In any business planning, we should take all the necessary risks to achieve the highest possible returns, but if the risks are not calculated, it becomes a recipe for failure. – Mr Inderjit Singh, The Art and Science of Entrepreneurship.
It is usual for a layman to relate the term ‘entrepreneurship’ to risks. However, it is an old perception with several negative connotations attached to it. While one may conjure up the image of an individual scrounging around for cash for a business that does not have much to come out of it, the reality is entrepreneurship is a concept taking the world by storm.
For any start-up business, spelling success often turns out to be a seemingly impossible feat to accomplish. Every business involves risk, as it is a notion related to achieving the returns you have anticipated. This is where calculated risk-taking comes into the picture as it is the magical ingredient to concoct the perfect recipe of entrepreneurial success.
Risk-taking is inevitable, especially in the context of entrepreneurship. Therefore, it is essential to specify that calculated risk-taking is the key that will ultimately bring about the accomplishment of goals.
The question is what actually does calculated risk-taking imply? To be precise, it annotates a state of being well prepared in case of failure. A fool-proof plan, no matter how promising it may seem, does not exist. It is for such trying situations that it is imperative to have backup plans that significantly remedy the pain or setbacks that will be incurred as a result of the failure.
Being in a state of preparation helps an entrepreneur get better grip of the situation encouraging him to handle it effortlessly. Business planning does not mean having a plan that you are hoping will work. It is about preparing, taking and expecting the business to face any challenges that may come about.
As they say ‘expect the unexpected’. A well-thought out plan is one where you not only keep an eye on the gains but are also aware of the chances of failure eclipsed by the promising nature of prospects. This way failure does not catch the entrepreneur completely off-guard who is still in the process of gaining his footing. This allows an individual to realize his true potential, not letting him succumb to the effects of the catastrophe.
The point that needs to be established here is that the chances of failure for any start-up business are considerably higher as compared to that of its success. Embracing the mantra can help an entrepreneur stay aloof of the stress when the outcomes are other than those expected.
Calculated risk-taking does not mean that you plan to fail. Instead one should be able to bear the brunt in the event of failure. With a contingency plan up one’s sleeve, an entrepreneur will not be overwhelmed since he has already determined what needs to be done in case of crisis.
Calculated risk-taking can also be termed fairly as the sorcerer’s stone for entrepreneurial success. The entrepreneur will be able to keep his focus on the appropriate execution of the business plan as opposed to always having to look behind his back for the fear of failure stabbing him.
Taking risks that are calculated can serve as a life-saving drug for any business. Not only do they prevent an entrepreneur from slowing down, with the assurance that there are survival plans already in place, an entrepreneur can bring out the best in him. This increases one’s chances of success.
On a final note, calculated risk-taking revolves around the idea that one should hope for the best but prepare for the worst. Entrepreneurship is the art of organizing resources in the best possible manner and by taking calculated risks, helping entrepreneurs explore new realms of business that leads him to all the success desired.