1. Is it necessary?
2. Am I willing to take that risk?
The next time you have a “GREAT IDEA THAT WILL CHANGE YOUR INDUSTRY”, ask those two questions.
They will save you innumerable hours.
Let’s digest them in a little more depth:
Question #1 Is it Necessary?
Sometimes it’s hard to let your brilliance face the reality of other people’s opinions.
But that is the only way to have an honest look at this question.
I’ll be the first to admit, I hate having an idea ripped apart (kindly?) by friends and colleagues. But honest connections to people that will tell you the bold-faced truth can guide you in the best direction.
Now if you asked Walt Disney if a full-length animated movie was necessary. He would have said ‘Absolutely’. And those closest to him were either rolling their eyes or jumping with excitement at the prospect.
A TRULY GREAT idea, is typically polarizing.
Because if it is reasonable, no one questions it. (Should I drink water? Should I start looking after my health? Should I sleep more than 2 hours a night?)
If it’s lousy, everyone will tell you so. (Should I skip meals all week? Should I stop brushing my teeth? Should I look directly at the sun?)
But if it’s brilliant! (Edison and Gravity, Walt and Disneyland, Steve Jobs and the iPhone) some people will think you’re nuts, and others will say you are a genius.
The same goes for ultimately what we have deemed ‘stupid ideas’ too. They look good at first, or even promising if you have the capital to invest. But what happens when everything goes wrong? Much less even just a few things actually going right.
Here is an overview of various ‘Flops’ of industry giants, including Apple, Sony, Coke, McDonald’s, and more.
Question #2 Am I ready to take that risk?
Here’s the hardest part about an idea. They are worth about a dime a dozen, but the right one, at the right time, could be worth BILLIONS. (Microsoft Software? Amazon Next Day Shipping? Walmart Everyday low prices?)
And just like the flops I linked to above, they could cost a fortune of your profits and reputation as well.
So the most important thing to consider is this question to yourself: If I take this risk, am I prepared for the consequences good or bad?
“Let me assure you, I can guarantee you that none of these ideas are guaranteed to work,” Bezos said. “All of them are gigantic investments and they’re all risks … The only way to get above-average returns is to take risks and many won’t pay off. Our whole history as a company is about taking risks; many of which have failed and many of which will fail, but we’ll continue to take big risks.” Jeff Bezos
Clearly, Jeff is comfortable with HUGE risks. My question for you… Do you want to be the next Jeff Bezos?
Again, consult with your peers to gain insight, poke holes in your plan and idea. A perfect plan doesn’t just happen, nor is PERFECT even the goal. It requires a variety of insights to pick apart every aspect so you turn out the best result.
A Quarterback has a coaching staff dedicated to tweaking and adjusting their offensive strategy. But in real-time, they can fail massively and then make a 180 to change the next play.
What’s the lesson in that?
Don’t take a risk you can’t recover from.
If you have $X00,000 top-line revenue. Don’t gamble 50% on a ‘whim’. Strategically invest small, micro dollars until you have something that stands the test of time.
Jim Collins talks about ‘calibrate your strategy with bullets, and then load the cannon’. Essentially, spend small until you know you have something that could actually have a successful path.
(check out our other blog with more great ideas from Jim Collins)
Sure a single prototype costs $5000 when you could produce 10,000 units for $25,000. But what’s the risk? And can you completely lose that and still recover the next day?
The realism in this phrase is so true “When starting in business: It will take twice as long, cost twice as much, AND YOU are NOT the exception” (I credit Dave Ramsey with this phrase)
Recap of our 2 Simple questions
Is it necessary?
Am I willing to take that risk?
Ask them about the idea that you’ve been thinking about pursuing.
Get the feedback, and then take action.
If the action is: STOP. You will be able to pool those resources into a better, less risky idea.
Unless you want to bet the farm?
That’s the only question that would make these two irrelevant.
Happy dreaming!
