I recently read ‘Antifragile’ by Nicholas Nassim Taleb. Setting aside his bullish tone that paints him as somewhat a raging narcissist, digging deep provides immense insight into the survival strategies required for anyone who wants to thrive in the face of adversity. In contrast to the increasingly fragile world that we live in, he hails entrepreneurs for their nature in which they stress themselves to become stronger and more capable of dealing with volatility. In short, we need the volatility that arises as a result of risk. This can be attributed to a term called “iatrogenics”, which refers to when a treatment intended to do good causes more harm than benefit.
The Adoption Curve
Processes that you know and make sense often feel like the best. New products or services that enter the market simply become second nature over time. There was once a time when you or your small business continued to write everything down on paper, because we feared for our computer crashing or a document not saving. Many products that become second nature have often been around a lot longer than we know. That’s because many of us fall into the ‘early majority’ or the ‘late majority’ bracket of the adopter’s curve.
As a business owner, sitting comfortable in the late majority adopter’s category could seem like a safe move. However, there are other businesses around you embracing new technology and the opportunities that come with it. In a fast-moving business world, blink for too long and you could be left behind. A conservative, de-risking strategy could quickly become an iatrogenic strategy. At times, a low risk strategy for your business makes a lot of sense. Granted, many of us don’t have the capital to invest in new solutions which will help our business grow over the long term. There’s nothing wrong with that but, as business owners, we need to be open to embracing new processes that streamline our businesses, and create efficiencies wherever possible. So in essence, one needs to make calculated decisions within their business that might appear like risks, but carefully considered, will result in success over the long term.
As with any business expense, we need to consider its return on investment. You may be reluctant to introduce new technology due to the time and cost it takes to implement, alongside the concerns as to whether these outlays will pay off. And yet, now think about those ‘innovators’ and ‘early adopters’. Staring straight into the face of uncertainty, they are the definition of anti-fragile. They will thrive as a result of their openness towards volatility and risk.
When considering a new technological investment, think about its technological elasticity. Will the return you receive eventually outweigh the initial time and monetary investment? Due to the improvements you will receive in productivity, the answer is probably – after all, nothing is guaranteed but why not give yourself the best chance of further successes? As we move from the far ends of the adoption curve back into the middle, the elasticity decreases. For example, our innovators will likely see a large technological elasticity. This is because they are taking a high level of risk, but their first mover advantage will result in a high level of return. In the middle, we see a moderate level of risk as a pragmatist, but our level of return might therefore also be moderate. Lastly, we see our ‘skeptics’ or ‘laggards’ at the far right of the curve. These people often wait for a concept or product to be absolutely proven prior to adopting it. This is an extremely low risk strategy in terms of the product failing to give one a return on investment. However, at this stage, all your competitors are using it and you are well behind the rest of the pack.
Turn your risks and volatility into success. Don’t play fragile and wait for a catastrophe to happen, because when it does there will be terrible consequences. It’s always more beneficial to be proactive, rather than reactive. Small setbacks will build a stronger entrepreneur and a stronger business. Your mini-failures will teach you how to be resilient and ultimately, create a persistent entrepreneur.
Anti-fragile entrepreneurship is the ultimate tautology.
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