Risk Taking
February 14, 2012
The June 22, 2009 cover story of Business Week which I just reread was titled “The Risk Takers.” It featured businesses which during difficult times, instead of playing it safe, placed bets on some gutsy new strategies.
To make a point, the author used an illustration that we can relate to here in Michigan. I paraphrase:
Imagine a driver on a snowy night. If the car starts to slip, the driver’s natural instinct is to slam on the brakes and jerk the steering wheel in the opposite direction. But the laws of physics advise the opposite: laying off the brakes and steering into the turn.
The author reports that from 1985 to 2000, the average merger in an economic downturn created an 8.5 percent rise in shareholder value after two years; while the average deal in good times resulted in a 6.2 percent drop in the buyer’s share value. In other words, mergers – one of the biggest, boldest moves in business – do better in bad times than good. Much better, in fact.
It wasn’t recklessness this article was celebrating; it was risk taking – daring to be aggressive, rather than just defensive, amid a weak economy. Steering into the turn, so to speak.
Just like the winter driving analogy in the article, we who are involved in school sports in Michigan can relate to the big idea of the article because we too made some of our biggest moves at our bleakest times. The MHSAA retrenched in some ways, but the greater theme as we climbed out of our bad times of 2008 was that we made unprecedented investments in new technology.
Today MHSAA.com is the website of highest traffic and MHSAA.tv is the website with the most productions of any comparable organization in the U.S. And all of these investments in technology during those bad times have allowed us to undertake the ArbiterGame project now that will provide all member high schools the electronic tools necessary to make their tough tasks of school administration more streamlined than ever before.
Leadership Road
May 22, 2015
Earlier this month, the small portion of Michigan voters who bothered to vote at all resoundingly rejected the so-called road fix – Proposal One. It was no surprise, and provides at least these two leadership lessons.
First, people expect their designated leaders to lead. From everything I’ve read, heard and felt personally, voters were upset that their elected officials could not or would not fix our state’s crumbling roads and bridges. They punted; and the voters punted the ball right back to the people they expect to have the wisdom and will to craft and compromise their way to workable solutions to tough problems.
The second lesson is that people expect straightforward solutions. Again, there is every indication that Proposal One was too complicated and a far more comprehensive package than people could comprehend. By trying to do more than fix roads and bridges, the proposal wasn’t able to get the support needed to do anything at all.
The creativity and courage to prepare and promote the most direct remedy for road repair is a top issue for the State of Michigan. Taxpayers of the state want their elected officials to run an offense to move the ball across the goal line, with little razzle-dazzle and no punts.
That’s the preferred and probably necessary approach for addressing the major problems of any enterprise, including ours.