What Separates Opportunity from Risk?
For me, growing up the youngest child came with a huge set of challenges. Courtesy of my two big brothers, I faced daily occasions to show or say that “I might be smaller, but I can hold my own on this proverbial dance floor.”
No matter where we are in the birth order learning to talk, walk, eat, read, ride a bike, swim, and cross the street are challenges that most of conquer as we find our identities. Conquering the challenges of social interactions and the personal particularities of our families, friends, teachers, teammates, bosses, clients, and customers add to the list. We learn those too watching, listening, attempting, adjusting, and eventually mastering.
Most challenges take the appropriate mix and measure of experience, personality, and motivation.
Challenges also motivate by the way they make something happen. They offer a way to gain ground or to conquer new skills and learning. The most exciting challenges are the ones in which risk may be there, but failure simply isn’t considered. On the other hand, taking on an unseen risk can be a ready-made failure.
What separates high opportunity from high risk danger?
High Opportunity, Low Risk Challenges
Long before we get to school, we’ve conquered plenty of learning. All learning is a series of incrementally increasingly difficult challenges that we conquer. We move forward and upward one step, one concept, one skill at time, repeating and relearning at slightly more challenging and more complex levels.
A well chosen challenge — like learning to walk when we’re ready — inspires the determination to scale mountains, ford rivers, navigate detours, roadblocks and fences to reach the ultimate successes. That challenge is a matter of finding success with total disregard to the possibility of failure. Falling down is simply a time to start again. Opportunities that offer sort of scaffolding builds skills, knowledge, and confidence with a possibility of failure but essentially no risk beyond loss of the time involved.
When they’re constructed naturally, learning challenges are high opportunity and low risk.
How to Strategically Pull High-Opportunity from High-Risk Danger
Risk and challenge are not opposite conditions. They often coexist in the same business proposition. We can define high-opportunity challenge as a difficult task matched to our skill set and experience that brings a reward such learning, advantage or new ground with it. If undertaken strategically, risk in that is limited. To limit that risk, we need to understand how gets dangerous.
What is risk anyway?
Risk is underlined and defined by cost. Risk means I might lose something dear that I value. I might give up something I canât recover. I might find I am without something that I love, need, or desire.
The risk is not defined by solely by failure – (unless success is the something dear I value). Defining risk is defining what could be in jeopardy if we move forward.
With the right skills and conditions, the risk of a challenge is lower, but whether we see that depends on our mindset, skill set, personality, and experience. A realistic pessimist who has recently hit hard times might see risk everywhere. An idealistic optimist who has yet to fall down might be blind to the risks of the path he or she is proposing.
A strategic understanding of risk is sounder than seeing risk everywhere or being blind to it.
How to pull high opportunity from high-risk danger
We can mitigate the risk and test the challenge presented by any business proposition by evaluating the key strategic variables. Here’s how to do that.
- Proposition: Define the business proposition in a concrete fashion. Give it measurable parameters — We will release the first offer consisting of [product description] that will [value and value proposition] by [time] to [audience] using [resource] to accomplish that with a return of [expected audience / market / $$ growth].
- Position: Mitigate risk by finding the strengths in your unique position — your size, relative market share, audience awareness, reach, core competencies — and the advantages that come from these. Look for glaring risks in your position that are uncontrollable. Can you turn any of them into working advantages or strengths? For example, if you back is against the wall, you don’t need to monitor or protect that direction.
- Conditions: Lower risk by letting condition support your success. Can you leverage the climate or cycles within your industry to support what you’re proposing? Is there a growing trend that you might align with to increase your growth?
- Benchmarks and Decisions: Lessen danger by building in benchmarks at key decision points. How can you break the proposition into several “go/no go” stages? What is the risk of each one? Can you build an alternate outcome for the “no go” choice at each stage?
- Systems and Relationship Networks: Structure the proposition to ensure scaffolded learning and gradually increasing investment. Can you build your customer base while you build your product or service? Can you test release to build to the customer’s tastes? How do you stage the development infrastructure to be financed by the first releases of the product or with strategic relationships? Set up systems to constant test for the hidden opportunities, and subtle differences from original expectations. See the patterns and respond to them.
Is it possible to risk at 30,000 feet and still fly with a safety net? I don’t think so. If you never risk, you never change. If we only take on low-risk challenges, will we ever learn the art of pushing the envelope, finding the edge of the universe, defining a industry leading purpose?
Find the risk that fits your calling, releases your spirit, and shows you know where you are going.
Would a risk of that nature be a risk at all?
Maybe there is no such thing as high-risk danger when you follow your instincts, evaluate the strategic variables, understand your unique position, leverage the conditions, worry out the secret chances, set up the systems, stage your decisions and incorporate key strategic relationships. The rest is mindset.
High opportunity is about moving forward. A high-risk danger is about not moving backward.
How do you pull high opportunity from high-risk danger?
–ME “Liz” Strauss
Work with Liz on your business!!