Fifteen years ago, I was climbing with a friend, his girlfriend, and one of their friends. My friend had been climbing for about a decade—long enough to be highly experienced but never formally trained. He prided himself on carrying as little gear as possible to minimize weight. That day, he attempted a short but challenging 40-foot climb that was right at the limit of his skill level.
About three-quarters of the way up, he realized he had a problem. He had placed only one piece of protective gear, and the other two he carried were too large for the available crack. Struggling beneath an overhang, he did something that made my stomach drop—he reached back down across his body, pulled out his single piece of protection, and placed it higher in the crack above him.
For a fraction of a second, he was completely exposed. No protection, no backup, just raw skill and hope that the limestone held. If the rock had crumbled at that moment, he would have fallen 30 feet straight to the ground. A helmet and three people ready to carry him to the ER maybe would have saved his life. Maybe.
That day, he got lucky. But luck is not a risk management strategy.
The Business of Risk: Why Preparation Matters
Rock climbing often seems like a semi-suicidal sport. Unpredictable weather at high elevations, million-year-old rock that can crumble under an ounce of extra weight, faulty gear, inexperienced partners, bravado, or misunderstanding equipment capabilities can all result in serious injury or death. But experienced climbers don’t rely on luck. They rely on preparation, training, and structured risk management principles that have been developed over decades.
The same is true in business. Companies face their own unpredictable terrain—economic downturns, cybersecurity threats, regulatory changes, and operational failures. Leaders who, like my friend, try to cut corners, ignore best practices, or take on challenges beyond their preparation often find themselves in situations where failure is no longer just a possibility—it’s inevitable.
In both climbing and business, success isn’t about avoiding risk altogether—it’s about understanding and managing it effectively. Whether scaling a rock face or leading an organization, the difference between survival and disaster comes down to:
✔ Assessing risk properly
✔ Investing in training and preparation
✔ Building contingency plans
✔ Understanding limits and knowing when to pivot
Understanding Risk: Exposure vs. Likelihood
One of the most important concepts in both climbing and business is distinguishing between exposure and likelihood:
- Exposure is the severity of a potential consequence. My friend's risk wasn’t just a scraped knee—if he had fallen, the outcome would have been catastrophic.
- Likelihood is the probability of that event happening. He probably felt confident in his skill and in the integrity of the rock, but that confidence didn’t eliminate risk.
Many businesses, like my friend, underestimate their exposure or overestimate their ability to manage risk on the fly. For example:
- A major cybersecurity breach is high exposure. If hackers gain access to customer data, the consequences could be devastating. However, with proper security measures, the likelihood of a breach can be significantly reduced.
- A critical supply chain disruption might seem unlikely, but without redundancy or alternative sourcing plans, the exposure can be business-ending.
In climbing, smart climbers place extra protection when they know the exposure is high. Businesses must do the same by implementing preventative risk management strategies rather than relying on last-minute improvisation.
The Role of Training and Preparation
A reckless climber who ignores best practices is an accident waiting to happen. Those who succeed in the sport spend years mastering:
✔ Movement techniques
✔ Gear placements
✔ Self-rescue procedures
✔ Reading weather conditions
✔ Decision-making under pressure
They don’t just climb on perfect days—they train for worst-case scenarios.
Organizations that fail to train employees, stress-test procedures, and build a culture of preparedness are setting themselves up for failure. Risk management should be:
- Proactive, not reactive – Anticipate issues before they escalate.
- Comprehensive – Train employees at all levels, not just leadership.
- Reinforced through real-world drills – Just as climbers practice self-rescue techniques, businesses must conduct simulated crisis response exercises.
Contingency Planning: Self-Rescue vs. Crisis Management
Many companies rely too heavily on external consultants when disaster strikes, only to find themselves unprepared in real-time situations. Instead, businesses should focus on:
✔ Developing internal crisis response teams with clear roles and responsibilities.
✔ Testing response plans through simulations—not just reading them from a policy manual.
✔ Building financial, operational, and strategic reserves to sustain operations during disruptions.
Just like a climber carries extra gear in case of emergencies, companies must have contingency measures in place for unexpected disruptions—because outsourcing crisis response at the last minute is too late.
Risk Tolerance: Knowing Your Limits
Not every climber attempts to summit El Capitan or scale frozen waterfalls in sub-zero temperatures. Risk tolerance varies depending on:
- Skill level
- Physical fitness
- Experience
- Confidence in contingency planning
Companies must define their risk appetite based on:
✔ Financial capacity – How much loss can they afford?
✔ Market position – Can they take on aggressive expansion?
✔ Operational resilience – How quickly can they recover from disruptions?
Defining risk tolerance ensures that businesses make strategic, data-driven decisions rather than gambling recklessly.
The Balance Between Caution and Courage
Both in climbing and in business, success is not about avoiding risk—it’s about mastering it. The best climbers don’t stay on the ground out of fear; they prepare, plan, and execute with precision. Likewise, businesses that take calculated risks, implement strong governance, and foster a culture of preparedness are the ones that thrive in the long run.
Key Takeaways for Business Risk Management:
✅ Assess Risk Through Exposure and Likelihood – Not all risks are created equal; prioritize wisely.
✅ Invest in Training and Preparation – Employees and leadership must be equipped to handle uncertainty.
✅ Learn from Near Misses – Close calls are learning opportunities, not excuses to ignore risk.
✅ Develop a Strong Contingency Plan – Crisis management isn’t about avoiding problems; it’s about responding effectively.
✅ Define Your Risk Tolerance – Every business must understand its limits and make informed decisions accordingly.
Final Thought
Whether scaling a rock face or steering a company through turbulent times, one truth remains:
Those who respect risk, prepare diligently, and adapt swiftly are the ones who reach the summit.
