How do you teach yourself to take risks in the business world?
Influential people in the field of finance and business say that risk-taking is an integral part of progress in today’s world. But if risk-taking is not in your nature, how can you feel secure as you leap into the unknown?
It took Attorney Binta Nyambi Brown several years before 2013 to get out of the comfortable life she had built for herself as a corporate lawyer, and now she is starting her own business in a market full of similar and challenging businesses.
And before 2105, Brown managed to launch the artistic and entertainment production company known as “Fermata Entertainment” in Brooklyn, New York City. Shortly thereafter, she launched her own record label, BigMouth Records.
Of that experience, she says, “I could have gone on to work as a manager for a record label, and there were definitely opportunities to do that. But there was a particular problem I wanted to solve, and I thought I had a solution. I felt compelled to try to see if I could build something and be successful at it.”
Last year, Brown’s record label took home its first annual award from the US National Academy of Recording Arts and Sciences, and spawned a song that has been streamed tens of millions of times. Her story can serve as a motivation for others who dream of taking similar leaps.
In a world where lifelong employment is a rare currency, the traditional path to work and employment no longer exists in most advanced economies. Does that mean we have to take risks in order to advance? So thinks Bill Ouellette, a lecturer at the Massachusetts Institute of Technology.
Doing things the way we used to do them in an age of uncertainty is really, Owlette insists, “the biggest risk you can take.”
This attitude may be reflected in the way we view risk-takers. Those who are brave enough to jump off a high are valued and respected, regardless of whether it is a good thing or not. In any case, following the safe way of dealing with matters does not make our work attractive or eye-catching.
Would Elon Musk have this prestige among businessmen around the world the way we see it today had he not taken the gamble that made his companies jump at the speed of the rocket after it reached the brink of bankruptcy in 2008, to now become companies such as Tesla and SpaceX that are worth billions?
So, perhaps we should not be surprised to see risk taking become a contemporary global phenomenon. The culture of start-up entrepreneurs, based on the philosophy of “start big or don’t start” or modernization, fostered the mentality that only risk-takers reap the rewards.
As for those who do not seize opportunities, they are on the path of “certain failure,” as Facebook founder Mark Zuckerberg says.
But what does it take to be a risk taker? Is it possible for one of us to turn himself into a risky person?
What makes a risk-taker?
Our ability to seize opportunity, and to be reassured in the face of the unknown or unknown outcome, is affected by our psychological makeup, our physiology, the culture in which we were raised, and the broader societal acceptance of risky behavior.
Researchers have found, for example, that the levels of the male hormone (testosterone) in one of us are directly related to our willingness to take risks. And since the level of this hormone is higher in men than in women, we can often act impulsively based on incomplete information, even though both sexes have the same risk appetite.
“When you prepare for a fight or when you take a risk or risk and it pays off well, your testosterone levels increase, and therefore you become more confident,” says Dr. Tara Swart, a leadership coach and neurologist in London.
On the other hand, when your risk-taking ends in failure, your levels of this hormone drop.
“Your brain will stop you from taking more risks by reminding you of more memories of times when you weren’t so good,” Swart adds.
Our willingness to take risks is also influenced by our own experiences and our individual emotional inventory. Maybe your parents didn’t like to take risks, or maybe you took a risk that didn’t pan out, making you wary when you’re faced with the choice between giving in or holding back.
There are also cultural factors, as you may be descended from a society or a social group that prefers safe successes that do not involve risk or risk in a person’s professional, financial or personal life, over opportunities based on the principle of trial and error.
In some environments, such as California’s Silicon Valley, risk-taking is central to success in the entrepreneurial and founder culture that thrives there.
How do you become a risk taker?
For those who are not natural risk-takers, there are some ways to make yourself feel at ease about taking a risk. And you can, within narrow limits, adjust the psychological reactions that may keep you away from taking risks, by mastering some psychological matters as well.
Swart recommends an exercise she calls “silencing the mind,” which is designed to reduce what she describes as “brain chatter,” by training the brain to be more present and focused.
It has been proven that the behaviors that we do while we are fully focused on them, in addition to living a healthy lifestyle, are effective in controlling the amounts of adrenaline and cortisol, which are related to stress, and are secreted when we are under the type of pressure associated with taking risks or risks.
In other words, mental focus can keep your cortisol and adrenaline levels low, so you stay clear of mind to make smart decisions, including some of the risks necessary to succeed in today’s uncertain world of business and finance.
Reset your thinking
There is a distinct challenge you face when it comes to getting over your past and bad experiences with previous flings. It is sometimes impossible to influence the views of our friends, family, and colleagues when it comes to taking risks.
But what we can change is the way we think about these elements, and our reactions to them.
Dina Goodman is a psychologist and administrator coach who helps senior officials change their “catastrophic thinking” patterns so that they become more willing to take risks.
One example of uncertainty that causes us anxiety is public speaking. If you are asked to give a speech on an important occasion, for example, you may know that this helps to advance professionally, but at the same time you may fear that things may go wrong or disastrous.
But by resetting your thinking, you can learn to become comfortable with this uncertainty and take less weight on the judgments and opinions of others.
“Most catastrophic thinking results from a lack of control,” Goodman says. When we lose control, we try to regain it by anticipating the worst possible outcome.”
We can’t change our past experiences by taking risks that pay off, but we can change how we deal with uncertainties
In the more risky examples, Goodman advises her clients to put their foolish thoughts in writing, then think about the worst that could come out of those thoughts and say: So be it, I don’t care. In the case of giving a speech to an audience for example, you might forget what to say in the middle of the speech, and then what happens?
By looking at each of these fears, such “bad” outcomes can help a person control what seems out of control, Goodman says.
She also suggests thinking about the many possible positive outcomes that could result from taking risks. I’ve found that as people go through this they realize that they’ve succeeded in most decisions that involved some risk, and that they devise backup plans to follow in case they get stuck.
Try taking risks on yourself
Perhaps at the end of the day you need to be willing to put the risk on yourself, to accept that you can make the right decisions, and to adapt to bad choices if things don’t go right.
But it’s worth reminding yourself that risk is almost essential to innovation and progress, says Ouellette. It doesn’t mean taking every risk whatsoever, but rather training your brain to take smart, calculated risks while letting yourself think about what will happen if things don’t go as you planned.
For Brown, this is something she reminds herself of every day. “For sure, this is a very different life for me,” she says. I used to make an excellent income as a corporate lawyer, but going from that situation to becoming a businesswoman, learning to live differently, to make decisions in different ways, was one of the most unusual aspects of my life.”