Our president Goldy Hyder recently spoke to a group of young professionals at an event hosted by the Ottawa chapter of the Young Canadians in Finance (YCIF). The focus of Goldy’s talk was how taking risks can help shape your career and ultimately your entire life.
A full transcript of Goldy’s speech can be found below.
The truth is I should not be here tonight.
I was born in Hyderabad, India – a very traditional community, one which was facing challenges.
Troubled by the unethical practices he was seeing in his profession, journalism, my father decided to leave everything he knew and move his family to the other side of the globe.
It was 1974.
Like many immigrant families, we came here searching for a better life – but not knowing what our real prospects could be.
When we arrived, my father’s professional experience, qualifications and credentials were largely undervalued.
The only people we knew here were my Aunt and Uncle, who had only recently arrived themselves.
In short, it was a massive risk.
My parents persevered through the early, difficult days by embracing entrepreneurism.
Together they built a $20 million insurance business, now led by my younger brother, with fourteen locations and dozens of employees around the Province of Alberta.
High risk, but high reward.
I could have stayed in Calgary with my family, and taken over the family business with my brother, but fate intervened.
It was December 1999 when I received an unexpected call that started with “Goldy, its Joe Clark. Can you please fax me your CV?”
Some of you may recall that Mr. Clark had been re-elected as the Leader of the Progressive Conservative Party of Canada – a party with only 19 MPs in the House of Commons.
Mr. Clark had called to ask me if I would be willing to come work for him in Ottawa to help rebuild and restore our party.
At the time, my wife and I had three daughters aged six months, three and five years old.
I had never lived in Ontario, let alone Ottawa, and, more importantly, I had zero experience as a political staffer.
Still, I took the job.
Not surprisingly, it was my father who encouraged me to “pursue opportunity when it comes knocking.”
For the first six months my wife remained in Calgary as a single-parent.
We didn’t come here for the money – which was a modest government salary – or the promise of victory – as the party was lagging badly in the polls.
We came to Ottawa because it seemed like a risk worth taking.
Nearly 15 years later, I am now the President of a $50 million agency – the largest public affairs consultancy in Canada.
It would not have happened had we stayed in Calgary.
High risk, high reward.
I share these personal examples not out of an inflated sense of self, ego or vanity – but to highlight a point.
I am increasingly struck by the number of young Canadians at the outset of their careers who are unwilling to move to another city, let alone to another province or country.
While not everyone has to move great distances to follow their dreams, anyone who wants to realize their dreams must be prepared to do so if required.
Fewer and fewer Canadians, it seems, are prepared to take risks in general (irrespective of whether a move is required) when it comes to their careers or their investments – and that is holding us back.
We are becoming too risk averse as a country and as a people.
In fact, a recent study by Deloitte showed that Canadian business leaders are, on average, 18% less tolerant of risk than our American counterparts — this despite our current positive economic climate.
If you’re complacent, you’re complicit.
More and more often, we hear talk about risk mitigation strategies and ‘hedging our bets’.
There is nothing more disheartening to me than to meet a bright young Canadian with enormous potential who has settled for a career on the basis of ‘job security’.
Now, I am not suggesting that any of you should quit your jobs tomorrow – in fact my lawyer has expressly asked me to make that point clear!
What I am saying is that you should not stay in a job, profession, city or country solely because it’s a ‘safe bet’ or ‘sure thing’.
In many ways, we should consider our careers like investments in the market.
Security and certainty are the other side of the risk/reward coin.
You can invest in bonds, secure in the knowledge that you will never lose your money – but knowing it will never truly grow.
You can invest in stocks, risking the possibility that you could lose money – but with the potential to reap large rewards. In that sense, risk and security are on the same spectrum – and we can choose how far to one end or the other we go in the course of our lives.
Each of us has to determine for ourselves what our risk threshold should be based on such factors as what we and our families can realistically do.
In my view, you can play it safe – or play to win.
I sometimes hear people claim that they took a risk because they had “nothing left to lose”.
If you have nothing left to lose, you aren’t taking a risk.
Real risk requires potential loss.
And, because of that potential for loss, taking risks doesn’t mean being reckless.
As General George Patton once remarked: “Take calculated risks. That’s quite different from being rash.”
All of us rely on instinct at times, I certainly do.
But anyone who is considering taking a risk with their lives, career or investments – must do so on the basis of some type of calculation.
Even if you can never completely mitigate risk, you absolutely need to assess risk.
Quantifying risks means honestly measuring potential vs. loss.
In this, as in all things, even the most thoughtful and precise calculations can never give you a perfect answer.
In the end, it requires a leap of faith.
All I’m saying is look before you leap.
So, to borrow Patton’s phase, what are the “calculated risks” worth taking in business today?
The first, in my opinion, is risking global.
In the past decade, we have seen an incredible change as technology has made the world a much smaller place.
I’m a father of teenage daughters, and I’m constantly amazed by how global they are in their thinking.
One of my girls recently asked me about the debate over roaming charges for cell phones.
When I explained that different countries had different rules and regimes and rates – she was dumbfounded.
It made no sense to her.
That is the mindset that her generation will bring to the world – divisions between countries and continents are as arbitrary as they are archaic.
It is a view of the world fueled by the fact that they have entire universities worth of information on their smart phones.
How then do we compete when everyone has unfettered access to the same information?
The answer is experience.
While my daughters and I can all find the same information online, the difference is that I have more experience using and applying it.
Experience is therefore my competitive advantage, and it is not something that can be downloaded.
