What role does luck play in the success of a business? Do we make our own luck through hard work or is it down to just ‘good luck’?
These were some of the questions being asked by Hiscox, in partnership with Royal Institution, at an annual debate to explore the theme of luck versus hard work when it comes to business success, a subject designed to provoke debate amongst the SME and entrepreneurial community.
The event was moderated by radio broadcaster and SME journalist Liz Barclay, and the panel consisted of academics Dr. Stephann Makri, Dr Matthew Smith and Douglas Miller and successful online fashion retail entrepreneur, Sarah Curran.
Luck can be interpreted in many ways and Dr Stephann Makri, who has spent several years researching a phenomenon called ‘serendipity’, believes it is a type of luck that we can influence. Dr Matthew Smith, who has a PhD on the psychology and parapsychology of luck, highlighted how psychologists have traditionally assumed that luck is an unstable and uncontrollable force outside of our control, while the CEO of online fashion retailer my-wardrobe.com, Sarah Curran, argued that having a ‘lucky’ career is about seizing opportunities and therefore proposed that success is down to both luck and hard work. Author and trainer Douglas Miller, meanwhile, explored the idea that proactive thinking can effectively help create luck.
However, Liz Barclay summarised: “In my experience, to be a successful entrepreneur you need more than just hard work or luck. You need the vision to spot a good opportunity or a great idea and the determination to do what it takes to succeed. You need a sensible business plan, you have to stay focused and you need the drive to achieve your goals but you also need to know when a venture is just too risky and to be brave enough to walk away.”
New research released by Hiscox has also analysed the underlying factors to running a successful business and investigated whether entrepreneurs felt their success was down to luck or hard work.
From the 502 entrepreneurs surveyed, 15% attributed their business success to luck or a lucky break. Most entrepreneurs defined luck as being in the right place at the right time, making contact with the right people or having an idea that happens to be appropriate at the time.
Hard work was more commonly defined as being the result of the actions people take, therefore making favourable situations and outcomes more likely. The majority of respondents agreed their own hard work and perseverance had played the biggest part in their business success.
When it comes to business success, though, hard work and luck were not the only significant factors identified. It seems that entrepreneurs believe you also need the ability to take a risk, as 72% of small business owners surveyed said they don’t believe it is possible to have a successful business without taking risks.
Alan Thomas, Small Business expert at Hiscox, commented on the findings: “From seasoned entrepreneurs to newly created start ups, small business owners understand that there are both risks and rewards to setting up and running their own business. Our research highlights that 39% of budding entrepreneurs wanted to start a business for a while before they eventually did so, but held back due to the risks associated. As they continue to plan their route to success, we encourage them to think about how risk assessment and good judgement can contribute towards success.”
Dr Stephann Makri added: “Serendipity involves taking actions to turn unexpected circumstances into a valuable outcome and my research has shown that this is an important factor in peoples’ work and everyday lives. Although only 15% of respondents cited luck as an important factor contributing to the success of their business, these might be the entrepreneurs who took the necessary risks to turn lucky circumstances into a successful business.”