Most of us know that Babe Ruth is famous for his home run record, but for decades he was more than “The Home Run King.” He was also “The Strike-Out King.” Although he hit 714 home runs, he also struck out 1,330 times in his career. He explained this by saying that “Every strike brings me closer to the next home run.” Obviously, the Babe knew that if you don’t swing at the ball, you can’t hit a home run. When I was a young boy in little league, we had a kid on the team who never swung at a pitch. He just stood there like a statue. He confided in me that he was afraid to swing because he might miss the ball and embarrass himself in front of the other kids. He ended up being our worst player, and everyone made fun of him anyway.
So how many times have you failed to take a risk or pursue an opportunity for fear of striking out?
Entrepreneurs are those that are willing to take risk in the face of uncertainty in order to achieve profit and growth. They pursue opportunities, make investments in their companies, and capitalize on resources. Lifestyle CEOs have a good thing going, and they don’t want to screw it up. They make a nice income, conserve capital, and are averse to pursuing new ventures as they attempt to keep everything safe and secure. They don’t want to risk losing what they already have.
There is no right or wrong here
You can be either of these types of CEO, as long as it meets your needs and the needs of your stakeholders. However, if you are one of those CEOs that has a vision to grow your company, then adopting a lifestyle approach is not going to get you there. You will have to step up from time to time and take a risk, sometimes betting everything on a new idea, a new product, a new market, or even a new employee. If you are afraid of failure or losing what you have, then you might want to pursue a different line of work. John Wooden, perhaps the greatest college basketball coach of all time, once explained that winners make the most errors.
Some of the CEOs I coach are apprehensive about spending money on things like a new marketing campaign, or hiring more staff to facilitate growth. I usually explain that it’s like riding a wave. You can either be ahead of the wave, or be behind it. You can either take some risk and make investments that will pay off later (or perhaps not), or play it safe and wait until an opportunity has passed you by, and then play catch-up, hoping to achieve something without taking any risk. The former is more likely to reward you than the latter.
The bottom line is that nothing worthwhile comes easily
Taking risk is a part of your job description. Embrace it, and do it as any prudent business manager would. Examine the risk and rewards, make an informed decision, and put aside your fear of failure. Take a swing at a ball that looks good to you. You can’t knock it out of the park if you never swing at it.
Look at Lincoln
If you still have any doubts, let me give you an example of someone who was an abject failure, striking out time after time, until he finally hit a home run: As a young man, Abraham Lincoln left to go to war as a captain, but returned as a private. He then became a failure as a businessman. As a lawyer in Springfield, he failed again with an unsuccessful practice. Then he turned to politics and continued to fail. He was defeated in his first try for the legislature. He was defeated again in his first attempt to be nominated for congress. Then he was defeated in his application to be commissioner of the General Land Office. Continuing his long streak of failures, he was defeated in the senatorial election of 1854, defeated in his try for the vice-presidency in 1856, and defeated in the senatorial election of 1858. He was feeling like such a failure at this point, that he wrote in a letter to a friend, “I am now the most miserable man living. If what I feel were equally distributed to the whole human family, there would not be one cheerful face on the earth.” Two years later, in his next try at something, he ran for President, which, as we all know, he won… He was a wartime President who saved our nation, and has gone down in history as one of our greatest Presidents. What if he had given up taking risks back when everything was not going well for him? Would we have ever heard of him? Would our country be the great nation that it is today?
Think of all the truly great CEOs that are out there running great companies.
They all took risks, and sometimes they failed. But they didn’t use failure as an excuse to stop taking new risks…that’s why winners make the most errors. If you want to be a great CEO, know your opportunities, evaluate your risks, make prudent business decisions based on the returns that those opportunities could deliver, and execute a well thought-out plan. If it doesn’t turn out as well as expected, try again. You can’t grow a company by playing it safe. Don’t be afraid to swing at the ball!