Risk Taking as a leadership competence
In continuation of my efforts to demystify some of the critical leadership competencies, I focus on the subject of Risk Taking.
Risk Taking is frequently seen as a critical managerial and leadership behavior today. Business leaders and Boards are expecting their managers and leaders to take more risks.
While this need is often well articulated, not everyone is clear about what it really means and if we are all talking about the same thing.
Having listened to a large number of sponsors and coaches, here is what I have understood as the real need around risk taking.
In my view, when organisations ask for risk taking, they are most often referring to the need for their leaders to take “professional risks” and not “business risks”.
In other words, business leaders are not expecting all of their managers and leaders to take entrepreneurial decisions, start new businesses, launch new ideas, commit capital and so on.
They are really expecting them to take risks in the way they carry out their professional work.
So, what would counts as professional risks?
1. At the most foundational level, it is the risk of doing what one is doing in new and different ways – learning and using a new approach, style and method and doing one’s work in new and different ways. It is about moving away from old well-trodden paths and time-tested ways and trying a new approach or embrace a disruptive wave.
2. The second layer is the risk of putting oneself out there and trying or creating something new, outside one’s comfort zone. It could be about volunteering for a new project, a cross-functional assignment, a new initiative, a role in an external forum. It is about stepping sideways. The risk is that one may not like it or one may need to work with unknown people, or do things that one believes one may not like.
3. The final layer is about signing up for significantly higher responsibilities – a new position, a much bigger job, a new city or country or a new role. There might be fear of failing, of one’s track record being tarnished and so on.
As businesses get disrupted and models pivot, managers and leaders need to partake in the risk of doing business only to the extent of making changes to what they do and how they do it and the levels of complexity they are willing to take on.
The question is this: Can risk taking be inculcated? Can individuals be coaches to take more risks?
Absolutely. Enhanced self-awareness is always the starting point, especially awareness of their strengths. Equally, challenging their mind sets and personal truths around risks becomes critical.
Their managers can help in exposing them to small experiments and celebrate failures in the interest of their learning to take professional risks.
