“If you don’t feel uncomfortable you are not moving fast enough” — Mario Andretti
I participated in a panel today with four other senior leaders to discuss “Risk” with a body of employees at my company. The intent of the discussion was to share how we approached taking risk in our day-to-day jobs. This could come in the form of accepting risk that is a part of a project or taking a risk in the form of pushing a controversial decision. Throughout the discussion there were great perspectives as each of us on the panel spanned the spectrum from risk adverse to risk junkie. There were several points made that I thought would be valuable sharing.
Lean Into Risk
For many, the first reaction to risk is to mitigate it, run away from it, or said more plainly, ignore it. However, what if you changed the paradigm and instead leaned into it and managed your risk. Think about a situation when you had a risk that a valued employee may quite your company. Would you mitigate that employee or manage that employee? Let’s say you decide to mitigate that employee. You may shy away from putting them on the most important projects, as it would be too big of a risk to lose them mid-project. Maybe you decide to hire or task another employee to share the responsibilities of that high performing individual so that if they left, you had a back-up trained. In either case, the high performer will most likely feel like they are not valued because they don’t get the great projects and are asked to give up some of their responsibilities. That simply does not feel good, so they quite anyway.
Now lets say you decide to manage that employee. You start to think about how can you make this employee so happy, they never think about leaving. You assign them the most challenging and visible projects. Invest in their development by sending them to training to learn new skills. Maybe you even consider increasing their compensation. Your high performer most likely will feel special and extremely valued and continue to perform at a high level and be a very engaged employee.
Learn to be Uncomfortable
If you get butterflies in your stomach when you make a tough decision, than you know that uncomfortable feeling. Your palms sweat, your stomach churns, and you body may even shiver. Yet there is a thrill knowing you just made a hard decision, most likely helping your team move forward. For me to be uncomfortable when taking risks, I have to check in with my “True North”. That True North tells me if I am operating on the best interests of my company. If the answer is yes, than I will continue to embrace the uncomfortable. If the answer is no, than it is a sign that I may need to pause and reflect back on why I am embracing this risk. When driving hard, you can sometimes lose sight of the bigger picture. This is why I try to anchor to my True North. For example, if I am going to over spend on a project budget, I better make sure that it is because we are driving more value for our business than what the costs of the over spend are.
Calculate What You Can Lose
One of my peers brought this concept up that true agitators or innovators in industry will calculate what they can afford to lose in taking a risk than what they can gain by taking a risk. The easiest example would be a disciplined gambler. A professional gambler knows the odds of the house in side and out. They know exactly what they may have to lose money to ride out the house odds before they start to win their money back. What they have to calculate is what can they afford to lose if the house odds start to play out? Can they afford $1,000, $5,000, $10,000 to lose or more if they think they could win 2x — 3x that amount when the odds flip back in their favor. Most experienced gamblers who sit down at a Black Jack table for instance will know in the first few hands where the odds lie. They may get up after losing just 2 or 3 hands and seek out another table because they know what they can afford to lose. The gambler who does not give this any thought will keep telling them selves that the next hand will pay out. Before they know it, they have lost all their money.
As you think about the initiatives you are driving, you should pause and think about what you could lose. For me, I often think about the impact to the team (how hard can I push them before they start to burn out), resilience of my customer (can they except good enough or a certain percentage of instability before tipping them to be dissatisfied), or amount of money I can spend before the investment turns into garbage. By thinking through how much you could lose, you have a benchmark that will tell you when the risk becomes just too much.
Taking risks often involves trusting others. This comes in many forms such as trusting your boss won’t fire you for making a mistake. Trusting your team and partners have good intentions and are committed to the success of the overall outcome. Trusting your partners to deliver on their commitments. Finally, it is trust in yourself that your taking risks for the right reasons. Risk can’t be taken on an island of one. You have to bring others long with you if you are to successfully manage the risk. This is where taking risks is hard work. You can’t ignore the impact of your decisions on others. To gain that trust, you must bring others along with you on your thought process and decisions. Not everyone will go with you, but all you need is one or two individuals that will and in turn their commitment may help you validate that taking this risk is the right decision.
This was comment that came from our audience that many companies don’t celebrate failure. This may seem an odd concept, celebrating a negative. However there is great value in celebrating a failure and that comes in giving permission for others to fail. Celebrating failure should lead others to take risks, make decisions, and ultimately accelerate delivery of value back to the company. Another key benefit are the learning’s that take place. These learning’s will lead to better work and business outcomes. Celebrating failure should go well beyond just a project/program team to extend to your users or customers. Bringing them in celebrating failure will broaden your learning’s and teach them how to be resilient as you drive for continuous improvement. If your constituents understand that when a failure occurs, the organization is resilient and nimble enough to address it and correct it, they will be more likely to continue with you on your journey.
How you approach risk is definitely a personal choice. Each of us have inherent, learned or even genetic disposition to how we take risk. Some embrace it, some manage it, and some will even run with scissors right through it. Regardless, you should make how you approach risk an active dialogue with your teams, partners, and leadership. Bringing your approach to risk out into the open will make it less scary to deal with. Not all risk taking has to lead to catastrophic outcomes. Ideally, you learn how to take risk in small increments to drive a larger change.