Two Steps To Help You Become A More Confident Risk-Taker
When I am speaking to entrepreneurs or leadership teams, I always ask them the following question:
“What is the first word that comes to your mind when I say the word entrepreneur?”
95% of the time I get the same exact answer: Risk-taker.
When I go on to ask the audience how many of them are risk-takers, the percentages drop quickly—even amongst the entrepreneurs.
Then I ask another question:
“Is a military jet pilot a risk-taker or not?”
How would you respond?
The audiences I speak to typically split on this answer. Some say yes and some say no.
But then, if I add the word “controlled” to the equation, everyone invariably comes to the same conclusion. Everyone shifts to a yes.
Everyone agrees: a military jet pilot is indeed a controlled risk-taker.
So how can entrepreneurial leaders use this information to become more comfortable and confident taking risks? And how can they learn to take smarter risks?
By taking these two steps.Entrepreneurs are well known risk-takers. Click To Tweet
Step One: Change the wording from risk-taker to controlled risk-taker.
Entrepreneurs are well known risk-takers. In fact, many people deem them crazy. Many say you would have to be half-crazed to start a business in today’s unpredictable economy.
But allow me to change the dynamics a bit. What if I surrounded you with some great business advisors as you grew your own business? People who really know the field. Would that make you more comfortable with the thought of joining the entrepreneurial ranks? Would you feel a bit more in control? Would you maybe even get excited about the prospects?
Next time you find yourself saying “no” to a potentially risky decision, ask yourself what you could add to the situation to make it more controlled, and to increase your desire to jump in.
Step Two: Go beyond your gut instincts, especially if you don’t consider yourself a risk-taker.
Let’s be honest: would you feel safe buying your significant other a cubic zirconia when you knew she was expecting a real diamond? You might convince yourself that what you bought is indeed highly valuable, but it will never be the real deal. There would always be the risk that, in the future, she would find out the truth, and your investment would sour quickly.
In a previous Forbes article titled “The Entrepreneurs Road to the Diamond Mine,” I introduced the following chart which takes into account your intuition—or gut feeling—as well as data and metrics.
Unwisely, a high percentage of entrepreneurial leaders run their business with the cubic zirconia philosophy: trusting their gut and ignoring the data they have available to them in their business.
Sure, they know the bottom lines of revenue, profit and cash, but there is so much more available to them that would help them make better decisions. The entrepreneur has pure gold in the form of metrics. The answers are there, if they choose to do the work and mine their data. Then, if they combine their intuition with the insights gleaned from data, they can elevate their decision-making to the true diamond level.
Risk-taking shouldn’t feel like you’re getting CZ when what you set out for was a diamond. Take off the blindfolds and start controlling your risk better: Use data and metrics to mine your organization for the real deal. This is how you go from being a “half-crazed” entrepreneur who leaves the future of their enterprise up to chance, to one who operates his or her business like a military jet pilot. Armed with data and strategy, you’re now a controlled risk-taker.