The Big Bad “R” Word

August 1, 2008

Risk is a huge factor when it comes to innovation. How you view risk will define how likely you are to be innovative.

There is a certain mindset that the most innovative people in the business world take on. That mindset involves taking risks, making mistakes, and not being afraid to be different and stand out. It is not a popular mindset, but then again, the life of an innovator is an uncommon one.

The mass media and other “noise” has distorted our view of the world by overplaying the idea that mistakes are bad. Most people in business will tell you that the company that they work for demands risk minimization to avoid making mistakes at all costs. This is because a company that makes a mistake is “trashed” in the news, and further scrutinized for other decisions they have made or will make. And most times, the scrutiny will be directed to the top of the organization, no matter what level the mistakes are made at.

Therefore, CEO’s and department heads are less likely to allow any mistakes to be made, even ones that move the company forward. To be innovative, you must be willing to risk your neck a little. You must be willing to do things that no one else is doing, which can sometimes lead to mistakes and slip ups. But without the desire and ability to try these things, how will you ever be able to move forward. I found an interesting blog on “Mistake Policies” that is a good read.

Instead of viewing risk as a bad thing, view it as a necessary part of success. Approach it with the thought that taking risks will lead to further development of the company at all levels. Much more on this to come…

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The Age of the Startup

June 21, 2008

It is easier now than ever before to start your own company.  The playing field is wide open and waiting for your idea.  The barriers to entry are lower than you think, and the startup costs are less than they used to be.  In fact, in most industries, new ways of doings things make the initial startup easier and more convenient than even 5 years ago.

So what does this mean?  It means that differentiating yourself is more important than ever.  The fact that it is easier to start a company means that more and more people are doing it.  To be successful, you need to be doing something that stands out from the crowd.  If you are not different, you are going to get lost in the shuffle and miss out on all of the fun.

Most people are afraid to stand out because it means taking a chance.  It means that if you fail, you fail in the public eye and you will be embarrassed forever.  We have this underlying fear that we will be outcast from society and seen as a fool for the rest of our lives.  Wake up!  It’s time that you realize that if you fail, you are in the majority.  We all fail.  People and businesses fail in this country every day.  Does that mean we all crowd around them and pelt them with cabbage and tomatoes?  There is no public shunning that takes place, and most often these same people or companies come back with a successful venture later.

Get over your fear of standing out, and you will free yourself up to rise to the top.  Get people talking about you because your product is so new, or your marketing is so fresh, or your brand is so simple.  The more people talk, the more opportunities you have to convert them into customers.  Innovation does not have to mean a brand new product that no one ever thought of before.  It can be the way you handle your operations, the way you help your customers, the promotions you offer, etc.  So if you decide to take advantage of the “open” market and start a business, make it worth your while, stand out.


Risk/Reward

June 15, 2008

To innovate is to take the ultimate risk.  It has always been easier for a consumer to stick with something that they know and are familiar with than to switch to something new.  New products have to serve a need that is clear and self-evident.  You have to convince a few people that the benefits of using this new product far outweigh the comfort of using what they already know.  And its not easy.

As humans, we have been conditioned to avoid risk at all cost.  The less risk we take, the safer we will be.  That is why investing your money will never be as popular as savings accounts.  We want to know exaclty where are money is and know that it will always be there for us.  The problem is, most of us are not willing to take the type of controlled risks that we need to take to improve things in our life.

Risk is an important idea to think about, especially if you want to unleash the innovator within.  You could write a whole book on the theory of risk so I will not go into the specifics here.  The point is, we need to look at risk through new eyes.  Examine the possible rewards and see where risks make sense.  You don’t have to be a risky person to take on risk in your day to day life.  If you have an idea for something new, examine the possibilities and if the risk is worth the possible positive outcomes, don’t be afraid to go for it.

Some of the world’s great innovators have risked it all to change the way things are done.  They risk money, status, good name, family, and friends to realize their dreams.  Walt Disney, Steve Jobs, Henry Ford, and Sam Walton are some of the great business minds who took the ultimate risk to change the way entire industries work.  You don’t have to do that.  You just have to have the confidence to take small, controlled risks in order to achieve the kinds of things that you want to achieve.  Change the way you think about risk, it’s not your enemy.  It’s an open door to new possibilities…