Playing it safe vs taking risks – leaders persective

The quality of life and many of the comforts we enjoy today could not have been achieved if not for some leaders who dared to challenge the unknown, experiment and innovate by working passionately to do something incredible despite the seemingly heavy odds on the probabilities of success. Achieving the impossible and keeping ahead of competition imply high risk taking that has seen some firms getting away with it and catapulting to the top in leaps and bounds while some have succumbed in chaos and uncertainty bringing ruin to their investors. Hence, some leaders opt to play it safe for sheer survival while comfortably copying any ideas that seem to work well for others.

Being a real dynamic leader rather than a play-safe leader means moving out of your comfort zone and exposing yourself to all types of pressures from within your own community as much as from the external sources. Even during normal times, the relentless pressures of it are enough to make you feel friendless, isolated, and highly vulnerable; but at times of economic downturns and market crashes, you could be stretched to the limits of your endurance and resourcefulness.

At such times you may be blinded by the pressures in seeing beyond your self-imprisonment within your own accountabilities and responsibilities. These are times when even the most ambitious real leaders have to restrain themselves and lie low to tide over hazardous situations to come back strongly to fight another day instead of sinking under the pressures of impossible circumstances.

For a leader setting his/her goals on steering an organization from sustained growth and mediocre greatness to spectacular growth to be at least “one of the greats in the industry” (if not the greatest), such feats cannot be achieved by playing safe all the time. Such success only favor the brave and the ones who are willing to take calculated risks and make quick decisions and stick by them however critical and unpopular they may be. Such leaders are essentially the big dreamers with an insatiable yearning for challenge, unlimited potential for imagination and innovativeness, and a knack for spotting opportunities and grabbing them at the correct time. They will be leaders who are not afraid to make mistakes and profit from them as part of their learning and development. They will of course be inspirational leaders of men and not mere managers of functions.

Playing safe should be an exception rather than the rule for any dynamic leader.

Now, let us look at a real life example of a CEO who called a halt to the play safe policies his firm had been pursuing for some years and started adopting an aggressive approach to pull it back to the top from the depths it had fallen into, as a result.

Safeway stopped playing it safe to revert back to the top:

In the early 1980s, Safeway, the world’s largest food retailer was on a downslide with regional chain giants like Randall’s, Rayley’s, Giant Foods and Tom Thumb already eating into its market shares in Houston, Washington, Sacramento and Dallas respectively. Safeway’s 6.6% market share in Los Angeles in 1980 was less than half of what it was in 1970. Analysts view this situation as the outcome of a timid leadership oriented strategies Safeway had been following since the 1970s, especially with regard to blind adherence to government regulations, reluctance to advertise and match competitors’ prices with aggressive discounts.

Taking over the reins as CEO in 1980, Peter A. Magowan immediately set about making drastic changes. The following figures bear testimony to the impact his dynamic leadership made on the turnaround of Safeway to be a market leader once again: The three-year period 1978 to 1981 saw Safeway’s net income plummeting by 32%; but by 1982, it was already recovering by recording a massive 47% improvement over 1981. The company stock had more than doubled in value over the last three years. While acknowledging the change in the company’s strategies and performance, Magowan shied away from taking the full credit himself by saying that it was the management team as a whole and not the CEO who took all the decisions.

The changes he brought about through creative retailing did not come direct from textbooks, but through his experience in the marketplace. He had left John Hopkins in 1968 to join Safeway as an Assistant Store Manager, where he worked his way up to be its CEO within 12 years. Commenting on Safeway’s success since becoming its CEO, Magowan says that Safeway had a tendency not to experiment; and that they would watch what someone else would do and copy it cautiously if it appeared to be a good idea. He further states that they had to become more aggressive merchants and get price-competitive, drop their over-reliance on private labels and engage in experimentation.

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