In a list of 10 Rules for Leaders Navigating Opportunity and Risk – it feels to me, that at least one of those rules ought to focus on the navigation itself. Otherwise, it’d be like equipping you with a ship, anchor, and sails, and forgetting to supply the compass. And since there is no time like the present, it’s that analogy which serves as a prelude to Rule 3: Reason with Risk.
In my decade-long tenure as CEO of Spirant Group, I have had to assume the role of chief navigator through many uncertain seas. Ultimately my sense of direction has led my organization to where it is now, a global group comprising several successful businesses. That success of course can be attributed to a sequence of moves and actions that drove growth and progress, but my achievements are also a result of the plans that failed. The occasions where my leadership compass did not lead to the intended outcome have also shaped my journey towards becoming a successful CEO – and failing to mention those would be doing a disservice to my lessons in leadership series.
One such example relates to my Group seeking to enter the USA market in 2021. We had scoped the opportunity for legal tech and outsourcing, in which our Group specialises. In addition, we had carefully assessed the risk that the ongoing Covid pandemic presented not least ongoing international travel restrictions. To meet this challenge, we had in position a number of Spirant Group team members with boots on the ground in New York and California respectively.
We were ready to go and launched our marketing campaigns in spring 2021.
What I had failed to identify was the level of the competition in the USA, particularly the larger markets. Whilst a faithful replication of our UK strategy for digital marketing and social media in Australia had allowed us to make a seamless market entry in 2017, the strategy stalled in the US. The level of competition on and offline meant that – whilst our services undoubtedly had a market – gaining traction with our target audience was much more difficult than we anticipated. After persisting for 3 months, we parked the campaigns, drew back on investment and reprioritised our entry to the US market, which we now have in line for later in 2023.
This failure was a terrific learning experience. Not only did we gather market knowledge which will help our future plan, we identified a flaw in our strategic planning and filled that immediately.
Above all we observed the important principal that if you’re going to fail, fail fast and get out. Persisting to spend when you’ve got it wrong is not at all clever.
However, despite that particular scenario and those like it, I can say with overwhelming certainty that I don’t regret my move. Because failing to take a risk would have been a hundred times more detrimental to my position as a leader. That’s because, in times of uncertainty and challenge, a leader must make a decision with conviction. Put under pressure a successful leader will make a measured decision that considers the consequences – both negative and positive just as I did – and steams ahead, galvanising a team toward the same direction.
The antithesis then of this advisable leadership style would be indecision. A business strategy needs steering in one direction or another. Trying to lead a business in a way that seeks to avoid risk or mitigate challenges completely, is a kind of leadership paralysis. Pouring over the endless possible outcomes creates stasis, and the inability to move forward, grow and progress. Three fundamental characteristics that are surely intrinsically linked to what makes a successful senior leader.
The maze is full of tests, but it’s a place of opportunity too. I have often found myself spearheading a strategy in one direction, only for that direction to reveal an opportunity to pivot in pursuit of another. Therefore, what leaders need to know most when tasked with guiding their organisation through the ever-changing business landscape is:
To equip you with the skills and thinking needed to achieve those four fundamentals, I’ve revisited what I know about navigating the ever-changing climate of business. It’s uncertain yes, but with these top tips, you’ll be ready to sail through risk and opportunity and guide a business to its potential.
One of my top tips for successful leadership is to have the ability to foresee potential opportunities that could arise as a result of your intended strategic direction. By being able to anticipate possible opportunities, you’ll be able to create a plan for how you will take advantage of them if and when they arise.
My first point on opportunities is not to say that I’m in favour of ignoring risks. In fact, being mindful of risk is a key skill for successful leadership. It includes assessing the impact that an opportunity or a risk could have on the organization and its stakeholders.
One of my most crucial tips for successful leadership is not letting a risk perturb you from the opportunity. As a leader, you must understand the risk and view it as an important balance to rampant unchecked ambition. Identifying a risk shows that your thinking is straight but should not lead to a dead end for the opportunity.
Once risks have been identified, leaders must then develop strategies to mitigate them. This could involve developing contingency plans or implementing new processes or technologies to reduce undesirable consequences.
However, for all that planning – there will inevitably come a point in a ‘risk chain’ when further contingencies and mitigations become impossible. This is the point where the leader must decide whether the occurrence of the risk is likely and, if so, how likely. There is no hard and fast rule here. In the end, leadership instinct and experience will dictate the decision.
Leaders must facilitate collaboration between all stakeholders to address any risks or opportunities. This could involve bringing together individuals from different departments or backgrounds to work together to identify and address any potential risks or opportunities that could result as a consequence of your growth strategy.
What is crucial is that the leader communicates their direction with clarity, conviction and with structure. Every stakeholder must be clear on the journey ahead, what this kind of navigation is seeking to achieve and be able to balance risk and reward throughout the process.
Finally, leaders must lead by example to show that they are taking the risks and opportunities seriously. This could involve setting clear expectations and standards, providing feedback and guidance, and demonstrating a commitment to achieving the organization’s success via the intended strategic direction.
By taking the lead in navigating a business through risk and towards opportunity, leaders can ensure that their organization seeks out opportunity whilst not being complacent about risk.
I hope that armed with these top tips for effective leadership you’ll be equipped to navigate the complex and fluctuating landscape of business with conviction and clarity even in times of challenge. And as I’ve often found, in the same way a sense of direction is built from familiarity – a leadership compass is fine tuned from repeated entry into the maze of risk and opportunity.