by Dr Greg Chapman
Business is all about confidence. Confidence that the risks you must take will have a high chance of success. The reason this is essential is that you must provide all the resources (time and money) to make the strategy succeed. Too often, businesses are timid with their actions, and are looking for a 2-way bet.
An example of this was a residential program I attended during my MBA course some years ago. The program was run by 3 university lecturers. Two of these lecturers worked full time for the university and one only part time, and had his own property development business.
Each year they ran a business game for the course participants. The participants would be placed in teams and act as directors of a company in competition with the other teams. As they only ran this program once a year, the lecturers would have a dry run of the game beforehand, the three competing against each other. Every time they did this practice run of the game, the part-time lecturer always won. So this particular year, the two full time lecturers out and out colluded to defeat the part time lecturer, but he still won!
At this point the penny dropped, and one of the two full time lecturers said, that’s why he drives a Porsche and we don’t.
What the part time lecturer did was take risks, just like he did in his business. He did not wait to have all the facts before he made a decision, and when he made the decision, he backed it. Not every decision paid out, but he quickly cut his losses when he saw it wasn’t working rather than obstinately throwing resources at something that was never going to turn around. As he knew he was taking risks, he was also more vigilant in the signs that it was working or not.
The other two lecturers, by the very nature of being full time, were conservative, not wanting to take a decision until they had all the facts, by which time, they had missed the opportunity. They made fewer mistakes, but also made less money.
So understand the risks you want to take, put in place measure to monitor the strategy, and once you take the decision, make a commitment to provide the right effort that success requires. Like the tightrope walker who is halfway across Niagara Falls, turning around and going back to where you came from is not an option. You should have made that decision before you started.
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Dr Greg Chapman is the Director of Empower Business Solutions and is Australia's Leading Advisor on Emerging Businesses and provides Coaching and Consulting advice to Australian Small Business Owners in Marketing & Business Strategies Planning & Systems. He is also the author of The Five Pillars of Guaranteed Business Success and Price: How You Can Charge More Without Losing Sales.
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