Risk Management Orderings

Input: $ARGUMENTS

Overview

When stakes are high and outcomes uncertain, order decisions to preserve optionality, defer irreversible commitments, and minimize catastrophic downside. Risk-aware sequencing.

Ordering Rules

Rule 1: Reversible Before Irreversible

Make reversible decisions first, defer irreversible ones
Gather information from reversible decisions to inform irreversible ones
When: mix of reversible and irreversible choices

Rule 2: Kill the Biggest Risk First

Identify the risk that would be most damaging if realized
Address it first, even if other tasks are easier
When: one risk dominates the failure probability

Rule 3: Preserve Options

When uncertain, choose paths that keep the most future options open
Avoid commitments that close doors until you have information to choose wisely
When: early-stage decisions, high uncertainty

Rule 4: Minimax — Minimize the Maximum Loss

For each option, identify the worst possible outcome
Choose the option with the least-bad worst case
When: downside risk matters more than upside gain

Rule 5: Insurance First

Before pursuing upside, protect against catastrophic downside
Hedging, backups, contingency plans BEFORE aggressive moves
When: asymmetric risk (small upside, large potential downside)

Application

Step 1: Map Decisions and Risks

What decisions need to be made?
Which are reversible vs irreversible?
What are the key risks?

Step 2: Order by Risk Profile

Reversible, information-gathering decisions first
Risk-reducing actions next
Irreversible commitments last

Step 3: Build in Checkpoints

After each major decision, reassess risk landscape
Adjust ordering if new information changes the picture

When to Use

Investment decisions, strategic planning
Any high-stakes sequential decision-making
Startup strategy, career decisions

Verification

Reversible vs irreversible classified
Biggest risks identified and addressed early
Options preserved as long as possible
Checkpoints built in for reassessment