Women in Business Growing By Taking More Risks

By Jill Sommers, Business Entrepreneur and Business Writer 

One the the things that has interested me in the 'women in business' category, is that we women tend NOT to be risk-takers--naturally.

Maybe it is the human female desire to 'build a nest' as some psychologists have put it, rather than to build an empire. I don't know. But I do know that women in business have built some VERY substantial enterprises--certainly not on par with men--but still substantial.

Now running a business, I feel, is an entirely different subject. That is not what I'm talking about here. We women can be found at the helm of some very healthy Fortune 500 firms, but running a business is not the same as building it from the first-customer up--the proverbial square one.

Why?

Because it seems that with all the statistics in front of us today, that women are the best at following a design, a plan if you will. Better than men--in general. Now don't get me cast in a category that ONLY a woman can do this or that in business. I've known women MBAs to use their MBA emphasis to run companies, run large non-profits, develop organizations and so on.

But this is something that is already started. Something that has been operating a few years. Something with a history to look at and make decisions from--not start it from scratch.

At the Quad State Business Journal, we've often discussed that women are better at following a business model rather than creating one. Steve Lanning mentioned that he feels that is why some of the most successful women in business have been women in the real estate industry.

In real estate, as in other industries, there is a pre-determined model of how prospects are acquired, nurtured and sold. Steve reported that his daughter, in banking in the Quad State, has reported depositing some nice seven-figure checks into the account of women in real estate.

So Why Should A Women In Business Take Risks?

The short answer is that they need to in order to grow. Some of the most hesitant, risk-avoidance activities have been responsible for women not advancing in their business--especially those just starting out--but it cuts across the board for any woman-owned business.

Here are some current stats from the Small Business Administration...

1. The number of FULLY women-owned firms accounts for 30% of all enterprises.
2. Women-owned firms employ only about 6% of the country’s workforce. That number seems to square with those owners in the Quad State. 
3. Women-owned firms contribute just 4% of business revenues – roughly the same share they contributed in 1997. We feel that risk-avoidance is a reason along with the fact that women can achieve success in non- business areas such as being an executive in business or in government rather than running their own business--opportunities are plentiful here. 
4. Only 1.8 % of women-owned business hit the $1 million dollar mark compared to the national average of 5.3%. Roughly 88% of all businesses--across the board in the USA--are businesses with less than $500,000 in sales.

In studying the stats between 1997 and 2013,  while the number of women-owned firms grew at 1.5 times the national average, look at the number of women who make it to the million dollar mark and the fact that women-owned businesses still only contribute 4% of business revenues to the economy.

This is the same amount they contributed in 1997!

We Are Talking About 'Calculated' Risks of Course

There must be family considerations, too, in that calculus. A friend of ours had a car wash in Berkeley County and owned land in Franklin County along a very well-traveled Route 30 location in Chambersburg.

Yet when a family crisis came up, they had to sell the location. But the types of  calculated business risks I am talking about include:

1. Hiring more employees (most women-owned firms are owner-operated)
2. Taking out business loans (most women-owned firms finance on credit cards debt)
3. Embracing change and responding to challenges in the marketplace
4. Knowing when to get in and when to exit! (With a tip of the hat to the Kenny Rogers song, 'Know When to Fold 'Em" --Ha!)

Practical Insight about Risk for Women in Business

1. Don’t be afraid to fail, if you don’t fail sometimes, you are playing it too safe. Most of the Quad State women-owned start-up business we've found have owners that are scared to death to fail. A little of that attitude running through your mental approach is a good thing. But it is when that attitude consumes your every decision is when potential progress is halted.
2. Follow your intuition, for many times your gut reaction is correct. This is akin to follow your dream but also follow your gut in day-to-day decisions as well.
3. Understand that everything won’t be comfortable all the time – you will need to have uncomfortable conversations with your employees and colleagues. Zig Ziglar sometime in the 1980s promoted a song called, "Get Out of Your Comfort Zone.' Catchy tune and even as adults today they refer to it.
4. Realize that doing the same thing over and over will only result in the same outcome – and will eventually lead to diminishing returns and potential failure. Everyone, no matter what anyone tells you, at some time in their business lives, does the same thing over and over and expects different results. We call that insanity, but even business organizations get into the rut at times--sometimes for years. 

Develop a Low-Risk Plan to Get In the Habit of Taking Risks

1. Start by taking small and less significant risks that have fewer long-term consequences.The term 'baby steps' is operative here. Small risks, well-calculated, will lead eventually to taking larger steps in business. 
2. Begin with the end in mind. Develop a specific plan for what business success looks like and work toward that. Having a plan to follow decreases your level of uncertainty about the future and thus decreases risk. A good business coach can be worth their weight in platinum here.
3. Ascertain an outside level of the amount of risk you can endure and work to this level (i.e. taking out loans up to a certain level, hiring a certain number of employees). This is akin to the biblical admonition in Proverbs of 'knowing well the condition of your flocks.' When you know your 'flocks' (eg your inventory, employees, your market, your margins on products) risk can be tolerated so much better. Not saying it get easier, but it does get better. 
4. Ask, ask, ask! If you don’t ask you will never be in the game. Remember your training if you've taken a good sales training course. Always be asking for the order. Or use the old ABC method of Always Be Closing--that is ASKING customers to become happily involved in your products and services. 

Risk-Taking Also Has to Do With Your Personal Confidence

If you sell services, how good do you see yourself in relation to other competitors? How good do you see that you are helping your customers? Better than 90% of your competitors? 100%? Are you proud of your products sold in how they improve your customers' lives? Here are some ideas that may help?

1. Lean toward your risks. Don't think of them as risks per se, but push yourself in expanding yourself in various learning situations. 
2. Become an expert in your field and in the future trends in your business sector. Knowledge is power and if you have a good sense of future trends, you will be more secure taking risks. Become a student of trends in your industry. If your market concerns the county you live in, see what the trends could be in the Quad State region. If your market is the Quad State region, learn about the national and international trending.
3. Find a mentor who you can work with to help you overcome fears and evaluate opportunities. We are very pro business coach in all of our affairs. However, many of our business leaders still conflate the interventions and outcomes of business coaching with consulting in many instances.  They are not the same. As a business owner, confusing the two outcomes can cost you money. Learning and focusing on the differences of consulting and business coaching can be extremely profitable when you correctly learn to use the two interventions.

There is much left that women in business can accomplish. It is my personal opinion that our higher education is oftentimes woefully lacking and not challenging women in business enough. But I am always open to your thinking and comments! Write to me at Steve@QSBJ.org below and I will get your message!

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Article first appeared: www.QuadStateBusinessJournal.com