Playing it a little bit unsafe
Ever look back and wish you’d spoken up? I remember times when it may or may not have helped. It would, however, have been good for me. You tend to take on some shame when you hide. It’s the opposite of empowering.
You see this in business disruption. Things are ticking over pretty well but you know it’s changing out there. An alternative product might make sense. Trouble is, you don’t want to mess up a good situation. You hang on to your current offering for fear of cannibalising your success.
All, nothing or a bit
Ride-sharing apps are hugely convenient. Rather than depend on a phone operator to find a cab, you can see where the nearest one is, how long it will take to get to you and how much it will cost to get where your’e going.
The technology behind them is not particularly sophisticated. Uber knew that. Early fundraising was aimed at rolling the thing out as quickly as possible, before other startups could get traction.
Taxi companies could have outsourced to a bunch of geeks to build a similar app in a month or two. It wouldn’t have been that expensive. Just another tweak to their service. Instead, most of them holed up behind a regulatory wall.
What can you do about it?
Baby steps help. They take you to the coalface where you can create change. Booking a cab is only one element in managing a taxi service. You don’t have to revolutionise the entire operation. Just identify one step in the supply chain that takes your product or service from raw material to customer and make it better. When you’ve done that, work on another.
Nassim Taleb, in The Black Swan, states the obvious: you have no idea how anything is actually going to work out. He calls on management to apply a ‘barbell’ strategy, that is, to build a business with a solid core but put risky weights on each end that take some chances.
How much risk?
I applied Taleb’s thinking to an investment portfolio. Eighty percent was made up by income-producing assets. At one end, I put 10 percent in well-researched growth propositions. They went okay. At the other end I put 10 percent in high-risk gambles, mainly angel investments in startups. Most didn’t go okay, but they led me to places I would never have gone and to opportunities I would never have seen. Most importantly, they kept me current with changes in the marketplace.
Taking a few chances keeps your business and life moving. The heart of risk management is not necessarily sophisticated hedging strategies and diversification theory. The key step is making a conscious decision about what level of risk you are prepared to maintain. Some is mostly better than all, and invariably better than none.