“Of course, there is no such thing as a riskless strategy.”
— W. Chan Kim and Renée Mauborgne, Blue Ocean Strategy
If you want things to change, you have to try to change things, and that entails assuming the risk that things might not go the way you want. Every plan is a guess about the future, and sometimes our guesses are wrong.
But that doesn’t mean you shouldn’t take risks. Because the only thing you can ever truly guarantee is failure—and that’s by trying nothing at all. Risk is not just inevitable, it’s necessary for any hope of success.
So the only thing to do is prepare for the risks, consider the mostly likely possible outcomes, and create a strategy that can adapt to changes. And that requires calculating your risks.
Making the most of risks
Start by running a premortem on your strategy to come up with all the most likely ways it could go both wrong and right. Remember that just because you know the possible upsides—the reasons you created the strategy in the first place—that doesn’t mean you’re currently aware of what could go wrong. A downside could be hidden in an upside, like overwhelming demand that floods your customer service.
Dig deep into your scenario planning, and broaden your perspective. Ask yourself questions like, “How would I respond if our competition did this? Will my suppliers be happy I’m doing this, or upset? Am I doing this to please my current customers, or to grow into new audiences? Does someone lose if this succeeds, and could that backfire? If this succeeds beyond our wildest dreams, are we prepared to fulfill that demand?”
You can give yourself more room to maneuver by making your strategy adaptable. Focus it on the things within your own control—like your effort, your resources, and your critical thinking—instead of things outside your control—like upcoming events, market swings, or technological innovations.
Your strategy shouldn’t require the future to go one particular way for you to succeed. As Hart said, “A plan, like a tree, must have branches if it is to bear fruit. A plan with a single aim is apt to prove a barren pole.”
I know that considering the risks can sometimes feel paralyzing, but it’s worthy work. Once you have a good sense of the upsides and downsides, you can make decisions about how to maximize and mitigate them. And that will give you more confidence that you’ve made the right decision.
And that, in turn, will give you extra drive to see your plans through to the end so that you can truly get what you want.
To stay motivated, balance considering the risks with the ambition to succeed. Temper it with the drive to not wait for circumstances to change but to change your own circumstances.
And remember that action is sometimes the best source of information.
As FDR said, “We have to do the best we know how to do at the moment. If it doesn’t work out, we can modify it as we go along [...]
But above all, try something.”