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Message: <blockquote data-quote="Croesus" data-source="post: 5925829" data-attributes="member: 35019">For some reason the forum won't allow me to edit my earlier post, so here's a follow up.You seem to be saying the university should not have hired staff using gains from their investments. That would be Avoidance - they are avoiding the possibility that a negative event would require layoffs. But wait, hiring those staff may increase revenue to the university, boost its reputation, facilitate additional donations, and so on. By not hiring those additional staff members, the university may still have to layoff staff at some point in the future. Instead, the university could choose Insurance (deflecting the costs of the negative event to the laid off workers) and Mitigation (ensuring that remaining staff are properly trained so they can fill in any critical roles of the laid off workers). If you assume that Avoidance of a negative event is the only appropriate standard for managing risks, good luck to you. The real world has risks no matter what you do. You can't avoid all bad things, no matter how smart the person or management.</blockquote>