While listening to a podcast by Howard Marks, I came across the phrase “Dare to look Wrong.” The concept struck a chord with me, as it challenges the pervasive tendency to avoid risk at all costs. Marks emphasized that robust risk control—not an aversion to risk—is essential for success. This insight has profound implications, not only in investing but also in corporate life and personal growth.
Marks’ perspective reshaped how I viewed decision-making. He argued that risk is not inherently harmful but reflects a range of potential outcomes. As he puts it, “Risk is nothing, but more things can happen than happen.” This statement highlights the unpredictable nature of risk and its potential to yield extraordinary results if managed wisely. I tried to demystify few jargons here.
To illustrate, Marks shared an example from the Global Financial Crisis (GFC) and the early days of the COVID-19 pandemic. During these crises, markets plummeted, and fear dominated. Most investors, paralyzed by uncertainty, sought refuge in safe havens. Yet, Marks argued, these moments of widespread fear presented unique opportunities.
The lesson was clear: maintaining composure and rational thinking during times of fear is crucial for identifying opportunities.
Analysis-Paralysis and the Cost of Inaction
Reflecting on my own experiences, I realized how often fear of failure had trapped me in analysis paralysis. When my objective became “none of my decisions fail,” I found myself obsessing over eliminating every uncertainty. The result? Mediocre outcomes and significant opportunity costs.
As I examined my thought process, I recognized the underlying issue: a fear of looking incompetent in front of others. This fear was not unique to me but was deeply ingrained in the corporate culture I’d experienced. Middle management, in particular, often faces judgment based solely on outcomes. Successes are shared, but failures invite blame. There’s little incentive to take calculated risks; the culture rewards playing it safe.
Marc Andreessen and Ben Horowitz’s assertion that “culture is not what you say, but what you do” resonates deeply here. In organizations, risk-averse behaviors become Pavlovian associations—reinforced through repeated cycles of fear and blame; even as personnel change, the underlying behavior persists, trapping organizations in a risk-averse mindset.
“You can’t take the same actions everyone else and expect to outperform” – Howard Marks
Transforming a Risk-Averse Culture: My Leadership Journey
I embraced this behavior without even knowing the fancy phrase “Dare to Be Wrong” to break free from the cycle of risk aversion. However, I realized I could only be fully myself when actions and outcomes were within my sphere of influence. Creating a culture of calculated risk-taking requires intentional effort and resilience. Here’s how I approached this transformation:
Fostering Psychological Safety
One of my primary goals was to shield my team from the fear of failure. I consciously absorbed the potential fallout from unsuccessful decisions, ensuring that my team felt safe to experiment and innovate. By protecting them from external criticism, I created an environment where they could take risks without fear of retribution.
This approach sent a powerful message: failure is a natural part of growth. It’s not about being perfect but about being bold enough to try, learn, and evolve. Psychological safety became the cornerstone of our team culture, enabling us to think creatively and act decisively.
Encouraging Rapid Experimentation
I prioritized rapid experimentation over exhaustive analysis. This meant encouraging my team to test ideas quickly, learn from the outcomes, and iterate. While this approach didn’t guarantee success, it allowed us to adapt and respond to challenges more effectively than a risk-averse strategy ever could.
Writing, Journaling, and Premortem Analysis
Sometimes, there’s a risk of mediocrity creeping in, especially when the focus is on Rapid Experimentation. I have observed that in the name of “fail fast,” sometimes insufficient thought is applied, with people relying too heavily on the MVP (Minimum Viable Product) terminology. To counter this, I learned to write down my thought process, journal decisions, and perform premortem analyses. This approach helped me and my team own the problem entirely and build hypotheses about what could go wrong and why.
When things did go wrong, these practices created a form of muscle memory. By revisiting and analyzing past decisions, we continually improved the quality of future decisions. This process minimized mediocrity and ensured that the team and organization grew in the right direction.
Changing People to Change Culture
Transforming a risk-averse culture required introducing new perspectives. I brought in individuals who shared my vision for bold, innovative thinking. These change agents catalyzed behavioral shifts within the team, challenging existing norms and inspiring others to think differently.
This process wasn’t easy. It involved tough conversations, recalibrating expectations, and overcoming resistance. However, the payoff was worth it. Fostering a culture that valued innovation over conformity unlocked a more dynamic and forward-thinking way of operating.
Learning from Setbacks
Some of my decisions yielded the desired results. Some led to professional repercussions, and others required complex course corrections. Yet, I remained focused on preventing these setbacks from deterring the team’s innovative spirit. I treated each failure as a learning opportunity, reinforcing the importance of resilience and adaptability.
Lessons in Risk Management
My journey reinforced the idea that daring to be wrong is not about reckless decision-making. It’s about managing risk intelligently and balancing potential rewards with calculated precautions. Howard Marks’ philosophy echoed throughout this process: robust risk control is far more effective than avoiding risk altogether.
Here are some key takeaways:
- Fear of failure stifles growth: Both individuals and organizations must confront this fear to unlock their full potential.
- Leadership sets the tone: Creating a culture of psychological safety and innovation starts at the top.
- Experimentation drives progress: Rapid testing and iteration are essential for navigating uncertainty.
- Failure is a stepping stone: Learning from setbacks is critical for long-term success.
The Broader Implications
Risk aversion doesn’t just limit individual growth; it can cripple entire organizations. When leaders judge solely on outcomes, they discourage bold thinking. Over time, this creates a systemic aversion to risk, stifling innovation and causing mediocrity to prevail.
Changing this dynamic requires a fundamental shift in perspective. Leaders must embrace the idea that calculated risks are necessary for progress. They must reward experimentation and treat failure as an integral part of learning. Only then can organizations break free from the constraints of fear and unlock their full potential.
The Courage to Keep Moving Forward
The essence of “Dare to Be Wrong” lies in courage—the courage to take risks, to fail, and to keep moving forward. It’s about creating an environment where people feel empowered to think boldly and act decisively. For me, this philosophy has been transformative, both as a leader and as an individual.
By daring to be wrong, I’ve learned to embrace uncertainty, make better decisions, and inspire others to do the same. It’s not about eliminating risk but about navigating it intelligently and confidently. In the end, it’s this willingness to take chances that drives growth, innovation, and success.