A leader who oversees a successful organization can often be tempted to stand still – if the ship is sailing smoothly, why change course? While it’s important for any business to stay true to its core values and mission, a wise leader also prioritizes improvement, and innovation is the primary driver of improvement in any organization. New products and processes can transform an entire business. Consider what it would take for your business to raise profitability or enhance company morale. Whatever you imagine, it will involve change. And all change involves a certain amount of risk.
When leaders are confronted with an issue that involves risk, it is essential to weigh all the factors, get the relevant data in front of you, and really think through your options. A few questions to consider:
If I take this risk, what is the upside opportunity?
Can I discuss this with a mentor to help balance my perspective?
Does my organizaton encourage risk-taking?
Is there a possibility I might get in trouble if I take this risk?
Can I handle failure if my risk initiative does not work out?
Business leaders will all confront the issue of risk from time to time. To take the easy way out by avoiding risk entirely is the safe path, without a doubt, but also puts a stop to forward progress. In fact, if you are afraid to take any risk, maybe you should seek a role other than leadership.
The flip side is: a leader who opts to make every risky move available to them chooses to walk a dangerous path. A risk worth taking is one that will yield potential positive outcomes. Any decision-making process that involves risk must be weighed thoughtfully. When faced with issues of this type, carefully consider the pros and cons and if possible, get some counseling from a person you trust. I’ve found it is particularly effective to counsel with friends who work outside your industry as they will likely offer a perspective different from that of your peers.
If the potential reward at the end of your risky decision seems logical and reasonable, it just might be in your favor to go for it . If you take a chance that pays off, your career will likely be enhanced – maybe by a lot. On the other hand, if you take the risk and it does not pan out, you will just have to deal with the consequences. This is a natural part of being a leader, no matter your organization. Don’t allow the fear of failure prevent you from ever taking a leap.
During my time at Tractor Supply Company, we encouraged a reasonable amount of risktaking knowing that many of those risks were likely to pay off, and sometimes in a really big way. Many years ago, a maverick district manager bought a new type of horse feed for a few of his stores – thereby violating the company’s established buying practices. However, his risky buy turned out to be a stunning success and soon became the number-one-selling horse feed in the company. Our maverick got a lot of credit in the end; but he could have gotten in big trouble if his initiative had turned into a failure. That was just the risk he had to take as an innovative leader.
Leaders at every level of an organization will confront matters of risk, from the newest department supervisor right up to the CEO. Elon Musk and Jeff Bezos took enormous risks and saw those risks pay off beyond their wildest dreams; however, just as many risk-taking business leaders have ended up with nothing to show for their efforts. My advice is to study each opportunity as best you can and don’t shy away from the ones that make you feel most uncomfortable. Take a big risk once and a while – that could be the thing to really propel your career forward.
published Nashville Business Journal
