Uncertainties & Risks

F-Heisenberg_uncertainty_principle

By Okello Okello

Often times people talk of risks as the only fear to getting to entrepreneurship but do they really mean risks? What are risks? Is there anything else other than risks that can raise an entrepreneurs adrenaline. As an entrepreneur, if an action does not cause you to take a deep breath before you do it then it might not be risky enough and that means that it is not as important.

It is also good to understand that there is no perfect risk out there. There is a lot of uncertainty with decisions we make since we mortals can only operate in a linear time scale unless we are supreme beings. Therefore, people are always not scared of risks but the uncertainties that come with entrepreneurial decisions you make. What are uncertainties?

Uncertainty refers to outcomes not contemplated during the decision-making process while on the other hand risks refers to outcomes that have been contemplated, and are quantified as probabilities. The fact that risks are premeditated makes them expected in a way but uncertainties are those happenings that are not thought of and those are the most dangerous ones.

Duo-contemplation is about how to react in such occurrences of uncertainties. An entrepreneur needs to have clear thoughts when things do not go as planned. It can be drenching to operate in such a situation. Uncertainties can also include unexpected positive results or unexpected successes.

Uncertainties can be as a result of , Workers skills not matching the required standards of performance, low productivity due to low employee moral,  or the general mishaps in assumptions in the forecast sessions. Entrepreneurs should then give more weight to non-financial and qualitative factors than financial data. This is not to say that financial data are less important, but seeing past financial data can help give a second come back after uncertain occurrences.

Duo-contemplation matrix covers recovery from both risks and uncertainties and it heavily relies on the leaders ability to absorb market shocks and make wise decisions after a fall. For duo-contemplation to happen successfully, a leader should be ready for drastic changes. Employees should also be in a position to take the change with minimal and if possible no resistance however before these changes happen, an entrepreneur or a leader should consider;

Emotional Effects

How are the changes going to affect the entire team that an entrepreneur is working with? Are they comfortable trying new things? If they are not, how can we transform their fears into a cash flow generating ideas. That is the reason why business gurus do well. Dismantling failure, uncertainties and fears that come with it forms a strong base of success. As an entrepreneur, you do not want to be at the mercies of your emotions. Use your emotion to defeat itself. Change your emotions into happiness and enjoy the outcome no matter what it is. Sharing this attitude with your employees build confidence and a strong belief in the organization after drastic changes have happened. It is also important to know that when making changes, they should not be hard to adopt.

Psychological Effects

Let us take mind as the function of feeling, awareness and motivation. Anything that interferes with your state of mind negatively is what you do not want as entrepreneur. This is not easy as it may sound especially after a failure. The idea of duo-contemplation is to have a strong and stable state of mind to help you fight all the emotional effects that might come with a failure. Human mind is the most versatile organ in a body and can be trained to respond positively to any action.

As devastating a failure can be, human mind never run out of tentative solutions to the main problems in other words, there is no big challenge that human mind cannot handle. “No temptation has overtaken you that is not common to man. God is faithful, and he will not let you be tempted beyond your ability, but with the temptation he will also provide the way of escape, that you may be able to endure it.” (1 Corinthians 10:13). I wish every entrepreneur would read a bible as it boosts one’s faith when it comes to trying risky things. Based on this bible verse, you can meet challenges of different kinds but God has promised that you will not be over come by temptations, therefore do not let your challenges affect your state of mind.

Why the Change

Entrepreneurs should not just propose a change because they feel like it is good to implement one. When going for a change, plan and always remember to maintain your core values intact. Always have a positive and a better reason than before of why you think a change is important. A change can be too big that it becomes insignificant. That is when a change is leading to a permanent failure. Based on keen observation of British Motor Works (BMW) X series, Starting from X3 to X6 there has been very slight changes on every stage, either on chassis shape, gearbox setting, interior space, engine size etc. The changes are always minimal, direct and less complex. They are identifiable changes that does not need extra work to learn or adopt especially on a consumers perspective. The fact that you can also order a custom design BMW makes it even better so the changes suit your preference. The point, always have a reason why you are introducing a change and let it be easy to adopt.