You can read everything about India, or watch all the YouTube videos about it you can find, but you will never truly understand what India is like until you’ve actually gone to the country and seen the chaos in the streets.
They call it ‘experience’ because you have to ‘experience’ it.
That is why I say going global is a calculated risk worth taking – because it gives you a competitive advantage.
Now, there will be those who will say that because of technology they can do business around the world from the comfort of their homes.
Perhaps – but not well.
There will be others who say that they can be successful by ignoring the temptations of the foreign markets and focusing their efforts on being the best in a local market.
All they are doing is imposing limits on their success.
If I was 10 or 20 years younger, I would be taking a risk on a global opportunity – even for a year or two.
There is marginally more risk in moving to Dubai, Mumbai or Shanghai then there is in moving to Montreal, Toronto or Vancouver. Yet the potential rewards are far, far greater.
The company I work for, Hill+Knowlton Strategies has 89 offices in 52 countries.
It is not uncommon for us to send Canadians to offices around the world – including Ankara, Brussels, Beijing and Dubai where some former colleagues of mine are now working.
When they arrived in their new offices, their experiences in Canada put them on solid footing.
If and when they return, they will do so with an undeniable competitive advantage over those who stayed here.
Don’t get me wrong, I am a proud Canadian – and I am grateful each and every day that my parents brought me here.
I am not blind to the many natural advantages we have here – from the safety and security of our communities to the quality of our health care and education systems.
None of us should abandon Canada, but the best way for us to be great citizens of this country is to act like citizens of the world.
We desperately need new markets for our exports – both goods and services – and Canadians have to go open them.
We desperately need new immigrants to keep taking risks to come here to help fill our skills gaps – and Canadians have to find them.
We desperately need foreign investment dollars to develop our resources – and Canadians need to go raise them.
The world is waiting for us – but it won’t wait long.
The second calculated risk worth taking is risking longer term.
In business, and in life, there is always the temptation to focus on the ‘next big thing’ – the latest release or what’s ‘new’.
But if you’re focused on the next big thing – what’s going to happen in six months or a year from now – you’re already too late.
Even with the dizzying pace of change and innovation in Canada – your lead time on something has to be much longer.
To have success a year from now, you had to start a year ago.
Forget about the next big thing – it’s already been designed and the creators are meeting with their IP lawyers.
Think about the thing after that or, better still, two after it.
Our time horizons are too short.
I will never forget the first time I worked on a major transaction with a Chinese energy company.
When discussing their plans for a particular investment, one of the senior executives told me about an initiative that would clearly require a pipeline.
When I told him that there wasn’t a pipeline, and wouldn’t be one anytime soon, I will never forget what he said: “But there could be one in 50 years.”
Fifty years. Not fifteen.
This is not unique to the Chinese; this type of thinking is common among many Asian cultures – including Korea, India and Japan.
And, in case your subscription to The Economist has lapsed, you should recognize that those happen to be the markets that will define this century.
The decisions you make, the risks that you take, are significantly different if you’re looking 20 to 50 years out.
First, your baseline assumptions about what is possible will be different – both in terms of what can be achieved in that time as well as what new technologies may exist.
Second, your financial models will be dramatically different.
If you don’t need or expect to be profitable – let alone successful – in a year or two, you will make very different choices than if your plan is to be successful longer-term.
The risks are different because the information is more speculative, based on projections which may or may not be as accurate as those you could make for a five year plan.
Taking longer term risks also requires patience.
It is not like flipping stocks or houses – it isn’t about instant gratification.
It can sometimes take years before you know whether a risk has truly paid off.
All the more reason to start now.
Risking now is the third calculated risk worth taking.
Despite being six years out from the start of the Great Recession, our recovery is still slow and tepid.
There are promising signs that U.S. housing might pick up – potentially signalling greater strength in their economy as a whole.
Here at home, the federal government is negotiating trade agreements with Europe, Korea, Japan, India and through the Trans Pacific Partnership.
Those deals are veritable gold mines of unrealized potential around the world.
But many of the blue chip Bay Street companies are playing safe, sitting on significant stockpiles of cash – still avoiding the uncertainty of the market.
Moreover, because unemployment has remained fairly constant a lot of people are worried about leaving a secure job out of fear that they won’t find another.
In the same way that we would counsel an investor to ‘buy low, sell high’ – now is the time for risk.
If all your competitors, personal and corporate, are playing it safe – now’s your time to play to win.
It is the risk-takers, not the risk averse, who are going to lead us out of the global economic downturn.
In the end, that’s my question: Will you be among them?
What risks are you prepared to take today to realize your full potential tomorrow?
Which of you is going to be standing here where I am tonight at a YCIF function in 2019?
I can tell you this; it won’t be the person who slogged away at their desks for the next five years, getting slowly and progressively better at what they’re doing today.
It will be the person who left here, made an honest assessment of their potential and took a risk on themselves.
As I look around this room, I can freely admit I’m envious.
I don’t know many people here but I know that you’re all young and that you all have an interest in finance.
I know you recognize the importance of networks and relationships.
And, I know you’re willing to risk a night of your life to listen to some guy speak on the off chance he says something worth hearing – instead of sitting at home watching the Olympics.
I’m envious because you’re at the moment in your lives and careers when you are best able to take risks.
I’m envious because I know that at least one of you is sitting there now thinking about the idea you’ve been keeping to yourself – one that could be a million, or billion, dollar idea.
To that person, to all of you, my message is this:
Do it. Do it now.