Playing safe vs risk taking

Risks have to be taken to make changes happen in anything you do. In business there will always be decisions with potential for gain or loss, with uncertainty built in. While in theory there isn't any point in taking risks that doesn't pay, there are hundreds of things that need risk taking to make them happen differently in various areas with different decisions for improved results.

Innovation is a big one among it. Innovation is when you look for new ways of doing things, building things or perhaps new ideas being realized as a product.

This means breaking new ground that no one has done before and there are always risks involved. People and companies unwilling to take risks will stagnate with no ability to innovate or change. In the ever changing world we live in today, innovation leads people towards growth. It enables change and opens opportunities that were impossible to see before the change occurred.

Information paralysis

People fear making the initial decision thinking that it may be wrong so they evaluate and attempt to consider all possible options without ever making a decision. There is always more information available and it is easy to get stuck in information paralysis where you do nothing and just continually analyze the possibilities.

A leader needs to have confidence that an early decision can make things progress faster, even if that decision is wrong or needs to be changed later on.

Minimize risks

The risks can be minimized by having options, alternate paths and a reasonable level of consideration, but the decision needs to be made and a leader must have confidence in it to lead others towards that path as well. It's not realistic to expect to have all the information necessary to make decisions.

To beat time and have the edge make the decision when 'enough' information is available.

Comfort zones are everything from a person's daily routine to his lifestyle, to his work environment and habits or roles in life and job. All things that are repetitive and lasting become comfortable and only the new things in life really make things change over time. A decision made under risky circumstances can be sounder when the decision-maker is circumspect and prudent.

But he or she has to know which risks to pursue and which to abandon or modify.

In most work-related situations, probabilities are less precise and more subjective.

They're coloured by a person's past experience, organizational culture, and propensity for risk taking. It's important to understand one's risk taking patterns, one's perceptions rooted in personal and professional history and the degree to which cultural injunctions encourage or deter prudent risk taking.

To what degree do employees think your organization supports prudent risk taking? Some companies routinely question each proposal - whether from marketing, production, or engineering - by asking, "has the issue of risk been addressed?"

Institutionalize risk taking

Some employees succeed every time when leaders want success. But a 100 percent success rate suggests that the employee doesn't take any risks to grow the business, be creative or continually look for change for better returns.

Leaders want team members to stick their neck out far enough and take reasonable risks to grow. Willingness to take risks also means the willingness to step outside your comfort zone.

Anyone who is too afraid to step outside his comfort zone will also be too afraid to take the risks that are often needed as a leader.

Playing safe takes you nowhere with the level of competition you encounter.

If you want to support risk taking, you have to raise your tolerance threshold when your staff or team members miss the mark. Instead of blaming them, ask them what they learned from their 'failure' and make sure you communicate to them that you realize that falling short of expectations is inevitable from time-to-time.

When employees feel vulnerable, it fuels risk avoidance.

Some companies institutionalize risk taking in its performance review process. Such actions assure that risk-taking is embedded in a company's culture. Most importantly, organizations need, by word and deed, to encourage employees' innovation, reward creativity and not punish occasional failure.