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In 2008, I sat in a meeting where a gentleman narrated how, in the early 1990s, he left a “Big 3” audit firm to join a struggling financial institution as a Finance & Strategy Director. Central Bank of Kenya had declared the financial institution technically insolvent and had therefore called the directors, management and major depositors for a meeting to inform them of the impending placement of the institution under statutory management (receivership). The gentleman, in his late 20s in the early 1990s, managed to convince the Central Bank Governor to allow him develop a rescue plan. He got his request and the plan was accepted by the shareholders and the Central Bank. The plan involved amongst other things, conversion of deposits into share capital and sale of non-earning assets with a view to improving liquidity as well as refocusing from mortgage finance to short-term lending.

The gentlemen’s peers and close family members were not convinced and thought that he had made a fatal career decision. They could not understand how he could abandon a six-digit salary from an international firm to go to an unknown and struggling institution where the CEO was earning less than KES 30,000.00. The gentlemen held on to his guns and today he is a household name in the Kenyan financial sector.

In 2018, I met another gentleman who was unhappy with the working environment in a tier one bank where he was working as a junior manager. Unrealistic performance targets, high octane organizational politics, unsupportive bosses and limited growth over a ten-year period were some of the reasons why he felt unhappy. He had however declined 3 job offers – after being head hunted for all of them – over a three-year period for fear that he may move from the frying pan to the fire. In addition, he did not conceptualize himself working and succeeding in a smaller bank bearing in mind that some Tier 2 and Tier 3 Banks had struggled after the collapse of Chase Bank in 2016. At this time, he was seeking an opinion about a fourth offer from one of my former employers.

During our discussions, I desisted from giving him a definitive answer in regard to whether he should take or decline the offer. I however discussed with him the pros and cons of both his current and prospective employers. We ended up concluding that there were risks and rewards in both choices. He could take up the new offer, excel as a big fish in a small pod and get noticed by another big pod or he could also struggle to fit into the company’s culture, lose his job, and sink for good – a fate that had befallen many who had joined the prospective employer. On the other hand, staying with the Tier One Bank could offer him the comfort of a familiar environment where risk of losing his job was minimal while chances of professional growth were low. He eventually decided to take up the offer and manage the risk associated with the company’s culture. The reward for this risk was a more senior position and higher pay. The risk paid off since he stayed with the new employer for less than 3 years since he was poached by another Tier One Bank on a higher position and salary.

The two gentlemen represent two categories of risk takers namely high and medium risk. High risk takers will make a move and then think about the consequences later while medium risk takers will consult widely before making a move, In the process of consultation, medium risk takers may lose some opportunities. High risk takers may jump into trouble when they take uncalculated risks for example when they move from a stable to a struggling employer probably on the basis of higher pay or higher position alone. However, when things work out, they normally live to tell very inspirational stories like the one about the gentleman who joined the struggling financial institution.

The third category – low risk takers – represent a group of persons who seldom dare seek opportunities outside familiar territory.  They constitute persons who would rather suffer all their working lives than change jobs or quit for business. For example, I know some people who joined the banking sector in the mid-1990s, have stuck to one employer where there are limited growth opportunities and are stuck in supervisory or junior management positions over 25 years later. Not surprisingly, they frequently complain about poor pay and working conditions.

From the foregoing, it is clear that changing employers or occupations requires some level of courage and constitutes risk taking. Job losses emanating from failure to fit in as well as risk of failure to succeed in business are real and have had near fatal consequences on some careers. On the other hand, staying put may not require any courage but still constitutes risk taking. While staying put may look like low risk since one stays in familiar territory, it may still be a high risk when lost opportunities for growth are taken into account. What is therefore required is calculated risk taking – seek information and weigh options before making a move. One may never be sure all the time but in most cases, calculated risk taking pays off.

Dr. Weru Mwangi is the CEO & Lead Consultant at Ultimate Management Solutions, a firm specializing in training & consultancy in Finance, Governance, Strategy, Risk Management and Leadership Development.  He can be contacted on weru@umslgroup.com  

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