Risk- Taking Ability in Business – Are you a ‘Calculated Risk-Taker’

In our last 2 blogs, we discussed the fear and confidence as integral parts of Business. In this session, we will be talking about one of the most important factors in Business – Risk Taking.

We often hear of success stories of entrepreneurs and businesses who were bold enough to take risks for something which they wanted to achieve. On the other hand, occasionally, there comes a story of a risk going southwards. So how can a determination be made regarding which risk is worth taking and which is not? Not considering the luck-factor, which some may point out as a reason for people’s success, a closer study of behavior pattern reveals that a person can significantly increase his “luck” by understanding the science behind Risk-taking.

Risk-taking can be considered almost synonymous with Business. Substantial growth can come only by taking substantial risks. A high level of decision-making, as well as sacrifice, is required at every stage in business. The question, however, remains if the risk of sacrifice is worth it.

We often come across a term – Calculated Risk. It may be defined as a hazard or chance of failure whose degree of probability has been reckoned or estimated before some undertaking is entered upon. Calculated risk is nothing but forecasting of consequences and deciding whether one can afford the losses if things don’t go according to plan. It is always a simple calculation of whether the profits gained in the transaction are worth the losses incurred otherwise.

Following are a few risks which an entrepreneur is bound to face in his business:

-          Financial Risk: In the end, it all comes down to the finances. An entrepreneur, especially in his early days, must face the risk of managing his money and be ready to incur financial losses.

-          Risk of Employee Retention: Businesses always have a problem retaining their old employees and creating a core group. Also, when an employee resigns from an organization, he takes valuable knowledge about the company with him.

-          Risk of External Competition: As a business, this is one of the biggest risks which can hit a business. To counter this, an entrepreneur needs to always be proactive in his approach and be updated with the world outside.

-          Statutory Risks: An entrepreneur must always be prepared for unforeseen circumstances as well. However, in this scenario, there are most of the times, if not always, indicators about the upcoming changes, what needs to be done is to keep an eye out for the changing trends.

Some risks are unavoidable, where as some can be avoided and played safe. However, for those who are willing to take the risk, the fruits which they bear are way sweeter. To leave you with a thought, there is an old Chinese proverb which goes

“Everybody wants to be a Diamond.. but very few are willing to get cut!”

BUSINESS CONFIDENCE

Confidence comes not from always being right, but not fearing to be wrong.

- Peter T. Mcintyre

Confidence is something which we hear about every day. In a way, it can be considered as one of the fundamentals of the mental state of a human being. Whatever we do, our confidence in ourselves is what drives us. However, What is business confidence? What drives a business to take decisions, risks, and actions based on their confidence?

Business Confidence is something that quantifies the amount of positive energy or optimism the business owners carry of their companies. This quality of a businessman overpowers all the other qualities of successful businessmen. If a businessman is passionate, focused risk taker, but lacks in confidence, he will never succeed. Every activity a businessman performs, be it a product launch, B2B meetings, business decisions need some level of confidence. 

So, if a businessman is expecting a great level of achievement, he needs to be sure about himself that he is worth it. 

Some tips which can help in boosting the confidence :

1.The first impression is the last one: Our appearance plays an important role in building our own confidence. Right from our attire, to our words and conduct, a confident personality leaves a lasting impression on the person in front.  

2.Focus on the outcome: Imagine the beautiful result you are going to achieve. That will automatically drive the process. In your mind, keep telling yourself that the success is meant for you and only you and will come to you automatically. When we focus on our goals, it gives us confidence in our actions and decisions.

3.Small mistakes are acceptable: Always remember that you are not God. We all are human beings, sometimes mistakes are meant to happen. As long as you are able to show a bigger picture, smaller mistakes won’t matter. However, should be kept to the minimum possible. 

4.Have the courage to hear and say NO: It is not possible that you will be able to sell your products or services to everyone you meet. People are going to say NO to you. Let that not discourage you. Always tell yourself that when you hear NO, you are one more step closer to YES. That YES should motivate you to move forward. Similarly, if a person in front is asking for something unreasonable, learn to say NO. No harm. Always focus on the long term relationship

5.Practice: Confidence is just like a muscle. It gets stronger and stronger when practiced. Instead of using it when the need arises, practice in every way possible daily.

However, one has to remember that Confidence is something which can be acquired through focus and concentration as well as through our external support system. Small steps can lead to a metamorphic change in your personality and soar your Business to newer heights.

