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Why Successful People Will Never Neglect A Backup Plan

Why Successful People Will Never Neglect A Backup Plan

A contingency plan doesn’t sound like what you would discuss with friends over cake and coffee, but it’s an essential part of any actual plans you make. You may need one (or more) for your business, school project, or even a family vacation. The biggest problem with making a contingency plan is that people often aren’t sure about what to include in it. Here is a handy guide for you to make a comprehensive one.

What is a contingency plan?

A contingency plan is a set of actions that you will take when something unexpected happens. Think of it as a backup plan, or a Plan B. It should have instructions that you can follow when your original plan doesn’t work out due to changes in the situation.

A contingency plan prepares you to deal with any future troubles you may encounter, and gives you some sort of escape route out of any accident.[1]

What happens if you don’t have a contingency plan?

If something goes wrong with your Plan A unexpectedly, or if accidents force you to change your current plan, chances are you will panic. Especially if you’re not well prepared to deal with contingencies, you probably can’t think straight enough to come up with the solution you need at that moment. You won’t know what to do.

What’s worse, until you’re able to get the situation under control, business can’t go back to normal. You’ll have to fix the trouble and make new plans.

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What if the contingency plan is a bad one?

Don’t think making a contingency plan is a simple task. A contingency plan should be comprehensive, which requires lots of careful consideration. Otherwise, it is not helpful.

For instance, you may be prepared for the wrong kinds of accidents. And when your plan doesn’t work out as expected, you won’t be organized enough to handle the crisis. That is, you’ll panic.

How can a contingency plan benefit you?

For instance, a contingency plan allows you to deal with accidents quickly and effectively.[2] In a business scenario, it can even help you save time and cost in repairing the situation.

Also, a contingency plan helps minimize the negative consequences or losses caused by the unexpected event. It guides you to start dealing with the situation as soon as something goes wrong and keeps you safe.

After all, having a contingency plan ready is reassuring, because you won’t have to worry about making new plans in a rush.

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You may think that accidents are unlikely. You may think that your Plan A is perfect. However, you should keep in mind that the future is uncertain until it becomes the present, and that we as human beings can’t control 100% of what happens. You don’t want to regret not having a contingency plan when it’s too late!

How to write a good contingency plan?

There are basically 5 steps:[3]

    We’ll now go through them one by one:

    1. Identify

    As a contingency plan has to do with what’s unexpected, you have to first try and predict the risks:[4]

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    • What could possibly go wrong?
    • How likely it would go wrong?
    • What’s the impact and consequences of the contingency?
    • What should be your reaction or solution?
    • How can you prepare for it in advance?

    2. Prioritize

    Using what you’ve written down in Step 1, rank your risks by their possible impact and likelihood. The more likely the risk will happen and the more serious the impact will be, the higher it should rank.

    You have to decide how much weighting to put on each risk according to your situation.

    3. Plan

    The next step is to actually write your contingency plan. Keeping in mind the resources available to you, design solutions to the risks you want to cover in the plan. Be realistic about your needs: perhaps some issues have to be dealt with before some others, or perhaps you have to take actions within a certain time frame, etc.

    It is also important to give clear and simple instructions, so that you won’t forget what you’ve written months later, or that someone will misunderstand them.[5]

    4. Execute

    If your contingency plan involves other people, say, your colleagues or your family members, talk it through with them. Let them know what they’re supposed to do when certain things happen.[6] Prepare them.

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    Then, if your plan includes actions to prepare for future accidents, execute them. This can help you lower the risks.

    5. Review

    Changes happen all the time. For your contingency plan to be practical, you should review it and make adjustments regularly. Evaluate the items in your plan. Over time, some risks may become more or less likely, or may bring about different outcomes. Learn your situation well, and update your solutions accordingly.

    If your plan is about large-scale risks such as natural disasters or server failures, conducting drills is very helpful to identifying any weaknesses of the plan, as well as making sure the people involved will be prepared to act according to the plan when they have to.

    Some concrete examples to put things into perspective:

    Example 1: Contingency plan for an outdoor exhibition

    • Potential risk: Rain
    • Who will be affected: Exhibitors, visitors, organizers and crew members
    • Action 1: Secure exhibit items
      • Who will take action: On-site crew members
      • Preparation: Rain-proof covers for exhibitors’ stalls, email exhibitors with weather forecasts 3 days in advance
    • Action 2: Lead visitors to sheltered areas
      • Who will take action: On-site crew members, security guards
      • Preparation: Mark designated areas as no-parking areas, waterproof jackets for crew

    Example 2: Contingency plan for delivering a speech to a big group of audience (co-workers)

    • Potential risk: The projector or the computer doesn’t work
    • Who will be affected: Me
    • Action: Write outline and key points on whiteboard as I speak
      • Who will take action: Me
      • Preparation: Notes in hard copy, 3 colored markers, printed handouts

    Featured photo credit: Flaticon via flaticon.com

    Reference

    More by this author

    Wen Shan

    Proud Philosophy grad. Based in HK.

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    Last Updated on June 13, 2019

    15 Best Entrepreneurs Books to Start Reading Now to Be Successful

    15 Best Entrepreneurs Books to Start Reading Now to Be Successful

    Knowledge is power, and you’re going to need a lot of it if you’re going to be able to steer your business to success.

    Without further ado, let’s take a look at the 15 best entrepreneurs books to get inspirations about success and grow your business.

    1. Think and Grow Rich by Napoleon Hill

      This book has been dubbed the Granddaddy of All Motivational Literature, and it was actually the first book that gave a prescription of what it takes to be a winner.

      Napoleon Hill draws from the stories of millionaires like Henry Ford, Andrew Carnegie, and Thomas Edison to illustrate the principles he put forth.

