Change Leadership Secret – 83 – Big Success = Big Risk

Change Leadership — Secret # 83
Big Success = Big Risk

I believe that one of life’s biggest risks is never daring to risk.
—Oprah Winfrey

What I Need to Know

Unless you have a phobia like I have that reality television shows will irreparably kill my brain cells, then you have probably seen The Apprentice with Donald Trump. On the show, ambitious young workers compete for a job in Trump’s empire. When competitors are eliminated, Trump points his finger at them, purses his lips, and says, “You’re fired!” Donald Trump has become more than a real estate and gaming executive; he has become a bigger-than-life business mogul icon. How does he do it?

Of course, his self-esteem and self-promotion are legend. Those are definitely keys to his success. But by far the biggest key to his success has been his risk taking. Every few years, he seems to go bankrupt under billions of dollars of debt, and a few years later he is a billionaire again. This willingness to take billion-dollar risks is what makes him a billion-dollar success.

In change leadership, both the changes and their risks are borne by the client. The change agent’s role is to provide objective, unbiased information to the client about the benefits and risks associated with change options. Furthermore, the change agent’s role is to assist the client in eliminating and mitigating risks to ensure the change is successful.

But ultimately, the change agent has the highest value if he helps the client make the changes that produce the biggest successes.

What I Need to Do

Even though the client owns the change and the associated risk, you will be sharing in both—assuming you are an astute negotiator. So you must share similar values regarding risk tolerance and opportunity cost. For example, let’s say you want to be a supplier to an auto manufacturer whose product life cycles are ten years, including three years of development. If you are not prepared to invest for three years before you begin to see revenue, you will not be able to play in that game.

Perhaps one of your biggest challenges is not convincing your client, but rather convincing your own company to take risk and play in games with bigger purses. Either way, you likely won’t have much influence over their risk tolerances. Your best strategy is to become a risk management quasi expert and reduce risk as much as possible. For example, the Project Management Institute offers many great publications such as Project Risk Management Guidelines: Managing Risk in Large Projects and Complex Procurements, and even offers certification in risk management.

Action Summary

  • Think big – and then manage the associated risk.
  • Make sure you and your client similarly value risk and opportunity costs.
  • Make risk easier to swallow by reducing it as much as possible.
Change Leadership Secret - 83  Big Success = Big Risk

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