“Cutting your Losses” is not always as easy as it sounds

BRW Q and A 2012I was very pleased to be featured in October’s CEO Q&A in Business Review Weekly.  The questions were quite personal in nature, rather than about the business but did provide a platform to share some learnings which I hope are useful.

BRW Q and A 2012

Probably the starkest lesson I was able to share was what I learnt around my investments in Babcock and Brown as I, like many others, refused to believe it was tanking and instead  continued to throw good money after bad at it. In retrospect I could have analysed the situation much more accurately if I stripped the emotion from the decision. Like the old analogy about hanging onto a balloon before you decide to let go – the longer you are wrong, the worse it gets.  The writing was on the wall for all to see but it is always a difficult decision to cut your losses and admit you are wrong.    But hindsight is of course a beautiful thing!