      Get the book here!

      2. The Lean Startup by Eric Reis

        A lot of startups end up failing, but many of these failures are actually avoidable. The Lean Startup provides a different approach that is now being adopted all over the world and changing the way that companies are developed and products are being launched.

        In The Lean Startup, Eric Reis describes what is required for a company to penetrate the fog of uncertainty in order to discover a path to a sustainable and successful business.

        Get the book here!

        3. The E-Myth Revisited by Michael E. Gerber

          In a revised edition of the 150,000-copy bestseller, The E-Myth, Michael Gerber refutes some of the myths that surround starting your own business and shows just how commonplace assumptions can end up getting in the way of being able to run a successful business.

          Gerber succeeds in walking the reader through the steps that occur in the life of a business, from infancy, through the pains of growing as an adolescent, to the perspective of the mature entrepreneur.

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          Get the book here!

          4. Rework by Jason Fried

            Most of the business books that you get today will give you the same advice: draft a business plan, study the competition, look for investors, and all that.

            However, Rework shows you a more effective, easier and faster means of succeeding when running a business. By reading it, you’ll be able to know why some plans are harmful, why you don’t really need to get investors, and why you’re better of shutting out your competition.

            Get the book here!

            5. How to Win Friends and Influence People by Dale Carnegie

              This is one of the most successful motivational books in history, selling well over 15 million copies since it was released in 1936. The book is timeless, and it appeals to businesses, self-help startups, and general readers.

              Carnegie believes that a lot of successes come from an ability to communicate rather than having brilliant insights. In his book, he teaches how to value others and make them feel appreciated and loved.

              Get the book here!

              6. Outliers: The Story of Success by Malcolm Gladwell

                Through this amazing book, Malcolm Gladwell is able to take the reader on an intellectual journey through the world of ‘outliers’. He asks the question of what truly differentiates high-achievers.

                His answer to this question is that we tend to pay too much attention to what successful people are like, and less attention to where they are actually from.

                Get the book here!

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                7. Rich Dad, Poor Dad by Robert T. Kiyosaki

                  This is the best personal finance book ever written. It tells the story of Kiyosaki and his two fathers; his real father, and that of his best friend (his rich dad), as well as how the two men helped him shape his opinions on money and investing.

                  It refutes the myth that you need to earn high to become rich, and it distinguishes between working for money and having money work for you.

                  Get the book here!

                  8. The Ascent of Money: The Financial History of the World by Niall Ferguson

                    Niall Ferguson, in this book, follows the money to tell the story behind the evolution of the word’s financial system, from the beginning way back in ancient Mesopotamia to the latest occurrences in what he had dubbed Planet Finance.

                    Fergusson also reveals financial history as the backstory behind our very own history, with an argument that the evolution of debt and credit is as significant as the history of technological innovation and the rise of civilization.

                    Get the book here!

                    9. Liar’s Poker by Michael Lewis

                      Michael Lewis landed a job at Salomon Brothers after getting out of the London School of Economics and Princeton within three years, he had risen to the rank of bond salesman, making millions for the firm and cashing out steadily.

                      Liar’s Poker is the amalgamation of these years — a look behind the scenes at one of the most turbulent times in American business. His book is Lewis’s account of an era where greed and gluttony were the order of the day.

                      Get the book here!

                      10. Drive: The Surprising Truth about What Motivates Us by Michael H. Pink

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                        A lot of people see money as the best motivator. Michael pink says it’s a mistake.

                        In this provocative book, he asserts that the secret to high performance anywhere is the need to direct our lives, to learn and create, and to do better by our world and ourselves.

                        Get the book here!

                        11. Getting Things Done: The Art of Stress-Free Productivity by David Allen

                          Outdated methods don’t work in today’s world. In this book, Allen shares some awesome methods for stress-free performance that he has shared with thousands of people all over the world.

                          His premise? That productivity is proportional to your ability to relax.

                          Get the book here!

                          12. The 7 Habits of Highly Effective People by Stephen R. Covey

                            In this book, Stephen Covey presents a holistic approach for overcoming both professional and personal issues. With insights and anecdotes, Covey presents a way to live with integrity fairness, service and dignity.

                            Get the book here!

                            13. The 4-Hour Workweek: Escape the 9-5, Live Anywhere, and Join the New Rich by Tim Ferriss

                              In this book, Ferriss dishes on the tips he has learned from studying the New Rich, a subculture of people who did away with the deferred life plan and mastered time and mobility to developed luxury lifestyles for themselves.

                              If you’re looking to make your way in this revolutionary new world, this here is your compass.

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                              Get the book here!

                              14. Delivering Happiness: A Path to Profits, Passion, and Purpose by Tony Hsieh

                                The CEO of Zappos shows how a unique kind of corporate identity can help deliver a huge difference in the way results are being achieved — by creating a company that values and delivers happiness.

                                Get the book here!

                                15. Losing My Virginity: How I Survived, Had Fun, and Made a Fortune Doing Business My Way by Richard Branson

                                  From Virgin Atlantic Airways, Virgin Records and V2 to Virgin Cola, Virgin Megastores and a wide array of other companies, Richard Branson is the rockstar billionaire that a lot of us want to be.

                                  Branson, however, did business by following a simple philosophy:

                                  “Oh, screw it, let’s do it”

                                  Losing My Virginity is an unusual, borderline outrageous autobiography of one of the greatest business geniuses in the world. Branson and his friends named their business “Virgin” because that was what they were — virgins at the game.

                                  Since then, he’s written his success rules, creating a global business that has no headquarters, no management structure no corporate identity as it were.

                                  Get the book here!

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                                  Featured photo credit: rawpixel via unsplash.com

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