Best, worst and probably

Marty Grunder“The moment somebody says ‘this is very risky’ is the moment it becomes attractive to me.” – Kate Capshaw

I think Capshaw makes a great point for all of us to consider right now. There is so much talk of cutting, divestiture and caution; I fear that the very skill entrepreneurs need to succeed in business is wasting away. There’s not an entrepreneur around who didn’t get to where he is today by taking some risks.

Let’s be clear: I am not telling you to blindly put all you own on the line for an idea just because no one else is doing it. In fact, if no one has done something, there’s a reason: It probably won’t work.

I have often thought about investing in a building that hosts basketball tournaments, soccer games and the like. It seems to blend my love for sports, motivation, kids and business. But I won’t do it; I just don’t think it will work. There’s one in my area that isn’t doing well, probably because people won’t pay the price to make the endeavor successful.

However, I am starting at least one new business endeavor in the next six months because I can start this business for less money than I’ve been able to do it in the past; I can find qualified employees in this environment, and the business is something people need in good times and in bad. So, even though others are in the mode of retreating, I’m going to forge ahead. It comes down to risk management.

What we all need to do is to consider three parts to risk management. Use this thought process in all that you do and I think you will be able to make better decisions.

First, consider what the best thing that can happen is. We can all handle the best thing to happen, right?

The second thing we need to think about is what is the worst possible thing that can happen? Here is where you need to spend some time thinking about what could go wrong if you go forward. What would happen if you lost your whole investment? What would happen if this just doesn’t work?

And then the last thing you need to do is think about what will most likely happen? Be conservative and realistic.
If, at the end of analyzing your idea, you can handle the best thing, the worst thing and the outcome most likely to happen, then you need to go ahead with the idea.

My friend Mark Sanborn told me recently that the secret to success as a professional speaker and author was to focus on generating the best possible products and services I could produce. When you do that the rest takes care of itself. He’s right; quality sells. It always has and always will.

My advice to you as we begin a new year is simple. Look around at all the opportunities and think about delving into some of them. Take some action. Make your new endeavors the best you can. Right now, most entrepreneurs are retreating. Consider expanding. The riskiest thing you could do right now is to not take any risks.