The great business leaders didn’t get to where they are by sitting back and letting things happen. Somewhere along the way, they had to take risks, and bet that they had the right ideas, attitude and product to succeed.
So those who are new to leadership positions may find themselves with a quandary when faced with a major challenge. Their instinct may be to play it safe, a conservative approach that will avoid abject failure. And in some cases, that may be the smart play.
But inevitably, for a company to make progress, its leadership will have to break out of that pattern. That’s not to say a reckless approach is wise. But taking a smart risk could pay huge dividends. Here’s a look at a few reasons why.
It can make the difference between success and mediocrity.
Business leaders that avoid risk may find themselves missing out on major sales and expansion opportunities. And it’s hard to follow someone who won’t take a chance every now and then.
As Drew Hendricks writes for inc.com, “Risk-taking is a necessary part of any business model. Without it, little is accomplished and customers quickly become bored with your product, service or program. Not only does risk open up the door to new possibilities, but it also shows your audience the firm genuinely cares about the industry and users of its product. For a business, risk can uncover new markets, new audiences, and new capabilities. Risk forces leaders to set aside their fears and take strides toward future success. Many people are tempted to give in to the voice in their head that says, ‘this isn’t the right time’ or ‘this didn’t work last time.’ Learning to move past such insecurities will lead to new levels of success.”
It tests your limits.
It’s hard to know what we’re capable of if we never challenge ourselves. Taking a risk means being bold and aiming to break new ground. Stacia Pierce explores this in a piece for The Huffington Post.
“We all have boundaries or a comfort zone where we’d like to stay, and many have misconstrued visions of what we think we deserve or are capable of accomplishing,” writes Pierce. “When you take risks, you can eradicate that thinking, establish new boundaries, improve your outlook on life and your ability to achieve on high levels.”
It helps to conquer doubts.
The fear of failure may be a real and intimidating hurdle, but a business leader will need to get past that — and fast. Knowing that the road may be bumpy, and preparing to take on those bumps, will help a risk to become a success.
As Hendricks writes: “Before executing any plans, prepare for errors. They are an inevitable element of risk-taking, and key players in business must be mentally ready to handle the consequences. Accept the possibility of total failure, and develop creative ways to handle it, should it happen. Realize mistakes indicate the presence of risk, which means the company is at least moving in a new direction. Mistakes are a natural part of the process, and learning to handle them gracefully is just as important as taking a risk in the first place.”
It can provide clarity.
Sure, you may have a list of goals in your mind, or maybe on a dry-erase board, or even a sticky note attached to your computer. Can you achieve those goals by playing it safe, or do you need to consider a gutsier move?
As Pierce says in her story: “Calculated risks are taken with careful thought. Yet the fact that you are taking a risk pushes you to make things work. Surely you will first have to determine if the reward is something you really want enough to take the chance. If it is, then move ahead and don’t look back.”Business & Finance Articles on Business 2 Community