How Men and Women Take Risks Differently in Business
When I first looked at the data from Insureon's Small Business Outlook 2017, I wasn't sure if I liked what I saw. Sure, 82 percent of the more than 1,000 small-business owners we surveyed said they are planning for growth this year. But that means 18 percent aren't -- and that's not all. We also found that 68 percent of those with no plans for business growth are women.
The statistics fly against my understanding of entrepreneurs. Regardless of gender, business owners must learn to be comfortable taking risks -- whether that means launching a new product or hiring an employee. Without risk, there's little chance or growth.
My first instinct is to ask, "What's holding women back?" Reading David Sundheim's "Do Women Take as Many Risks as Men?" has helped me realize I might be asking the wrong question. Also president of The Sundheim Group, he raises the possibility that we tend to think of risk in more straightforward, male-dominated ways. If that's the case, maybe it's time to re-evaluate how we think about risk.
Sundheim notes plenty of studies that show men are more likely to take risks than women. However, he also writes that the majority of men define risk-taking in physical and financial terms. That's a problem because it may overlook other kinds of risk. Would these fit your definition of risk?
- Jeopardizing your reputation to do what's right
- Refusing to lower your standards
- Valuing career satisfaction over profit
When you reframe the concept of risk to include these types of actions, women take just as many risks as men. In fact, I see all sorts of women risk-takers in my company. Here are a few examples.
The woman who took the blame. At the monthly sales meeting, one team leader took the blame for something she could have pinned on a member of her team. Her willingness to cop to the mistake, even when it could have hurt her reputation, helped strengthen trust.
The woman who organized a winter-coat drive. One customer-service representative collected winter coats and delivered them directly to homeless people in her neighborhood. It was a lot to take on, but she clearly believed the risk was worth it. While some might've worried whether the workplace is an appropriate place to take a social stance, our team responded enthusiastically. She pushed us out of our comfort zone, and our office is better for it.
The woman who greets every new employee. It might not seem like a big deal, but one employee introduces herself to every new hire. That was much easier to do when we were a company of 20. Now, we number greater than 200. Still, she goes out of her way to welcome everyone -- at their desks, in the kitchen or waiting for the elevator.
The difference in risk-taking between men and women is more than just interesting trivia. It can have a real impact on your bottom line. Think about it this way: People tend to stay where they feel others appreciate their efforts. Recognition makes them happy and leads to increased productivity. Ignore their efforts -- even unintentionally -- and you might see turnover you can't afford.
Of course, some work is harder to measure than others. A salesperson taking a chance that wins a major client is clearly a line-item win, but how do you evaluate risks that don't directly result in profit (or loss)?
Start by asking better questions. For example, our survey focuses on common external indicators of growth. To pinpoint internal growth indicators, you might look at different factors. Has the employee looked for professional-development opportunities, mentored a new hire or taken on an additional task? Maybe she has offered valuable suggestions or created new systems for accomplishing duties. Any of these rising tides can help boost your business.
Employees extend themselves in many different ways. Acknowledging the full range of risks will help employees and your business flourish together.