Do you remember the days when Hi5, My Space, Pagers, Ericson and even the legendary Nokia 3210 used to be so cool? These companies were leaders in social media and how we connected with the world. Sadly, what remain to some of these businesses are just the memories. Their failure to take risks is the very reason they became stunted. This too can happen to you and your business.
Naturally people tend to be risk averse. The idea of taking a risk is about having to letting go of something you are certain of and reach for the unknown. Despite how successful someone is, we are all wired to be risk averse. It is easier to find comfort with status quo. The likelihood to be risk averse intensifies when there is a threat to reputation, money, social standing and pride.
Business environment is constantly changing so too does the market forces, consumer preferences, technology or even the political environment. In business it is equally a risk to fail to take a risk and many small and big companies have lost market shares because they fail to take a leap of faith. Social media is one sector that has seen previous big businesses lose market share or even get out of business.
When confronted with situations, you need to take cognisant of the fact that there are two types of risk designated by best- and worst-case outcomes or consequences: intelligent risks and moronic risks. Taking all your profits and gambling them is a typical moronic risk. You have a higher chance of yielding profitable results when you take on intelligent risks.
When the families of the Changer Space Shuttle Crew said “Do not fear risk. All exploration, all growth is calculated, Without challenge people cannot reach their higher selves. Only if we are willing to walk over the edge can we become winners”, there were spot on.
In business you cannot allow any naysers, or your inside inhibitions to dictate how you respond to risks. Often, letting your fear of failure or what others outside your business say can stop you from becoming a successful business person.
I have been averse and I am worried this might be hampering my business, how can l avoid being risk averse?
- Use realistic assessment tools that doesn’t magnify risks or cloud your judgement
- Avoid dramatic worst case scenarios
- Be sure to appraise your abilities because you can handle the consequence of risks
- Consider the full continuum of the cost benefits of taking risks, don’t just look at the cost and ignore the impact of failing to take risks
- Take a leap of faith and be the first to test the waters, you could actually be the one to bring the much awaited disruptive technology.
Bear in mind that the very day you decide to start a business you are assuming a risk; you either borrow or use savings that can all be lost. A failure to take appropriate risks can see your dream crumble. As an entrepreneur you should always look at the brighter side and the greater possibility of success.
You need to understand that we live in an ever-changing world. A retrospective analysis of business trends in the past years will reinforce the notion that the biggest risk in any business is that of not taking any risk. Yes, some of the changes might call for harnessing of new ways of doing business that might seem costly today but you have to bear in mind that the cost of inaction will result in you getting out of business. A business that remains the same is likely to be less competitive and unappealing. Don’t let your initial effort go to waste because half down you are now too averse to take the next leap.
Always remember to achieve your dream and build your business empire, you have to consider taking measured risks. If anything there are real benefits to taking risks;
- Wherever there are opportunities, there are risks. By taking risks you are exposing your business to new markets and opportunities.
- When you enter the unknown your mind grows. You find yourself learning new ways of doing things, harness new techniques and problem-solving skills.
- You can actually identify what your business is about by taking risks.
- There is an element of freedom associated with taking risks making you break away from average business performance to reaching your pinnacle.
The dictates of the changing business environment follows that you have to continuously give up something and take risks to keep moving forward. Unfortunately you can’t pre-occupy yourself with what if questions if you are determined to succeed. The quote by Alan H. Olmstead gives you the more reason for taking risks, “Failure is always a safe, familiar, no-risk refuge, a known experience; it focuses on testing no new responsibilities upon one. Success, on the other hand, is unknown territory and a high-risk business; the very life-style it imposes if full of relentless demands for even better performances and achievements.”
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