Small business owners, can you relate to these scenarios?
– It’s time to open a second retail store branch—and you fully intend to—but you’re not quite ready yet. You found a possible location but it doesn’t seem perfect, and besides, you’re not sure if the local marketplace conditions are right. Maybe next year would be better.
– Yesterday, you met the best natural salesperson ever. Instinctively, you know she’d be perfect for your team and she hinted that she might be in the market for a job change. You’d love to hire her, but the time doesn’t seem right to hire a new person—money is tight and you’re far too busy to go through the hiring and training process right now.
These hypothetical owners may think they’re just avoiding unnecessary risk. But if you read the scenarios again—and if you’re honest with yourself—you’ll have to admit their reasons reek of excuse making. And here’s the real problem, says author Tom Panaggio: Risk avoiders are also opportunity missers.
“When you’re in charge of running a company, it’s easy to convince yourself that playing it safe is the responsible choice,” acknowledges Panaggio, author of the new book The Risk Advantage: Embracing the Entrepreneur’s Unexpected Edge. “Especially if your business is new, going out on a limb is the last thing you want to do. But risk is needed if you want to do more than just scrape by—and it may be needed just to survive in this economy.
“Hoping that sales will get better or that conditions will improve is the wimp’s approach,” he adds. “You can’t wait for everything to be perfect because it never will be. You have to take action—in other words, accept risk and make those things happen.”
Here, Panaggio helps business owners identify the risk avoidance that may be holding them back by highlighting 5 of its most common forms:
Excuse 1: “The timing isn’t right.” As a young commodities broker right out of college, Panaggio recalls receiving a call from a client named Steve each morning. Steve was, as Panaggio puts it, a “prisoner of hope” who always asked the same question, “Where is gold this morning?” When gold was higher than the day before, he’d comment, “Ah, missed it again.” If it was trading lower, he said, “Let’s wait and get it at the bottom.” Steve missed the biggest increase in gold in over 50 years because he waited for the exact moment to make a move, and based on his perception, that moment never came.
“All over the country, there are entrepreneurs—or wannabe entrepreneurs—who are just like Steve,” Panaggio confirms. “Business plans sit in boxes or on hard drives as their creators wait for the right conditions: funding, free time, better economic conditions. And plenty of existing businesses remain less successful than their owners would like because those very same owners are hoping that tomorrow conditions will be just a little bit better for advancing their goals.
“Also, keep in mind that being a ‘prisoner of hope’ doesn’t just apply to growth,” Panaggio adds. “Besides forgoing an opportunity for success because they are waiting for ideal conditions, many leaders fail to solve problems or correct mistakes because, in their minds, the timing wasn’t right. And when you’re bootstrapping a business, a mistake can be even more costly than not leveraging a chance for advancement.”