How “The Art of Execution”

Doing the same thing all the time, tremendous repeat or repeated abuse as one of my friends describes it is unhealthy. It is said that change is as good as a rest therefore change should be constant and always in motion. That is when you change the change. So how should people execute the art of change? Implementing the art of change can be hectic yet it can also be simplified through these key points.

  •  The vision: It is important to lay out the vision, what exactly is changing and how is it going to change. The vision gives a broader picture of what the team will work towards. This vision should be clear, short and precise. By making the change vision clear, short and precise, you are simplifying it for your team to easy adopt it therefore there is a higher chances that they will buy into it.
  • Specialization: You want to match the tasks with skills required to accomplish them. Through specialization and division of labour, you are already simplifying the change making it easy to adopt. Clarity with each individual on how important their tasks and roles are to the vision of change helps develop a team synergy. Duo-contemplation work best if you match your team with what they can do best. It is all about maximizing the output from your team.
  • Follow-up: Great leaders go to their employees to inquire if they are meeting any challenges. Try it, it works. You do not have to implement a change to do this. Just ask how you can help them meet their goals, make fun and create a lively work environment. How many entrepreneurs like to crack jokes with their juniors? You want to create an environment where your team enjoys your presence and the work they do. It is also important that you make them know that you are in control, a manager, a director, and the boss if you like calling your self that.

Span it Takes to Change

How drastic are your changes? Are they changes that need 10 years to adopt? Since you are working with start-ups and growing businesses, a change should not take your team more than three months to adopt. It should be that simple. Design a change that impress, a change that every body wants to flock to. If you find it difficult to come up with one especially after failure then look at the reason why you failed or what you want to improve on and just tweak it a little bit.

Let us look at this example, you are a fruit vendor who sells a lot of bananas every week. In one week due to bad weather your sales went down and you are left with a lot of inventories that are perishable. Since You want to maximize your cash flows and revenues, you can decide to have a banana cup cake business along side your grocery to take care of the left over fruits. This is an example of a change that does not require a long span of time to adopt. It is easy, almost obvious and can still generate some income to support the business.

Realistic Goals

If you are a start up, you do not want to tell your employees or yourself that you are going to generate 1 billion in the first week of your business launch. Not that it is impossible, but setting realistic goals is always good. Start small then grow big. You do not want to risk a lot of your resources in a start up therefore losing it all is not good. Be economical, take it one step at a time and sent achievable goals with a reasonable time limit. Most entrepreneurs are big dreamers, I am saying this out of experience. This can make it extremely difficult for your employees to match your expectations because you always want your books to read 100 million revenue in your first year. Give your employees enough time and realistic goals that they can attain. It is better you give them short term and easy to achieve goals that will grow your business than giving them big, dreams that they cannot achieve making you close your business in the first few weeks it starts.

Planed Plans

When a King wants to concur another kingdom, he meets with his military heads to plan and strategist the attack patterns. This is something that has existed through the ages. Planning. You do not want to attack a giant with bear hands. Think of a story in the bible; Joshua 18. Joshua is sending out three representative to go and survey they land, they were to write  a detailed plan on what they saw, and how to get in the land they were promised. He is also laying strategy on how to divide the land, who settles on the south, who goes to the North and who remains in the East.

Key lesson is, plan your movement. Plan your action. plan and again plan the plan. It is really hard to win without a plan. That is why most politicians work with a campaign team. These are people who meet everyday to lay strategies depending on the location of campaign. Having been in African Politics as a strategist to a member of parliament, I can say that strategists do more than what you see politicians say on screens or on a political rally.

After the speech, then we analyze the clips word by word, gesture by gesture, information by information then we do a quick meeting every day to update the potential candidate on what he did well in and what he missed. We also monitor his dressing cord and match it with the tribe or a particular group of people he is going to address. All these are planning and if well executed, they can result into a big success.

Uncertainty, Risks and Fear works like three horns of a triangle. Once you dismantle one side the whole structure collapses.

2 thoughts on “Uncertainties & Risks

  1. Nice article! Realistic goals, planned plans and foreseeing potential risks should be listed as priorities for those aspiring to be a startup business. In Mapline, we help startups to create business plans with calculated risks. When they plot factors on a map, they can identify risks thereby allowing them to create many different options to manage risks.

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