Failure: A fear faced by most entrepreneurs

 

Doing business is not a child’s play; especially, if you are submerged under the ocean of your own fears.

If you have been thinking of starting something of your own and have not yet succeeded, fear of failure can be a prominent reason for it. For those business owners who may have not yet acknowledged, failure of trying something new could be a reason for the stagnancy that you might be experiencing in your venture.

Be it a small start-up or a big business house, failure is a feeling that most entrepreneur have faced at one time or the other. In this article, let us drill deep down an entrepreneur’s bosom and discover their most dreaded fears.

Failure

What if I fail? This thought has prevented countless entrepreneurs to venture into the unknown. After all, it is not easy to gather all your dreams, hopes, courage and finances - only to see them fail. Failure is the deadliest evil that stops entrepreneurs to innovate. It makes them resistant to change and blinds their foresight. Only if they could overcome the fear of failure, they would know the endless possibilities that lie ahead.

Inadequacy

Are you fighting your own battle of capabilities? Do you think that you are inadequately capable of doing something and this stops you from starting a business of your own? Your inadequacy is in your mind. Let go of it and make earnest attempts to meet your shortcomings; your business achievements shall soon get closer to your aspirations.

Rejection

What if I am unable to succeed? What would people think? Would they laugh at me? The fear of rejection and the inability to handle humiliation prevents entrepreneurs from trying different means or get into a situation which might be beneficial for their businesses. What people think really does not matter till you can hold your head high and walk amongst them.

Separation

Business ventures might not be profitable always. What if mine is not? What if I am unable to earn enough for my family, would they leave me and go? If I cannot match the financial status of my friends, they would stop speaking to me... The unsaid fears of separation that comes with financial risks in business can stop an entrepreneur from taking risks. It is for them to remember that true friends and people who care do not appear and disappear with changes in financial status.

Success

You believe it or not, the feeling of being on top of the game it scary itself. The most successful people face the fear of being secluded and left out. Handling success in the right manner and striking a balance is the key.

Are you confronted with any of the fears mentioned above? It’s time to face it and say goodbye. Contact 9822636600 to know how.

​"Are You Psychologically Prepared for Business??"​

Becoming an entrepreneur or running a business successfully has come a long way in the past decade. Over the years, in my close interaction with entrepreneurs, one thing which I have seen is that business in today's world has grown far beyond the traditional methods and is more focused on overcoming mental challenges and psychological obstacles. The methodology of Avenues which were present, but not studied, have suddenly emerged as an integral part of the daily functioning of businesses. Avenues like Emotional Intelligence, NLP and Business Psychology.

Business Psychology can be explained as the study of understanding the human behaviour and applying it within an organization to help manage the human resource of the organization more effectively. It is a pathway to achieve better customer satisfaction, increased employee productivity and  high-yielding company results. It has shown proven results in almost all cases and has been widely accepted as a game-changer. It has, till date, helped millions of companies globally, to increase their overall performance. 

Business Psychology deals with 62 different parameters of the human personality. There parameters are embedded in one's thinking and behaviour. It is the combination of these parameters which decides a person's mind-set, as well as his capacity.

The psychology of an entrepreneur resonates with the business which he participates in. When the psychological balance is hampered, the effects are seen in the business itself. The common psychological pain points of all the employees in an organization can be addressed to be of a common nature. In fact, the common symptoms and effects of an unbalanced mind is what has come to be the base of understanding business psychology. It has lead to segregation of 62 points which can be used to define and take the necessary measures to stabilize an entrepreneur's mind-set. Some of the parameters are as given below.

• Need for achievement   
• Risk taking
•  Need for independence
• Sense of effectiveness
• Discipline
•  Honor
• Confidence

 

• Social consciousness
• Need for extension 
• Optimistic 
• Open minded 
• Non-fatalist 
• Creativity 
• Curiosity

• Low Affiliation
• Pragmatist
• Aggressive
• Persistent
• Commitment and conviction
• Leadership
• Intelligence

• Capacity to analyse
• Initiative   
• Hopeful
• Efficiency
• Fear   
• Courage
• Emotions

The main challenge in business psychology is to tackle the mind-set of each entrepreneur individually, to provide the desired result collectively, which reflects on the organization's performance. The levels of each parameters are different in different people. 

In our next few blogs, we will be covering all of the above parameters one by one. It is important to understand these qualities in an employee to understand his true potential and capability at work.  An entrepreneur who can master this technique of understanding their customer's and employee's mindset can easily achieve the right balance in his organization.