Do you take enough business risks? Maybe it’s leaving a corporate job to go after your entrepreneurial dream. It might be getting up the courage to audition for The Voice or (ahem!) pitch on Shark Tank.
Business risks aren’t the same for everyone. Something that is earth-shatteringly terrifying to you might be like a walk in the park for someone else.
But no matter what constitutes a business risk to you, there’s one thing I can guarantee. If you refuse to take any chances, you may not fail. But you likely won’t succeed in the way that you want to, either. That’s true in business or in life.
So, if you’re happy with the status quo, this post might not be for you. But if your comfort zone has become so cozy that it’s painful, keep reading.
I believe that too many people sell themselves short because they don’t take enough risks in business. Sure, you might fall flat if you decide to take a chance. But there is just as much of a chance that you could have a breakthrough, too.
J.K. Rowling said it best: “It’s impossible to live without failing at something unless you live so cautiously that you might as well not have lived at all.”
I’m going to share the case for taking chances. We’re going to look at what could go RIGHT when you take a business risk. I’m also going to show you how to take gambles in business thoughtfully and rationally, so that you tip that risk/benefit ratio in your favor.
So for starters, why would you want to take risks in the first place? What’s in it for you, your clients, and your business to walk a tightrope of potential failure?
Let me share my top three arguments in favor of taking a risk.
- No risk, no innovation. My friend Sean Croxton just launched a new program called the Money Mind Academy. It’s an extensive program designed to help people make more money, save more money, and build long-term wealth. Not many people are teaching that sort of thing, so there wasn’t much of a precedent for this kind of program. But it was also a chance to create something new, innovative, and ground-breaking. So that’s just what he did. And wouldn’t you know it, he filled the program. And it’s already changing people’s lives. If he would’ve decided that the whole thing was just too big of a gamble, nothing would’ve changed in his business. He wouldn’t have charted new territory. Most of all, the people who needed his help the most would’ve lost out on an exciting new solution to their problems.
- Want to be a leader? Take a risk. Not only does risk-taking help you become an innovator, but it also sets you apart as a leader. It positions you as someone who is curious, courageous, and confident, not to mention on the cutting edge of your industry.
- You never know until you try. If you make a pitch, change your business, or start a new program, it may or may not work out for you. But if you take action, you improve your chances of success by 50%. If you don’t do anything, your odds of staying just where you are (and failing by default) shoot up to 100%. Which odds would you prefer? You never know until you try, and there’s nothing worse than living your life in a constant state of “what if.”
But what do “business risks” really entail?
Do you have bet the farm, your life’s savings, or your kid’s college fund to set yourself up for big success? Do you have to do something outlandish and crazy in order for it to “count” as taking a gamble?
Not at all. Risk doesn’t need to be foolish to be effective. There’s a difference between what I call “foolish risk” and “calculated risk.” Let’s distinguish between the two right now.
“Foolish risk” is pretty much as it sounds. It’s those things you do without giving them much thought. The stakes might be high and the chances of success low. There also might be pretty significant consequences if things don’t go your way.
Now, at some point, we’ve all taken foolish risks, myself included. And I bet that sometimes you’ve even come out a winner when you’ve done something outrageous. But foolish risks don’t involve planning, consideration, or care. You just jump in and hope for the best.
“Calculated risk,” however, is about considering that bold move that you’ve been pondering forever, but you’ve never pursued. It’s weighing the pros and cons, doing the research, and making an informed decision. Then it’s about making a plan, taking a deep breath, and pulling the trigger.
So you see, business risks don’t have to be an all-or-nothing, go-for-broke endeavor to be successful. If you take a step back and make a few intelligent and calculated moves, you can roll the dice with a little bit more assurance that the chance you’re taking will pay off.
How do you use calculated risks to tip the odds in your favor? Here is my checklist that’ll help you go all-in with more courage and confidence.
- Do your homework. When those new ideas for products or services come along, don’t sit on them. Start exploring them! That means doing the research. Take the time to look at your market. Make sure that you know who your ideal client is, and find out if what you’re considering lines up with what they want. I’m not talking about overthinking or going into “analysis paralysis.” All you need to do is test the market. Do a little bit of research. And decided how likely it is that your new idea will be a hit.
- Anticipate objections and be prepared to answer them. Whatever it is that you’re contemplating, start thinking about it from the customer’s point of view. What do you think they might ask? What might make them hesitate? Think of as many possible objections, then come up with the answers that will help them see the value in your offer.
- Be ready and willing to pivot your pitch. How do you improve your pitch? Practice it, of course! The more you get out there and talk to people about what you’re creating, the easier it’ll get to present it. And the more you’ll be able to refine that pitch as you go along. Take the feedback that you get and use it to tweak, pivot, and adjust your pitch until it has the optimum effect.
So there’s research, anticipating and preparing for roadblocks, and working on your pitch. None of these need to cost you a lot of time or money. And the feedback that you get will help you make an informed decision.
After that, deciding whether or not to jump off of the cliff is up to you!
Still, keep one thing in mind: no amount of research, honest feedback, or magical sales pitching is a guarantee. There is only so much you can learn before you decide to take a deep breath and go all-in. So don’t get yourself too bogged down in the details before pressing the “play” button. See if you can hit the sweet spot where you’ve got reasonable evidence AND a lot of confidence.
“If you don’t take risks, you’ll always work for someone who does.” ~Nora Denzel, Interim CEO of Outerwall
Make your risks intelligent, but take them! Even if the results aren’t quite what you imagined, you’re guaranteed to learn something. Maybe you’ll take a leap that initially looks like a disaster, but ends up opening the door for a dozen new opportunities. Then again, maybe one small step of risk for you will mean one giant leap for your business. You never know until you try, and the chances are that the worst that could happen is probably not that bad. And one way or another, your calculated gamble just might lead to the most significant break your business has ever had.
Ready to take some calculated business risks, establish yourself as a confident and courageous leader, and become an innovator in your industry? Click here and grab my FREE checklist, “The Calculated Risk Checklist: 3 Ways To Take Business Risks With CONFIDENCE.”
Be smart, be brave, and take a calculated risk today!
