Part 5 of Greenacre’s series on Retaining Top Performers focuses on Risk Taking, and the impact and delicate balance of allowing our future leaders to take calculated or measured risks, versus minimisation of negative impact on the organisation as a whole.
There is nothing new about risk taking and risk management, however the landscape on which they now sit has become decidedly different over the last decade. Not so long ago, risk avoidance was the main focus, due, in part, to the drive in regulatory compliance, and the lack of technology that we now have in the current digital age with which to measure impact and projected outcomes (Deloitte, Risk Becomes A Performance Enabler). Because of the latter, a distinct shift is now playing out, which is pushing risk taking not only in a different direction, but to a whole new level. By allowing those within the workforce who wish to do so the freedom to innovate and experiment, using technology such as analytical tools, state of the art communication and recognition processes, as well as time saving systems, energy can be channelled in much more productive and creative ways.
As well as encouraging employees to use these advances in technology to take their own calculated risks, the same technology can also be used by organisational heads to examine behaviour, and get a bird’s eye view of overall performance, making employees who are willing to seize upon appropriate opportunities easier to pick out, whilst the impact of their decisions can be measured in real time. A more evolved and modern approach to leadership, which we touched upon back in part two of the series, Embracing New Ideas, can further allow individual negative impact to be substantially minimised. Employing a management style that seismically differs from the older hierarchical models, and changing to a far more diverse, lateral and decentralised approach, allows employees to be directly responsible for, and reactive to, their own decisions and actions.
In the last article, Praise, we discussed how a positive language culture, and a dialect of recognition and appreciation significantly reduces the risk of high performers leaving their current organisations. Beyond this, praising risk takers when their decisions have paid off or had a positive impact on their team can often reinforce the individual’s confidence levels, which in turn can encourage them to take more responsibility, and thus make bigger, higher risk decisions in future scenarios. According to Deloitte, however, this can also risk the possibility of exposing employees to a higher perceived danger level than is desirable, or even potential damaging a reputation, if management has not properly utilised available technology themselves to appropriately engage with individuals within the group.
As organisational culture is changing and diversifying at such a rate, it is important for this to filter through to the younger, future generation of leaders as they grow and develop their skills and experiences as they enter the workplace. One such example of combining risk, innovation, technology, creativity and praise in a collective embrace for younger future leaders can be seen at The Global Student: Building Bridges over Growing Barriers Conference in Lisbon recently. German students Staytoo Kaiserslautern won an award for their commitment to working in partnership with public sector organisations when developing accommodation projects. The project featured office space for start-up businesses in conjunction with living space for students and researchers at the University of Kaiserslautern.
As well as creating the right culture and practices at the beginning of an employees’ career within the organisation, there should be a constant pathway to progression to maintain and develop individual potential. Effective Succession Planning can forge such a pathway when implemented in the right way. Melendy (5 Metrics For Effective Succession Planning) believes “Every employee you hire should exhibit potential to grow beyond his or her entry-level position, but it’s important to keep track of this potential to inform the employee’s future career path. Managers should ask themselves, “Does this employee demonstrate the ability and qualities to take on additional responsibilities and roles?”. We could add to this “Does this employee demonstrate the abilities and qualities to take considered risks and manage outcomes?”
According to Defibo (Fortune.com) there are three ways to encourage risk taking: Explore uncharted territory (such as encouraging and rewarding new ideas), Supporting the ideas (financially and practically) and ‘being passionate’ (encouraging individual interests to bring fresh ideas to the table). By enabling great ideas to take flight, equipping risk takers with the means to implement them, and supporting the journey using advanced technology control mechanisms, there should be ample room for a risk taking environment to grow and flourish, and with these concepts in mind, we can also encourage the young entrepreneurs, the very top performers, and our future leaders to do the same.