How To Know Your Risk Appetite


man drawing risk variables on whiteboard

Accepting the Risk of a New Job

What attracted me to my current job was the opportunity to affect lives more directly. I was also attracted to the very big opportunity to take a critical function within my new role (sourcing and procurement) to its next level of maturity and add value to the business during an exciting time when the company is expanding into the global market.

Better Health Starts With Me

I started work at a new start-up health company two years ago. My team contributes to better business health by identifying and negotiating with the optimal suppliers for business services and products and also by partnering with business units to find efficiencies and savings related to business processes.

My job is to bring new ideas and innovative ways to address indirect spending across the company.

Indirect spending includes purchases for business operations that aren’t included in the cost of the products we sell. Some examples are technology, consultants, cleaning supplies, furniture — indirect spending covers everything we use to run our business.

For instance, one area of indirect spending is office supplies. We recently migrated to Office Depot as the preferred supplier for all our office supplies, making it a more streamlined, cost-effective solution for the business and every employee.

We’re also able to support business needs by finding diverse suppliers. Some of our customer contracts — especially those with the government — require that we support diversity in our supply base.

What Is a Risk Appetite?

woman drawing risk variables on whiteboardA few months ago, I was invited to speak at OWN IT’s International Women’s Day celebration. One of the questions posed was “When and how do you take risks?”

For me, I challenge women to first know their “risk appetite.” What I mean is, depending on your life stage in terms of your responsibilities and activities, your risk appetite is going to change. So you need to be aware of where you are in that spectrum.

For example, if you have a newborn baby at home, your risk appetite might be lower than if you have an older teenager. So ask yourself, “How much autonomy do I have right now? How free am I to move?”

It’s good to stretch yourself and take on new risks. But it’s something you want to do thoughtfully by really understanding your dependencies as you consider new challenges.

Are There Safer Ways to Take Risks?

Yes. Be sure you first have an “anchor” to lean on — skills and experience that anchor you into this new adventure and position you for success.

I don’t have experience in healthcare but I do have an anchor of experience in procurement, indirect procurement and supply chain, and I have experience working in large organizations such as IBM and Hewlett Packard.

That background helped me leapfrog into my current role even though there are many other things that I still have to learn. Having an anchor to build on helps you make bigger leaps forward in your career.

Don’t Underestimate Your Readiness

On the other side of the coin, we often don’t give ourselves enough credit for what we do know. Sometimes we’re our own worst enemy. So you need to create a circle of friends, colleagues and sponsors who are there to support and advocate for you as you assess and evaluate new risks — is that move or that project the right move for me?

Why I Love My Job

Thankfully for me, my current job culture is warm and inviting. So many people have helped me get up to speed. It’s all about partnerships here. The stakeholders an my team have truly embraced me as a leader.

Find something you love to do and people you love to work with and you’ll realize that you can handle any amount of risk and turn it into a great opportunity for success!

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