Risk at the Roots

A philosophical discussion of the nature of risk. Drawing on Pascal, Bernoulli and Stephen Jay Gould, the author argues, 1) that it is the importance of the outcome rather than its probability that should determine whether or not one should hedge against it; 2) one can never escape uncertainty; 3) we all depend too much on averages and other measures of central tendency, in our desire to simplify, and tend to ignore individual variety; yet risk management depends on recognising that variety.

Risk at the roots

Peter Bernstein

The dominance of rational models of human behaviour has led to the notion that some form of quantification of variables can guarantee safety against risk. The view expressed here is both more elegant and sublimely logical. Drawing inspiration from Pascal, Bernoulli and Gould, Bernstein argues that risk is not only inevitable but valuable and that a predictable world would be the most dangerous of all.

Business management is a process rooted in the future. We do not know the future. Then how in the world can we make decisions? In this article I look...

WARC subscribers can sign in to keep reading

Not a subscriber?

Schedule your live demo with our team today

WARC helps you to plan, create and deliver more effective marketing

  • Prove your case and back-up your idea

  • Get expert guidance on strategic challenges

  • Tackle current and emerging marketing themes

We’re long-term subscribers to WARC and it’s a tool we use extensively. We use it to source case studies and best practice for the purposes of internal training, as well as for putting persuasive cases to clients. In compiling a recent case for long-term, sustained investment in brand, we were able to support key marketing principles with numerous case studies sourced from WARC. It helped bring what could have been a relatively dry deck to life with recognisable brand successes from across a broad number of categories. It’s incredibly efficient to have such a wealth of insight in one place.

Insights Team
Bray Leino

You’re in good company

We work with 80% of Forbes' most valuable brands* and 80% of the world's top top-of-the-class agencies.

* Top 10 brands