Kenny Rogers’ song “The Gambler” has a line:
“you’ve got to know when to hold ’em, know when to fold ‘em, know when to walk away, know when to run”.
We know he was referring to a poker game, but business is a lot like poker. We have to make the same decisions that a gambler does. We have to know when to hold and continue investing in a plan, project or promotion. Know when to fold when we are draining time and money with no hope for success. And sometimes we walk away, but at other times we need to run!
When things aren’t working well do you know when it’s time to hold, fold, walk away or run?
In my past life in broadcasting I remember my staff dreading when I would go on vacation. You’d think they would be happy to have the cat away, (so the mice can play!), but they knew that when I went on vacation I would come back with a new plan, project or promotion, (or create a new organization!), and that would mean change (and more work!).
As entrepreneurs, we are often dreamers and have the gift of creativity and innovation. We are born risk takers and as my favorite President’s Teddy Roosevelt said:
“Far better it is to dare mighty things, to win glorious triumphs, even though checkered by failure, than to take rank with those poor spirits who neither enjoy much nor suffer much, because they live in the gray twilight that knows neither victory nor defeat.”
Few travel the road of risk and reward that we do as leaders, but along with victory comes defeat.
I dreamt of growing our company into a radio network of stations all across the country. I had a vision where I saw a network of stations dotting a map of America and believed I could do it. I first tried to do a merger with another company that already had a network of 20 stations. I was Chairman of the board and interim CEO of that organization and when we considered the 2 proposals for a merger (mine being one) I was the deciding influence on the board to vote for the other proposal! It was the right thing to do based on the facts, but it was a disappointment.
Then I bought 3 stations outside of Tucson and set up a satellite network to run them remotely and efficiently with one person on the ground in each city. I had a plan and strategy that I believed would be successful and lead to further growth of our network. I poured time and money into my vision and it steadily drained my time and our resources. In the meantime the stations became less valuable than what I paid for them. So I was loath to lose the vision and the money we had invested.
Finally, one of my board members asked me how much money we were losing a month on “the network” and what the loss would be if we sold the stations. We were losing $10,000 a month and we would lose $200,000 in selling the stations.
He said I had already lost the initial investment and would continue to lose $10,000 a month, (or more), plus the loss of time and energy if we continued to “hold ‘em”. I had to accept defeat (which was hard) and sold the stations. This was a blow, but in hindsight, it freed me up to focus on building our stations in Tucson. Our stations in Tucson flourished financially and our influence increased in our community. So what I saw at the time as an ultimate failure and defeat turned out to actually be a massive win for our organization!
Knowing when to hold ‘em, when to fold ‘em, when to walk away and when to run is key to success in business and in life. I hope that my story of defeat will help you to do the hard analysis in your organization and make the tough decisions that will turn defeat into victory.
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