WHY RISK TAKING IS IMPORTANT IN BUSINESS
2 MIN READ
Now perhaps more than ever before, successful business ownership involves taking risks. If you don’t embrace risk-taking, you may want to rethink being an entrepreneur.
A lot of small business owners have taken risks to get their businesses to where they are now. Taking risks, however, does not mean going into business blindly and then expecting great results. Taking risks in entrepreneurship involves careful planning and hard work.
Today, we take a look at the reasons why risk-taking is essential to small business owners and entrepreneurs:
YOU WON’T BE LEFT WONDERING IN FUTURE
Nobody can really be sure if risks will pay off, no matter how calculated they may be. But this should not stop you from taking risks. If you want your business to succeed, risks are necessary. You should never be left wonder what could have happened if you had dared to jump in! According to a quote by Frederick Wilcox, “Progress always involves risks. You can’t steal second base and keep your foot on first.”
“When you take risks and they work out, they lead to new capabilities you never saw before.” Tom Soderstrom
YOU LEARN FROM TAKING RISKS
Some risks may not pay off, but an optimistic risk-taker will always look at failure as an opportunity to learn. The willingness to experiment with new ideas is key to business growth. As Michael Stelzner puts it, “Nothing ventured, nothing gained.”
Failure will teach you how to think and plan strategically. Just remember that not all risks are good ones, and when you fail, learn from it and move forward.
INNOVATION CANNOT HAPPEN WITHOUT RISK
Innovation involves changing how people do things. It is about sharing and teaching what we know and putting new ideas into practice.
Innovation cannot happen if you will not accept the risk that your undertaking might fail. The level of risk may be lessened, however, if you make all possible calculations and evaluate which option is best before proceeding to the next step.
RISK IS DIRECTLY CONNECTED TO OPPORTUNITY
Customers have constantly changing demands. For this reason, businesses should be in a constant state of progress. The astute business leader is in tune with what their customers need. Their finger is on the market of shifting trends and market demands. And they are innovative responders who operate by prioritising continuously evolving ways of taking solutions to market.
Business leaders recognise this, accept risk as a cost of opportunity, and then validate this attitude within their organisations. This helps greatly in realising their goals and achieving success.
THOSE WHO TAKE RISKS HAVE A COMPETITIVE ADVANTAGE
Since most people tend to avoid risk, those who are brave enough to take risks already have a competitive advantage. They are the ones setting the pace and leading from the front with new ideas, fresh offers, bold inventions. Risk takers are the most adept at pivoting when the going gets tough.
Simply put, when most individuals stay away from risk, that means less competition for risk-takers.
Can you achieve what these risk-takers have achieved? Maybe, maybe not. But for as long as you want to stay safe and for as long as you are content with where your business is right now, you will never find out.
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