Risk Taking - whose risk is it?
Note: Today’s post comes from my friend Clive Steeper. Clive is an executive coach, performance consultant and facilitator, working globally with many organizations ranging from international corporations to fast-growth businesses.
In a recent conversation a C-suite Executive was explaining to me how their business
had a great opportunity to grow significantly however the 'window' of time for the opportunity was short as competition would catch up very quickly. Therefore his organization would need to 'learn to take risks' if they were to make any real gains.
When I delicately enquired if by organization did he include the C-suite leadership team I got a rather stern look and short response! - "what do you mean by that question?” he enquired.
"Why is the organization not taking risks now?" I replied.
The ensuing conversation led to a realization that in an organization a risk can, and often, will be viewed in many different ways. People do not all have the same beliefs and certainly by tint of the differing roles and responsibilities in an organization everyone does not have the same information, visibility and circumstances.
Leaders in an organization set the tone and pace for the cultural climate. Depending on how leaders use curiosity and conduct themselves will, to a large extent, shape the team that work with them.
Similarly their propensity for risk will condition how risk is viewed and undertaken. Therefore understanding each member of the leadership team's propensity for risk would help to better understand their approach to risk both as individuals and then collectively as a team. Additionally we could start to better anticipate where there may be hesitancy or worse still resistance, to change1.
We then spent some time discussing risk; after all there isn’t one universal definition of risk. “What risk type are you?” was a useful series of articles from Changeboard2 as was the tool, The Risk Type Compass®3, which is a personality based assessment tool focusing on differences in the way individuals perceive and handle risk and
The Risk Type Compass® is based on global psychological research and is built around
eight easy to understand Risk Types:
- Spontaneous Uninhibited and excitable
- Intense Highly strung, edgy and self-critical
- Wary Controlling, shrewd and cautious
- Prudent Self-controlled, detailed and systematic
- Deliberate Confident, optimistic, well prepared
- Composed Cool headed, resilient and imperturbable
- Adventurous fearless, up for anything and never discouraged
- Carefree spontaneous and unconventional
Looking beyond the C-suite and leadership to the rest of organization the change curve4 formed a basis for discussing how people could be helped to transition through change more quickly and begin to use initiative (risk taking) to make faster progress.
Psychologists have a term 'confirmation bias', which is where once a belief is established then our tendency is to filter what we see and hear so that our beliefs remain correct. Therefore in this case if the leadership are not seen to be behaving and performing differently then the likelihood is that the opportunity and associated changes to ways of working will not be profoundly believed.
Another factor that can strongly influence the rate of change is 'group polarization', which is people who have shared beliefs will become somewhat tribal in forming a group who fuel their conviction that their beliefs are right and the change is not something they agree with &/or want to do.
Combine confirmation bias, group polarization with a corporate culture that is not lead dynamically, not fuelled by an appealing vision and then prepared for a different way of working organizational change let alone risk taking are unlikely to occur.
The discussion also delved into an evaluation of how the organization is presently operating and the conclusion was decision making was too slow, evidence based management was being used too broadly.
As our conversation was drawing to a close the C-suite executive asked "So, where do I start?"
"Maybe by considering John Adair's 50/50 rule and what is motivating people in your
Clive Steeper is an executive coach, performance consultant and facilitator, working globally with many organizations ranging from international corporations to fast-growth businesses.
Clive has been a business leader for over 25 years. His executive career includes several roles as Managing Director in the UK, USA and Asia. Central to his success has been Clive’s ability to help individuals understand how performance is as much about mindset as it is about activity.
Having excelled in motorsport, as an Engineer and Team Manager, today he enjoys competing in a UK Championship for sports prototypes. Clive is co-author of Motivating People, The Personality Workbook, Cope with Change at Work and a forthcoming title on Risk.
1 Reference to Change - http :/ /www.clivesteeper.com/who-is-responsible-for-helping-you-adapt-to-change /
2 Changeboard–http:/ /www.changeboard.com/content/4155/leadership-and-management/leadership -skills/to-know-your-risk-type-is-to-be-wise/3
3 Psychological Consultancy Ltd.-The Risk Type Compass http://www.psychological-consultancy.com/products/risk-type-compass/
4 Ref. Cope with Change at Work by Sue Stockdale & Clive Steeper