Contractors and Business Growth: Taking Risks and Facing the Consequences

Take a moment to reflect on your contracting business. Has it flourished over the years since you started it? Was it all smooth sailing or were there rough patches?

Is the current outlook rosy or are their clouds on the horizon? How is it that you got to where you are?

Through conservative, metered actions, or through bold decision making?

It can be hard to balance the two in a world where loud voices are aggressively calling for diametrically opposed views on how to run - and build - a business.

All the same, there is a time and a place for risk-taking and it can make all of the difference for the long-term viability of a business.

Here are some high-level takeaways, taking inspiration from one of the greatest minds ever to visit the world of business.

Quick Decision Making: Living with the Consequences

Elon Musk, founder and CEO of SpaceX, and currently the wealthiest individual in the world, may be a polarizing figure, but he is undoubtedly one of the most influential businessmen in history.

He’s also no stranger to risks and risk-taking in business. According to Musk, his philosophy is to make quick decisions and to live with the consequences.

This naturally involves the potential for making mistakes.

His whole philosophy is that some of these decisions, quickly made as they are, are going to be mistakes. The point is to learn to navigate the consequences when they are not what might have been desired.

Part of this has to do with accepting the fact that you will make mistakes, and that you will be wrong - the point is to accept the possibility of being wrong without being cocky or confident about being wrong - or being defensive. Owning mistakes is one of the only ways to learn from them.

Besides that, making mistakes is a necessary externality associated with quick decision making. One cannot make quick decisions and be right at every turn. So, to make quick decisions and profit from them, you must be ready to face the inevitable consequences of some decisions, made quickly, but unfortunately in error.

On the flipside, the consequences of quick decision making in the wake of a good decision are undoubtedly positive. We need not fear these, for they are the fruits of success. If you make a bold decision to serve a new market or to pour resources developing a new product or line, and it pans out, you and your business thrive.

Additional Principles for Effective Business Management

While it is apparent that Musk is an advocate for making quick decisions and dealing with the fallout (both positive and negative), to summarize his philosophy of business without addressing some of his other maxims would be erroneous at best.

One thing he considers imperative is that managers must have applicable, technical experience. Those in management cannot manage effectively if they do not understand, and do not have a demonstrated ability to execute, the work of their subordinates. A manager of a fleet of pilots must know how to fly a plane or he would be like “a general that does not know how to wield a sword.” That is to say, conceptual knowledge, though valuable, must be substantiated by practical knowledge.

Another “lead by example” sort of philosophy espoused by Musk is that leaders must be willing to do the work they are asking from their subordinates, and that extends to risk taking. The leaders reap part of the profits, so they must be willing to pay part of the price. You cannot ask employees to take risks if you do not share some of the burden when the risk yields unpleasant consequences.

His approach to problem solving is also collaborative and not peremptory. He recognizes that those with the best experience are the people in the roles delivering the end result (service or products, it doesn’t matter). What does matter is involving them where their experience is valuable.

Another nugget of wisdom with respect to human resources has to do with hiring based on character, not on experience. Experience (and skills) can be taught or gained on the job. Attitude, or more fundamentally, values, are much more central to the individual. These things cannot be “retaught” to an adult. The adult either comes with the right frame of mind or he (or she) does not. Hire for character, and coach for skills.

Elon Musk is also emphatic that leaders need to learn to differentiate between signal and noise, and to pay attention only to signal while tuning out the noise. To be specific, signal is valuable information and noise is what competes for your attention without returning any value. Going along with this is Musk’s other exhortation to know who to listen to, and to know when to listen rather than trusting yourself.

Last but not least is Musk’s ultimate pointer: you need to be able to accept risk. Change doesn’t come without risk, and success doesn’t come without change. He is emphatic that stagnation causes relaxation, and that to focus on growth, we must be able to accept changes and welcome the risk that comes with them - because a change is required for success.

Spartan Equipment: Your Source for Skid Steer Attachments

The importance of risk taking in building a business from the ground up cannot be understated, and one needs not even be familiar with Elon Musk’s personal philosophy to recognize that truth.

Here’s another of his suggestions for success: Never give up.

Sound familiar? How about Never Surrender, the maxim to which we have adhered since our very beginning?

Fast forward to the present and Spartan Equipment is one of the most successful suppliers of tractor, excavator and skid steer attachments. Though we can’t entirely credit an external source with this inspiration, for our part we’ve Never Surrendered and keep to the principles of integrity and relentless grit that have made our brand great.

If you’ve been underwhelmed by suppliers of skid steer attachments in the past, get in touch with us and we’ll help you find attachments compatible with your machine that can take on any job you throw at them. Call us at 1-888-888-1085. We’ll be waiting.