That's Life: Laboratory Owner or Corporate Technician?
That's Life: Laboratory Owner or Corporate Technician?
I recently was told of an opening for a dental technician with Nobel Biocare. The job description called for someone with a strong background in dental implants, good communication skills and possibly presentation skills. It seemed to me, that anyone who fit that description already owned a lab. But with the current economic conditions, it occurred to me that a lot of lab owners might be better suited for this position than one of a lab owner.
Face it. Some of us think of ourselves as a Hank Aaron and some are a Ty Cobb. A Barry Bonds or a Hugh Duffy. We either consistently get on base or we go down swinging for the fences. Understanding your attitude towards risk and reward is essential for a happy life as a lab owner, or a corporate technician. Times like these may make you wonder.
Hank Aaron is the Major League Baseball career home-run leader, and Barry Bonds holds the single-season record. Ty Cobb has the highest career batting average, and Hugh Duffy holds the single-season record. Interestingly, for batting average, Hank Aaron isn't even in the top 100. Barry Bonds isn't in the top 100 for the single season. But Aaron and Bonds are both in the top 100 all-time for striking out. When you swing for the fences, you strike out more than when you just try to get consistently get on base.
So are you a slugger or a base hitter? What's your tolerance for risk vs. reward? Employees tend to be base hitters, and entrepreneurs tend to swing for the fences. That's not a hard and fast rule, of course.
The underlying question has to do with your tolerance for risk and desire for higher reward. For all the talk about the high salaries of corporate CEOs, the reality is that most millionaires are self-employed professionals or entrepreneurs. Yet most strike out a few times. As Barry Moltz says in his book, You Need to Be a Little Crazy, "It is not a question of whether you will fail as an entrepreneur, it is simply a question of when and how."
Consider the following scenario: We're going to flip a coin 100 times. I'll give you $100 for every heads, and if it's tails, you win nothing. You figure you've got nothing to lose and probably $5,000 or so to gain, right?
Let's say instead that you have to pay me $100 for every tails. Do you still do it? Maybe. 50-50 chance. Low risk, low reward.
Now, consider two versions: Version 1: Heads, you win $100; Tails, you lose nothing. Version 2: Heads, you win $300; Tails, you lose $100.
In version 1, you can expect to win about $5,000, give or take, and you've got no risk. In version 2, you can expect to win about $10,000 (500 x $30 = $15,000; 500 x $10 = $5,000; $15,000 - $5,000 = $10,000). But you could lose as much as $10,000 -- unlikely, but possible. There's a fairly good chance, though, that you might lose something.
How much risk are you willing to tolerate for the expected reward? Or, flip it around: How much reward does it take to justify the risk?There's no right answer. To make matters worse, it's not exactly like flipping a coin. What are the odds that your lab is going to be successful and survive this downturn? Things may get worse before they get better. Of course, you believe that you have something that makes your odds better than the average. Every successful entrepreneur has thought that. So have most of the ones who've failed.
If you swing for the fences, owning you own lab may be your best choice. If you prefer a consistent batting average, perhaps you should reconsider that job at Nobel Biocare. We are facing some real challenges in dental technology. I’m more afraid of digital impressions than I am of offshore competition, but the fact that I want to outsmart them, rather than run from them is the difference between a home run and safe single.
But there is no shame in bunting, and the big leagues are looking for some talented players right now.
