Develop a Tolerance for Risk

When trying to manage change, leaders often make a huge mistake by not telegraphing a tolerance for risk. This article digs into the issue of risk in making changes and suggests an antidote to this common problem.

It is a common statement that the only thing that is constant is change. Perhaps that is an over statement, or you may believe it is literally true. For sure, we are living in times where the level of change is increasing at an exponential pace. The reason for this is that worldwide technology uncovers new ways to do things every minute of every day. If you doubt that, just to try to buy the most advanced cell phone. It is impossible. Before you have swiped your credit card, another model has been introduced somewhere that has more capability than the one you just purchased.

Organizations change in order to keep pace with customer needs and to survive the competitive landscape. The global marketplace has made stability of internal processes impossible. We need to reinvent ourselves just about every day in some ways.

I once heard the great Ken Blanchard describe an instance he had with a Motor Vehicle bureau in California. He had been procrastinating about getting his license renewed due to past memories of standing in long lines only to be told when he got to the teller that he was in the wrong line. We have all experienced this type of bureaucratic bumbling, and no one would blame Ken for not wanting to go.

When he finally could put it off no longer, he scheduled the better part of a day to get his license renewed. He went in and was blown away with the level of service. He was completely done with the transaction (which included a new picture) in 9 minutes. He was so astounded that before leaving he approached the manager to congratulate him and ask how he changed things so drastically. The manager told him it was his job to reorganize the operation on a minute by minute basis to match what the customers needed. With that attitude, the whole focus of the operation became a game of how well employees could serve the public, and productivity skyrocketed.

When managers describe the need for change, they often make a critical error by saying something like this. “We have to go from A to B in less than 3 weeks. This is going to be extremely difficult, but it is critical we not make blunders along the way. Think hard about what you are going to do before doing it. We can get there quickly, but we cannot afford to make mistakes.”

The impact of a speech like that is to paralyze the people who need to be creative in order to actually get from A to B in 3 weeks. They will fail with this strategy.

An alternative way to challenge the group would be for the manager to say, “We need to get from A to B in three weeks. That is a huge task, and it will require us to do some very creative things. I recognize this will mean taking some risk. I want you all to know I will not shoot anyone if something does not work out. We need to break the mold to accomplish our goal. Let’s be sure not to make the same mistakes over and over, but let’s realize there will be some setbacks along the way. My job is to support you in your efforts to achieve the goal.”

With a speech like that, people will be more empowered to use their brains and figure out the pathway to success. In the first case, the manager petrified the workers, in the second case the manager turned them loose to solve their challenge.

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