“Take calculated risks. That is quite different from being rash.” – George Patton
Managing risk is a critical part of any leader’s job. It’s important to understand the risks that are potential threats to your business, how severe they are, how likely they are to occur, and whether you have any systems in place to help you detect or anticipate when those risks might be on the verge of reality.
But don’t confuse managing risk with eliminating risk. Too many leaders spend time doing one of two things. They either spend countless hours and resources attempting to make ongoing activities and initiatives free from risk, or they refuse take on any new challenges unless they can be certain that there is no risk involved.
There is no such thing as ‘risk free’, unless you’re also looking for ‘success free’. All success involves at least some degree of change, and no change is without the potential for trouble. There could be problems with people, customers, competitors, the government, the economy, the weather, technology – there is no end to the things that could potentially go wrong.
If you really want your business to succeed, especially in today’s environment of rapid change, then you have to be comfortable with risk. You have to be able to sleep at night knowing that there are certain things that could happen that would mess up your plans.
That doesn’t mean you do nothing to mitigate risk. That doesn’t mean you just adopt a ‘whatever happens happens’ mentatlity. You will have an impact on how things turn out and you need to be intentional about doing whatever you can for so that your business can succeed.
Just don’t be so risk-averse that you refuse to try new things, refuse to think about old things differently, refuse to leap into new worlds. No business that refuses to embrace the unknown will survive. Don’t be foolish, but don’t convince yourself that only fools take risks. No business has ever been successful without taking risk, so identify what that looks like for your business and get going.