Peter Drucker once said in regards to entrepreneurial decisions that there is no right answer, but there is the ability to take the right risk. He said that decision makers must innovate and change the trend rather than follow it.
We at ITR Economics obviously take this approach to heart as we work with business leaders around the world. It is one thing to know what is happening; it is better to know what will be happening; and it is best to us that knowledge to change how the enterprise faces the future trend.
I have found over the years that it takes courage and a certain sense of optimism to take on risk given the reality that the future is not guaranteed. Courage comes from experience as well as character. CEO optimism is a function of character and culture. It is concerning the latter that I write today.
Americans are typically optimistic. We believe in a better tomorrow and that we can have a positive impact on that tomorrow. That belief system is part of what drives us to take risks, make decisions, and generally grow.
That optimism is not easily found in Europe anymore. The pessimism regarding the economic situation there is almost universal. I have the privilege of working with European business leaders who are every bit as intelligent and caring as their U.S. counterparts, but they are not optimistic about the EU economy. That means they are not willing to take risks and a business that takes no risks is one that will slowly lose market share to aggressive optimists.
Now may be a great time for our U.S. readers to look to Europe with an eye to capturing market share while our European counterparts are hunkering down in anticipation of a storm that may not materialize. U.S. readers may also want to consider buying European competitors who have grown weary and have lost hope.
Banks and private equity firms have the cash. Making vertical or horizontal acquisitions is a classic ITR Phase D Management ObjectiveTM, and Europe is in Phase D. Act on measured risk now and reap the benefits in a few years.
