Risk is a tricky concept. Business typically wants to limit, manage, or mitigate it. Eliminating risk altogether probably would be seen as the ultimate success (thank you, Six Sigma). But in life, most great things don’t come without some level of risk.
Getting married, having kids, quitting a job, taking a new one. Think of any of the biggest developments in your life or the broader world around you and I’d bet none of those happen without a fair amount of risk.
However, from an early age we are taught to avoid risk. We understand that with risk comes mistakes. And mistakes can be painful. But making mistakes is also how we learn.
We aren’t born knowing that the square peg doesn’t fit into the round hole. We need to try it for ourselves. We experiment. We learn not only what doesn’t fit, we also learn what does. And in that process of learning we begin to see relationships—those between shapes and spaces, challenges and solutions, effort and satisfaction. More is learned from the time spent trying than if we got it all right on the first attempt.
But in business, mistakes mean more cost, more time, and lost opportunities. With the drive towards higher levels of productivity, higher margins, and more efficiency we don’t have room for mistakes.
Without that room, the ability of business to learn and grow is limited. Sure, companies can capitalize on incremental opportunities but they will miss the bigger breakthroughs because they didn’t see as many relationships, have as many experiences, or try as hard. They won’t learn as much from their mistakes, because they won’t make as many of them.
Companies need to create room for mistakes. To explore and try out stuff with their customers. To learn. And to do so faster, to get to the right solution sooner. When companies can make mistakes (ideally outside of the public eye) they can learn invaluable lessons from doing so and bring their customers better solutions because of it.
Risk isn’t that tricky of a concept if you think about it differently—not as the negative value of an event, but as a process capable of yielding positive, even breakthrough results. Make a practice of making mistakes. Create a private space in which to do so. Build a “learning agenda” for your company. And embrace risk. Because what’s true in life is true in business—most great things don’t happen without a fair amount of risk.