impact and when reviewed either singularly or in whole we seek to mitigate or avoid these risks by alternative means or contingency plans.

To a business that deals with risk such as construction, for example, contingency planning is habitual and ingrained within the culture. That’s not to say all companies do it well but that they are well versed with the principle.

why contingency

The recent vote by the UK to leave Europe demonstrates better than any management book the mess you can get in when you think to plan A, the “remain camp” in this example has no chance of failure. The so-called “Brexitiers” however cleverly voiced a vision but with no plan, not really expecting to win and so when plan A failed the country was left in chaos.

So what benefit would such thinking offer us in our everyday lives? Well if you think for a moment about the trials and tribulations of modern living; the things that get steam spewing from your collar then ask yourself; what would you give to avoid such situations? Well the solution may lay in contingency plans or a sensible interpretation of it, which like construction is habitual.

plan contongency

Now I’m not suggesting we all load up Excel and get the spreadsheets running probabilities and impact assessments for over boiling a saucepan of potatoes but having a mindset that thinks about actions and consequences, cause and effect can, at its extreme, save your life.

For those of you that read this and have children, you will know that a large part of your vocabulary centers on words and phrases such as “no”, and “don’t do that”. We risk assess on their behalf offering placating alternatives to the courses of action we see will lead to harm. We do this instinctively and without a spreadsheet in sight!

risk plan contingency

We often over compensate of course perceiving the risk far greater than it actually is but these things are not deterministic and risk is a risk. So what I’m saying is we all have an instinct for this stuff and that if we make ourselves more self-aware it is a skill we can nurture and grow; we can get better and more balanced.

So here are 5 tips;

1. Get a Balanced View of the Situation

Everything carries risk, even eating; but use your experience to decide if an alternative is really necessary.

2. Think about Short, Medium and Long-Term Outcomes

If you’re financial planning, a market dip at the beginning of your plan shouldn’t worry you.

3. Don’t Overthink 

A decision is a decision, move on and what’s done is done. If no one died it’s a success!

4. Set Yourself Goals

If you don’t know what you want, how can you assess whether a new plan is going to support or detract from that goal

5. Don’t Let Risk Ruin You Having Fun

The flip side of risk is an opportunity!