This week we have been talking about fear and failure. We discussed that the reason why most people fear venturing into a new business idea is because of the fear of failure and we also discussed how to deal with it. Today we will talk about risks.
On Monday, we talked about fear and in that story was the story of Christopher Columbus as he sailed through the seas. Let’s think about that story today. In those days, there were no GPS, there were no maps and they didn’t know where they were going. They were just going that way. Some of them thought that way was India and others thought it was the end of the world. Come to think of that, there was a great deal of risk associated with that venture if it was the end of the end of the world. The reward however, was greater than the risk and that was what motivated Christopher to head that way.
We are faced by many types of risks everyday as we go through our businesses. Should we leave that steady employment and go out venture in our own businesses? Should we add a new product to the product line? Should we do away with a product from a product line? Most of us will avoid risks they have a fear of failure. We talked yesterday that failure is just the tiny adjustment you make to your course while driving a car. It is a minor a minor adjustment on your way to success. If you learn to look at failure this way, you will get to an even higher destination. It ceases to be this big thing that you are always afraid of.
Now that we know what failure is and why we shouldn’t fear it, we can now navigate through all those risks including the biggest of them all which is the risk of failure. Now you can look at the opportunity you have been sweating over and assess the risk and strike out. The reward you are going to get is much greater than the cost associated with accepting the risk.
[Full Transcript Follows]
Hey there folks, Thom Rigsby here from thomrigsby.com. This week on 7 Minutes in the Morning, we’re talking about risk and reward. Today about risk but sounds like a good topic. Stay tuned, 7 Minutes in the Morning is coming right up.
Hey there folks, good morning and welcome. You have found 7 Minutes in the Morning; it’s your daily dose from your business coach, that’s me, my name is Thom Rigsby. Our goal here is to take one topic and explore that topic every day, seven minutes or less, so that you can build a better business. Last week, we’ve been talking about fear and failure. Today we’re going to get off of the words with start with the letter “F” and move on to word that start with the letter “R”. Today, we’re going to talk about risk. On Monday I talked a little bit about fear and in that story was a story of Colombus – Christopher Colombus – as he sailed from Spain or Portugal or wherever he left from. There was tremendous amount of risk associated with that venture. In that day, think about it, there’s not GPS, they didn’t have a map of where they were going. They were just going that way. What’s that way? Well, we don’t know, some people thought it was the end of the world, some people thought it was India.
But tremendous amount of risk associated with that, if it was the end of the world, because you can just fall off the earth and never come back. But the reward was even greater the reward and that’s what motivated old Chris to head that direction. There’s a great story that I’d tell about risk and reward that comes from Donald Trump. He was being interviewed on a side walk-cum-venue and he was asked is there a good time to start a small business and in the background of a hot dog vendor. They walked over and talked to the vendor and said “How many customers do you serve a day?” and he said “Aaah, three or four hundred.” He said this guy is going to make three or four hundred people mad before he loses his livelihood. How many people do you have to make mad? See, if you look at it in those terms, the risk of leaving a steady employment that everybody else says is a good thing, to go out and strike on your own can sound astronomical.
When we think about risk in the terms that everybody else says “Ah, you don’t want to do that, you’ll loose your insurance, loose your vacation day, you loose this and that or the other. Yeah, but think about what you could gain. Most of you have already overcome that obstacle or you are in business for yourself, you understand the value of striking out on your own. But what are the risks that you face on a day to day basis? Should you add a new product to the product line? Or the one that I say is even scarier than that, removing a product from the product line. Yes, people buy it but it’s taking up [an inventory space, it’s not a high margin item and not a lot of people buy it. Should you really keep it? Yeah, but…maybe somebody will buy it and I’ve already got it here. There is lots of ‘maybe’ analogies, I won’t give in to all of those.
The story today is about risk and learning to take a risk. Most people avoid risk because they have the fear of failure. When we talked on Monday that fear is a good thing, it causes us to pay attention. We talked yesterday that if you look at failure it’s just the tiny adjustment like driving a car, the little bitty adjustments you make to your course, you get to an even greater destination. If you were leaving your neighborhood and your car was in the wrong vector and you were heading off into the trees and you just decided to stop there on the side of the road and say, “I’ve got air conditioning, I’m not too far from home, I can walk back, will just stay here.” Oh men, what a missed opportunity. Risk is that balance that you have to do between the potential bad that can happen and the potential good that can happen.
Failure: If you look at failure as those tiny little adjustments, then it’s not this big thing that you have to be afraid of. You only fail when you quit and you are not going to quit – I know you’re not because you’re on my list and I won’t let you. When we talk about risk and the biggest risk that most people assess is the risk of failure. But now we know that failure is just a little adjustment that we need to make on the road to success, and we have no reason to fear. Now we’ve mitigated all of those risks. So now look at the next that the opportunity that you’ve been sweating over. It might be leaving a job to strike out on your own, it might be adding a product, it might be taking a product away. You might be getting into a joint venture or bringing a partner on. Look at that opportunity and assess the risk now.
Now that we know that failure is just a minor adjustment, now the risk doesn’t look so bad anymore. Go ahead and strike out. Go ahead and take on that partner. Go ahead and enter into that JV agreement because the reward that you’re going to get – we’ll talk about that some tomorrow – much, much greater than the past associated with accepting a risk.
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Alright, that’s it for today, we’ll be back tomorrow taking about rewards right here in 7 Minutes in the Morning. Until then, my name is Thom Rigsby and I’m your business coach.