Leaders can be stopped in their tracks when confronted by difficult decisions that have significant repercussions.
- To act or not to act.
- To change course or stay the course.
- To take the risk or not take the risk.
The thinking most often goes something like, “I can play it safe or I can make this move, trusting that it works out as I hope it will.” To stay the course seems safe. To change course feels really risky. After all, you’re comfortable with what is familiar.
There is just one problem with this thinking. It miscalculates risk.
When you stand at the crossroads of a decision, risk resides in both directions. Moving in an unfamiliar direction does not inherently bear greater risk. And staying the course does not inherently bear less risk. In fact, inaction can be the riskiest decision of all.
But many leaders fail to realize this. So they will think they are playing it safe by not choosing to act. Which can be costly.
It was respected statesman, Henry Kissinger, who said back in 1956 that the problem in certain types of leadership is a “quest for minimum risk.” Effective leadership requires the management of risk, not the minimizing of risk.
Over my career I’ve watched as CEOs have cowered at the moment of decision and decided to stay with the familiar, only to have the decision not to act reap an unwelcome consequence.
In one case, I met with a CEO and his head of development and worked through what it might look like to assist their ailing fundraising program. After that meeting I never heard from them again. They stayed with what they were doing… what they thought would be less risky.
Fast-forward three years when a new CEO was appointed to this organization. Within months of his appointment he had reached out to me to seek our help. As we began our work we discovered the former CEO had indeed stayed the course instead of changing. And the results were disastrous.
They had lost more than 50 percent of their donors and annual revenues had dropped 25 percent. Sadly, the organization was being propped up by a handful of major donors and estate gifts.
The tide is now turning, but not without a fairly massive downsizing of the organization. What is grievous is the lost opportunity for impact driven by the significant downturn in revenue. And there is a long road ahead for them as they regain their footing and invest in growing their donor file.
Risk is a reality that every organization faces, whether it is a for-profit business, a nonprofit organization, or a government. And every decision bears a certain amount of risk and a consequence, whether it is the decision to move into unfamiliar territory or to stay the course.
As you face decisions ahead of you, remember that deciding to stay the course and not act may just be the riskiest decision and bear the greatest consequence of all.
By: Rick Dunham