BUSINESS DEVELOPMENT - If You Are Not At Risk of Losing Your Job, Then You Are Probably Not Doing It Right!

I don’t get it. If I’m at risk of losing my job then that means I am doing my job correctly? Well yes. Too many companies today, and the people that run them, have developed a negative culture on responsible risk. I say responsible risk because I am not talking about taking a high risk flyer into the unknown, I’m talking about conducting your due diligence on an idea, discussing the idea with the appropriate people, and then making a decision to take responsible risk and go forward with it. A company with a management culture that takes punitive measures against a person who takes a responsible risk and it fails is a company that is headed for problems.

Where would the world be if Sony had not taken the risk for a small portable audio cassette player using mini headphones that would be called the Walkman? Or when the entire world played 33 and 1/3 RPM vinyl records for music had Sony not taken the risk on a new format called compact disk? Or how about when everyone was using 5 and 1/4-inch or 8-inch floppy disks had Sony not introduced the 3 and 1/2-inch plastic jacketed floppy disk and disk drive?

If you are a person who is overly cautious or someone who is afraid to take any kind of responsible risk, then you are exposing yourself to a potential termination. Last month, I wrote about the Compensation Paradox and the Cost to Company (CTC) of an employee to his or her company. In that article, I wrote about what a person’s perceived value is by his or her manager.

If you are a person who stays quietly out of the way and never exposes himself or herself to any type of responsible risk decision, then your perceived value is not in any way close to the perceived value of a person who is always looking for the next great idea and trying new ideas that have passed the responsible risk test.

Responsible risk takers are never 100% successful. Some ideas flop. But some ideas don’t flop and go on to create tremendous value for the company. That’s why if you are not at risk of losing your job, then you are not doing your job correctly. You’re not taking any responsible risk, and thus you’re not creating value.

AT&T in its original form, although a monopoly prior to its break up in 1984, was still one of the world’s leading technology companies through Bell Labs. They developed the transistor, the cell phone, the laser, the CCD, and a multitude of other technology developments resulting in seven Nobel Prizes. I left Sony to join AT&T as a Group Vice President because of AT&T’s technology leadership.

So where is the former AT&T now? It isn’t anywhere. It was broken up into three pieces by its Chairman and CEO, Bob Allen, in 1995. Eventually, AT&T was acquired by Southwestern Bell, Lucent by Alcatel in France, and NCR Corporation became its own company in a much smaller footprint.

One of the reasons that AT&T was broken up was because it was failing. It was failing because it had a risk adverse company culture. One of my responsibilities as a Group Vice President was to assess new consumer products technologies being developed at Bell Labs and to determine if these technologies could be developed into actual businesses. I was like a kid in a candy store. I had the best job at AT&T. Or not.

Every time I found a new technology at Bell Labs that I believed strongly could be developed into a real business, I made a formal business plan presentation to AT&T senior management. And every time I made a presentation, these dinosaurs found reasons not to take a responsible risk and develop the technology platform into a business.

Over the past 10 years, I have watched company after company introduce new products and technologies that we had at AT&T 20 years ago. But because AT&T was so risk adverse, it never took advantage of its great potential as technology developers and innovators and never developed businesses around them. Don’t let yourself become a personal AT&T and fail because you will not take responsible risk. Be more like a Sony. Take responsible risk and you will be doing your job correctly!

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John A. Bermingham is currently the Executive Vice President & COO of 1st Light Energy & Conservation Lighting, Inc. He was previously Co-President and COO of AgraTech, a biotech enterprise. Previous to that, he was President & CEO of Cord Crafts, LLC, a leading manufacturer and marketer of permanent botanicals. More previously, he was President & CEO of Alco Consumer Products, Inc., Lang Holdings, Inc., and President, Chairman, and CEO of Ampad, all of which he turned around and successfully sold. With more than 20 years of turnaround experience, he also held the positions of Chairman, President, and CEO of Centis, Inc., Smith Corona Corporation, and Rolodex Corporation as well as turning around several business units of AT&T Consumer Products Group and served as the EVP of the Electronics Group, and President of the Magnetic Products Group, Sony Corporation of America. Mr. Bermingham served 3 years in the US Army Signal Corps with responsibility for Top Secret Cryptographic Codes and Top Secret Nuclear Release Codes, earned his BA in Business Administration from Saint Leo University, and graduated from the Harvard University Graduate School of Business Advanced Management Program.