It is impossible to be both risk averse and aggressive about growth. The two business philosophies simply cannot be reconciled. Business owners shy away from taking risks because they think about those risks as gambles endangering their bottom line: “How much capital could I lose?” However, when owners avoid these risks completely, their business stagnates and plateaus — they lose all upward momentum. If you’re a business owner truly committed to aggressively pursuing growth, you need to rethink risks. Don’t look at business risks as rolling the dice for profit and loss. Instead, reframe your mindset and look at risks as opportunities for growth. Make calculated but bold decisions in pursuit of that growth. Ask yourself: “If you’re not willing to take risks, if you’re not willing to adapt and grow, then what are you doing this for?” This blog post is intended to help you rethink risks and fearlessly pursue growth in your future business endeavors.
Evaluate Your Intention
The first step toward more aggressively pursuing growth in business is to evaluate, and possibly alter, your intention. As a business owner, you take risks in pursuit of a specific business goal. What is that goal? What are you hoping to accomplish? Are you focused on the income you might earn or on the growth and change you might achieve for your business and your partners? Focusing simply on your potential monetary gain is a dangerous mindset. There will never be enough money, and your decisions will be made based on either greed or fear. Instead, alter your intention to be about progress and advancement for your business and your partners. Maintain a focus on following your business mission and serving others with that mission. Evaluate how these decisions will affect others, rather than yourself. You shouldn’t be afraid to lose all personal monetary gain. If you can decisively establish that, in the case of failure, you will be the significant loser without negatively affecting your other relationships, you’ve found a course of action worth pursuing. Framing your intention around this selfless intention and focusing on these broader business goals (rather than your bottom line) will yield better results. Have confidence in yourself, your mission and your intention, and the monetary gain will follow later on its own.
Change Your Perspective
Once you have established your intention, it is necessary to change your perspective on risk taking. Instead of rolling the dice for profit or loss, make calculated decisions in pursuit of a specific business goal. These decisions come with specific criteria. With your intention and end goal in mind, sit down and ask yourself the following questions:
What is needed to follow my intention and achieve my end goal?
If I decide to take this risk, what are the possible outcomes?
If I decide not to take this risk, what are the possible outcomes?
How much time can we afford for this course of action to prove viable?
What are our pain thresholds before we will be forced to abandon this course of action?
There is no reason to take business risks blindly. Think about the possibilities in terms of your intention and goals for growth, and then make a calculated decision. If you can withstand the worst-case scenarios, be aggressive; pursue growth.
Stop Waiting for the “Perfect” Timing
There is no way to know when the “perfect” time will be. If there is such thing as “perfect” timing, the only way to truly identify it is in retrospect. You watch the “perfect” time pass by to a less ideal time and think to yourself: “Well, now is not the right time; we should have done it then.” You will always be able to identify a better or worse time to have taken action as time passes. Reconcile yourself to the impossibility of “perfect” timing and stop using the timing as an excuse to avoid taking risks. The right opportunities won’t fail because of timing. The key is having the patience to withstand the adversity that will inevitably come. Understand the possible negative outcomes and commit yourself to enduring those times. If you can commit to those scenarios, you will survive those times. Eventually, the environment will improve, the timing will come around and your calculated risk will ultimately prove successful.
The following is a personal example of enduring initial adversity to benefit from ultimate success. I took a risk by investing in an old process for a new application. I bought a Nitrogen Generator for Mainstay’s laser cutting operation. I was very skeptical, but the production calculations indicated that it would work. We were expensing about $70,000 per year on liquid nitrogen delivery. The nitrogen generator investment was more than $300,000. I took the risk, and the cash flow savings were enough that I could buy another revenue generating piece of equipment. Here is an example of what might be called “poor timing”: I bought this equipment in 2008 when production was strong. In 2009, we lost 46% of our revenue with the economic downturn. I had a payment commitment where if I had kept to liquid, I would not have the bill from consumption. It was a very challenging year or more before the decision proved advantageous. While this decision might not have been ideally timed, the reward was worth waiting for. It was a decision made in the interests of growth and a risk worth taking.
As a business owner, rethinking risks in this way, in terms of opportunities for growth, can only work to your advantage. If you’re committed to growing your business and progressing your partnerships, use this model to adjust your perspective. With the right intention, this new perspective and a realistic outlook on timing, you will be prepared to pursue your business goals and seek out growth with a new ferocity. Without risk-taking, you may not lose anything, but you will also certainly not gain anything. A risk averse philosophy affects the entire business and places you in a reactionary rut. Taking calculated risks, without self-interest, in the pursuit of growth and progress is the great joy and excitement of being a business owner. Go ahead: be proactive and risk it.