Why Winners Take Risks

Decision Making Process, Risk Management

 

Recently, I had the opportunity to talk with Tom Panaggio, entrepreneur, strategic advisor, speaker and amateur race car driver about taking risks, winning, and using failure to propel success. Tom is the author of The Risk Advantage: Embracing the Entrepreneur’s Unexpected Edge.

 

The 2 Big Advantages of Risk

 

“A leader who accepts risk is setting the stage for long term success.” –Tom Panaggio

 

Why is risk an advantage?

 

There are two big advantages to risk.

First and foremost risk is directly connected to opportunity.  Every opportunity must have an element of risk or there will be no benefit.  Risk is the cost of opportunity.  All businesses and organizations must be in a constant state of forward progress because of competition and the ever-changing demands of customers.  Therefore, as an entrepreneur or business leader we must continuously seek out opportunities to meet these demands.  A leader who recognizes the vast importance of forward motion for their organization accepts risk as merely a cost of opportunity and then actively endorses this philosophy throughout his business in setting the stage for long term success.

Secondly because most people have a tendency to avoid or minimize risk, those who have the courage to embrace it already have a competitive advantage.  For example my company was a non-stop marketer.  We knew that our competition was not willing to risk the investment in marketing to the degree that we were.  So we took advantage of their unwillingness to risk the marketing dollars and dominated our market space by out-marketing them.  We put ourselves in a position to win by embracing the risk of marketing.

 


“The only way to achieve success is to have the courage to embrace risk every day.” –Tom Panaggio

 

How do you encourage the appropriate amount of risk?

It is important to understand that my position on embracing risk does not advocate blindly engaging in any and all opportunities regardless of the potential outcome.  But the only way to achieve long term success is to have the courage to embrace risk each and every day.  With that said, there is no standard to determine what level of risk is appropriate, and there is only a blanket rule of thumb that can be generally applied.  That’s the great challenge of being a business leader: recognizing worthy opportunities.  Any opportunity that is void of a sufficient benefit or is described as “no-risk” should be avoided.  Each situation that requires one to embrace risk must be evaluated on a unique basis.

If pressed for an answer, I would say that we always start with the end to determine if this is an opportunity worth pursuing.  What is the reward or benefit the company receives from committing to this opportunity?  If an opportunity provides little reward or doesn’t help with the company’s forward motion, then we limit the amount of risk.  If the opportunity can change the competitive landscape for the company or increases the value your product or service has for your customers, then the level of risk increases by the potential return.

Everyone wants a formula or template they can apply to all business situations.  That shifts the responsibility from the business leader to the formula.  But in the end, business leaders need to rely on their gut intuition and have the courage to step outside the comfort zone.

 

Adapting A Winner’s Mindset

 

How do you adapt a winner’s mindset?

This is really a difficult concept to grab hold of because human nature is pushing us to play not to lose rather than to go for the win.  A study was done and it found out that most people get twice as much joy from not losing as they do from winning.  Lose aversion creates risk aversion: “I don’t want to lose what I have.”

My father was a basketball coach so from a very early age the idea of winning was a way of life. I was conditioned to want to win and, therefore, not only to think like a winner, but more importantly ACT like a winner, which means having the internal drive that says, “I want to win” and then focusing on preparing for competition, execution and moving forward.

 

“If you do not have a winner’s mindset, odds are you will not succeed.” –Tom Panaggio

 

The truth is business does not support the theory of, “It’s not whether you win or lose, but how you play the game.”  In business you not only better play the game right, but you have to win, too. Competition in business has no level of compassion, you either want to win and then act like a winner or you get eliminated.  So if you do not possess a winner’s mindset when you launch a business, the odds are you will not succeed.

 

Using Failure to Succeed

7 Tenets of Taxi Terry

It Started With A Question

 

“Are you ready for the best cab ride of your life?”

When the door slammed shut, Scott McKain wasn’t only taking a cab ride to his hotel.  He was embarking on one of the greatest customer experiences he could imagine.  Not only would Scott enjoy a memorable cab ride, he would exit that taxi with lessons that can make a difference in every business.

 

“Passion without effort equals failure.” –Scott McKain

 

The taxi driver, Taxi Terry, didn’t know that he had just picked up my friend, bestselling author, extraordinary professional speaker, and customer service expert Scott McKain.  Of all the people in the world to pick up at the airport, Taxi Terry picked up a global expert in standing out, in the art of distinction. In fact, he is the Chairman of the Distinction Institute.

 

7 Tenets of Taxi Terry

  1. Set high expectations and then exceed them.
  2. Delivering what helps the customer helps you.
  3. Customers are people, so personalize their experience.
  4. Think logically and then act creatively and consistently.
  5. Make the customer the star of your show.
  6. Help your customers come back for more.
  7. Creating joy for your customer will make your work–and life–more joyful.

