If your dreams are bigger than you—and most great dreams are—then you must know how to take calculated risks on people.
After all, you can’t predict what they’ll do. You can’t make decisions for them. You can’t always know what drives them. But you won’t get far without them. If your dreams are bigger than you—and most great dreams are—then you must know how to take calculated risks on people.
I spend time with a lot of successful entrepreneurs. These people, who took huge chances to pursue their goals, are now reaping the rewards of their decisions. From our conversations, I’ve uncovered two things about the attitudes these self-starters hold toward risk: They’ve grown comfortable with it, and they’ve learned how to accurately assess it.
I figured out long ago that I would need help in my own ventures. My vision most definitely exceeded my capacity to pull it off. But adding another face to my team, giving an employee additional responsibility, or partnering with someone in a new way is a big plunge. What if the person doesn’t work out?
I needed to minimize the risk while maximizing the potential. To accomplish that, I identified attributes that lead to success and compiled questions to reveal whether a candidate possessed them. I’m happy to report I’ve assembled a group of people who were well worth the investment. Here’s my formula, and you can borrow from it, add to it, and come up with a model that secures the right team for your mission.
It all starts here. When you have a task that needs to be done or a role that needs to be filled, you’ve got to determine whether your candidate can handle it. Of course people can grow and learn, but you probably don’t want to ask a wordsmith to take on a task best suited for an accountant. There’s a difference between creating opportunities for development and setting someone up for failure.
Understanding a person’s capabilities takes time. You need to know his or her talents, training and coping skills. This requires conversation, assessments and a close look at his or her track record.
To help determine people’s capacities, consider: Do they have the skills and training to achieve the goal? How well have they delivered on similar tasks in the past? How have they responded to stressful situations? When they failed, what have they done to learn from the experience, pivot and try a new approach?
Nobody wants to be around a person with a bad attitude, mostly because it’s hard to achieve positive results with a negative mindset. If you’re going to take a chance on someone, look for glass-half-full types.
Thankfully this characteristic is pretty self-evident. Spend a little time talking or working with someone, and you’ll be able to discern his or her attitude through words and actions. Look for optimism over pessimism, positivity instead of negativity and a “yes” mentality.
To determine a person’s attitude, you need to see how he or she deals with adversity: Do they see the bright side of situations? Can they fluctuate and adapt in stressful situations? What words do they use to describe past successes and failures?
One person with passion is better than 99 people with interest. The passionate are self-motivated and bring a level of energy that infects the team and inspires everyone to achieve better results. To assess this factor, you need to figure out what makes a person tick. If it’s an internal drive and that motivation will contribute to your venture’s success, then you know you’ve found someone worth the risk.
To determine a candidate’s level of passion, consider: Is he driven? Highly motivated? Must he be told what to do, or does he figure out the needs for himself and then attack them with gusto? Why does he want to partner with me?
Risk hinges on trust. Before you invite a person into your circle, you need to believe you can trust him or her. Start by reviewing the person’s history. This is where references and track records come in; character can’t be evaluated through words alone. You need to know whether a candidate’s past behavior matches his or her stated values. People of character and integrity demonstrate honesty and reliability. They follow through on their commitments.
To determine someone’s character, ask yourself: Do the values she communicates align with mine? Does her past behavior align with those values as well? How well has she met expectations or kept commitments in the past?
When you take a risk on someone, he or she becomes a part of your team, so be prepared for the group dynamic to change. One negative voice can send productivity into a nosedive, while a supportive voice can drastically improve a team’s inner workings. To know whether a prospective partner is a team player, check with the organizations he or she has worked with in the past. Again, references can provide valuable insight because good team players tend to leave lasting impressions.
To determine a candidate’s ability to work well with others, look at his or her past: What do previous partners, colleagues or employers think? Did the candidate’s previous team experience more wins than losses? How does this person describe previous colleagues? (If they speak negatively about them, it’s a red flag.)
A successful entrepreneur knows calculated risks are the cost of doing business. When it comes to human capital, a careful evaluation of prospective partners will minimize your risk, allow you to move forward with confidence, and reap the greatest reward in business: Building new relationships with like-minded, motivated people.
This article originally appeared in the October 2016 issue of SUCCESS magazine.