The status quo is a powerful and often unseen force within the daily rhythms of business. It shapes not only the work that gets done on a day-to-day basis but influences the choices leaders make in setting future direction.
During a recent company planning session attended by executives and board members, I watched as the bias to the tried-and-true overwhelmed some truly creative, if somewhat riskier, approaches to longer-term strategic direction. When several board members raised legitimate concerns about ever-expanding but disjointed product portfolio, they were met with stiff resistance from senior leaders on both sides of the table.
Rather than double down on some unique and potentially highly lucrative niche opportunities, the long-term pattern of product development across a broader array of customer segments won the day. On cursory examination, this approach appears to make sense in terms of driving revenues, but it creates a whole array of back-end challenges for this company. These include issues around limited manufacturing and supply chain capacity, brand dilution, customer retention and employee engagement.
Playing it safe and avoiding risk is actually risky business, not to mention a sure-fire way to fall short and underperform when you’re thinking about strategy. Indeed, risk-taking is an essential ingredient to any successful business. Here are five key suggestions to break out of the cycle of risk avoidance and bias towards the status quo.
- Challenge Assumptions
When people advocate for a future trajectory that avoids risks, make sure the assumptions that underpin their convictions are, indeed, relevant and true – both in the short and longer term. So often, the external business and industry context is rapidly changing with implications for any strategy based on a false narrative. Taking additional risk may be the only viable route to successful implementation.
- Address Loss Aversion
Time and again, research and practice shows that people naturally have a stronger emotional response to potential loss than they do to potential gain. Framing new ideas and approaches around what’s to be lost by sticking with the status quo is one way to advance these ideas. Rather than talking initially about the upside or benefits of a new approach, share what’s to be lost if current practice remains in play.
- Focus Your Efforts
To increase your organization’s appetite for risk, avoid proposing an array of new, unique or different strategies. Focus on a select few, potentially high-payoff initiatives and then clearly articulate actions that will help address or mitigate any associated risks.
- Secure Allies
If you’re planning to advance something novel in your strategic direction that entails obvious risk, it really helps to have a diverse set of individuals on your side. And the more risk-averse and ingrained the work culture in which you inhabit, the greater the diversity and wider the set of allies that you may need. Encourage those allies to share the upside of a new or different approach, while acknowledging potential risks. This way, you’ll gather allies who will support you when you face resistance, either explicitly or in more subtle ways.
- Remain Persistent
You may not convince detractors of your new idea or strategy immediately—don’t give up. To overcome resistance and gain momentum, it may take several different attempts, interactions and methods. Hosting one-on-one conversations with key influencers, facilitating small group meetings with those most affected, and crafting succinct outlines that highlight benefits and identify risk mitigation can all help advance your agenda.
As a leader crafting strategy, it’s imperative to incorporate meaningful risks to maintain momentum and ensure success. Increase your company’s risk appetite by challenging existing assumptions, addressing people’s loss aversion, focusing your efforts, securing allies and remaining persistent.