When Sir Ernest Shackleton planned his 1814 expedition to explore Antarctica, his help wanted ad reportedly stated:
“Men wanted for hazardous journey. Low wages, bitter cold, long hours of complete darkness. Safe return doubtful. Honour and recognition in event of success.”
Shackleton offered risk – he didn’t promise easy money or carefree times, yet he was overwhelmed with applicants. Today, companies have difficulty finding applicants willing to work for fair wages on safe and clean production lines.
Shackleton’s crew eventually made history (not for their mission’s success, but for their unlikely survival). He elevated a very risky opportunity to the level of a life’s mission, and in doing so, he challenged people to confront their status quo.
Risk is simply a tool, that when used carefully, can enable future growth and success.
When I founded Studio/D several years ago, I was cautioned about the risks involved in starting a company. Financial risks. Reputational risks. Economic risks. Competitive risks. Legal risks. Regulatory risks.
Yet I contend the biggest risk of all is to allow inertia to grab hold, creating “change paralysis,” which kills opportunities and excitement over time. Risk taking and adversity expose you to new challenges and learnings, helping propel you to new heights. The strongest trees grow where the winds blow hardest.
In today’s business environment, rewards go to those who accept well-reasoned risk. So, how can reasonable risk-taking be ingrained into a company culture? We provide six suggestions:
- Position “inaction” as a bigger risk than trying new ideas. Unless your business is simply looking to maintain its status quo, inaction is a terrible risk. When your current standing is viewed as an unwelcome outcome, new risks (called “opportunities”) will appear.
- Encourage well-informed risk taking. Most companies are risk averse (thus training their staff accordingly), so it may take time before your staff fully believes that you are willing to accept failure as a possible outcome. Celebrate successes when the risk pays out, and celebrate learning when it doesn’t. Just keep celebrating.
- Risk diminishes with proper planning, so discuss it routinely. By simply talking about risk, pros/cons will emerge, clarifying the “go/no go” decision. Encourage creative thoughts. Most of us are wired to see risk as a negative, so it’s important to go into the conversation with an open mind, and to encourage frank discussion.
- Dream big. Thomas Edison, Elon Musk, and Steve Jobs all were fearless in their dreaming. They accepted well-reasoned risks, accepted failures with new learning, repositioned themselves accordingly, and made another run for the goal line.
- Wisely limit your risk exposure. We’re not here to encourage foolishness. Don’t be afraid to kill a project when it becomes obvious that it won’t work. Pre-establish thresholds and exit strategies before embarking on the project, removing emotion from the decision process. Set these limits according to your personal and corporate level of risk tolerance.
- Surround yourself with “what if” people. These are people who constantly challenge themselves and others with new thinking, and who have the determination – even grit – to keep pushing ahead when confronted with some level of risk.
At Studio/D, we help our clients define risks, set thresholds and pursue marketing opportunities. Plans are developed based on the client’s own tolerance for risk. Most of these endeavors are highly successful, yet occasionally, they just produce learning.
With our business, we’ve found that if every risk we take succeeds, we’re not dreaming big enough.