Example A: John has owned his own print shop for several decades, during which time he has enjoyed much success. The newest technologies, though, could increase John's clientele and speed at which he delivers his goods to existing clients. John, though, is thoroughly risk aversive, concerned about expense of expenditures that would follow incorporation of latest technologies, and therefore, John does not incorporate them. As a result, he has lost some existing clients and many times fails to add new ones, effectively hurting his bottom line.

Example B: Miriam owns her own real estate company and does very well with it, employing ten people. Miriam feels need for new challenges however, and decides to buy several investment properties herself. The properties she buys are extremely expensive, and need much upkeep. In order to purchase them, Miriam borrows "against" her existing business, using that as collateral for loans she must acquire. Within mere months, Miriam experiences several major repairs needed on each of newly acquired buildings. She then must borrow yet again to afford these, and finds herself going deeper and deeper into debt. It becomes a struggle finally, to even "hold onto" original business, as she now owes enormously to several creditors.

As you can see, John, is much too risk aversive, while Miriam failed to take into consideration many difficulties that could occur with large-scale expansion of this sort. Neither is correct in their assessment or approach to risk management and each has hurt their own businesses as a result.

The old adage, "Slow but steady, wins race" really applies significantly to business and appropriate risk management within a business. Business owners should plan thoroughly and weigh their risks completely before proceeding with any new venture or expansion. However, businesses also need "planned growth" throughout given periods.

Business owners need to use their judgment wisely at all times, and use it well, when considering appropriate risk management techniques.