 

That simple, enthusiastic question, directed to an exhausted traveler one night was the beginning of a customer experience that tens of thousands of people have learned from. Scott has presented the lessons he learned to audiences around the world.  And the lessons are now available in a new book, one that will inspire you.  7 Tenets of Taxi Terry is sure to be one of the enduring business books that will come up in conversations everywhere (yes, even in a cab!).

 

“If you want your business to get better, the first step is for you to get better.” –Scott McKain

 

Do You Want to Create Memorable Customer Experiences?

At A Tipping Point: The Future of Education

Online Education is Changing the Game

Just over a year ago, I was named the fifth President & CEO of OCLC.  OCLC is a global technology company dedicated to connecting libraries in a global network to share the world’s knowledge.  Part of our not for profit mission includes a research division dedicated to original research on a wide range of topics involving education, libraries and technology.

Cathy DeRosa, Vice President for the Americas, recently released a fascinating market research report about online education entitled At A Tipping Point.  It is free and full of fascinating statistics.  And, online education will not only have implications for education.  It is already having a significant impact on corporate training.

In this brief five-minute interview, I talk with Cathy about the cost of higher education, online learning and the changes in the landscape ahead.

Here are a few facts from the research:

 

Mobile learning.  40% of adults ages 25-35 who have taken an online class have taken it on their mobile phone or tablet.

 

Fact: 40% of adults 25-35 who have taken an online class have taken it on a phone or tablet. @OCLC

 

Convenience wins.  The top benefit of online learning is convenience.  51% cited convenience compared to just 3% citing affordability.

 

Fact: 51% cite convenience as the top benefit of online learning. @OCLC

 

Satisfied learners.  91% of online learners say their goals were met.

 

Fact: 91% of online learners say their goals were met. @OCLC

5 Tips to Avoid a Branding Collision

Car Wreck with a car rolled over

 

A few weeks ago, I was in the middle of a traffic jam.  Not the slow moving type, but the “get comfortable you’re going nowhere type” that shouts, “You missed your morning meeting!”  Realizing that a traffic accident could be to blame, I decided to practice gratitude.

“I am thankful that I am in a comfortable car, safe and sound.  God, if someone is in an accident up ahead, please be with them and provide comfort.”

A short time later, the traffic began to move.  It’s a good thing because I can only meditate for so long before I feel trapped.  I’m sure I was there for at least an hour practicing mindfulness and gratitude, which means I was stopped for about 27 seconds.

 

Accident Ahead

As we moved up, sure enough, I could see what was causing the delay:  an accident.  I did what you would do.  I steeled my eyes on the road ahead and drove without so much as glancing.  Yeah, sure you do.  Trying to keep moving, I glanced ever so quickly to note the vehicles, the emergency responders, and a fleeting view of the injured.  I try not to look—I’ve read that rubberneckers cause numerous secondary accidents—but I’ve also read that looking may be good for you.  Eric G. Wilson, the author of Everyone Loves a Good Train Wreck: Why We Can’t Look Away, argues that it helps us understand life’s deeper meaning.

At the very least, we can tell ourselves that studying wrecks helps us learn from others’ mistakes.

As with accidents, I watch corporate disasters the same way.  Several memorable disasters including Bridgestone’s tire recall, JetBlue’s trapping passengers onboard as categorized by Business Insider.  Anything from the Paula Deen meltdown to Target’s PR nightmare qualifies.

This past week, I witnessed a different type of branding wreckage.  Sure, it may not be as noteworthy as the mistakes above.  It doesn’t involve a consumer brand name, and it doesn’t endanger anyone’s health nor involve racist or offensive remarks.

Still, it provides lessons that are worth exploring.

 

“If you are not a brand, you are a commodity.” –Philip Kotler

 

Platform Confusion

Last week, the National Speakers Association (NSA) announced it was jettisoning its venerable brand in favor of a new name.  That name is Platform.  Though I was not in attendance, I almost immediately was made aware of the announcement via emails, texts and tweets. (See also Rory Vaden‘s excellent post on this subject).

Platform?

It was almost as if I could hear the tires screeching, the glass shattering, the metal twisting.  This was a branding collision, and the onlookers would be gathering to watch.  Why?

First two disclosures:

 

DISCLOSURE #1

One of my close friends is Michael Hyatt.  He is the NYT Bestselling author of Platform: Get Noticed in a Noisy World.  He runs a conference called the Platform Conference and has an online community that will make your head spin at Platform University.  He was the driving force encouraging me to blog.  On the book jacket, you will see my endorsement:

“Michael Hyatt, one of the pioneers of social networking and blogging, shares his successful blueprint for raising your visibility. Learn from his experience and save yourself time, money and frustration by following his step-by-step advice.”