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For the CEO

A message from our editor on this critical topic.

What’s at Stake

In periods of heightened uncertainty and disruption, CEOs might tend to avoid risk. But being too cautious comes with its own hazards. It can lead companies to miss out on opportunities to expand market share, enhance the brand, or drive innovation as consequences compound. CEOs must evolve from worrying excessively about possible setbacks to considering the genuine peril of inaction. Risk is a two-sided coin. It is also a major source of advantage.

What the Numbers Say

50%
the share of CEOs who have regretted not moving swiftly enough when setting goals
4/5
of US investors support companies investing in innovation and go-to-market strategies—even if the moves affect margins in the short term
5 p.p.
the increased success rate for transformations shaped by looking outside the business

BCG research underscores this point vividly. A BCG study assessing the tenures of 7,000 CEOs worldwide found that those who initiated transformations within the first two years delivered higher total shareholder returns than those who started later. A separate survey of 70 former CEOs and senior executives found that more than half cited moving too slowly among their biggest regrets.

The inclination to delay, often perceived as prudent, was later recognized as costly. To succeed, CEOs need to balance operational caution with strategic boldness. This dual mindset—part operator, part visionary investor—is essential in transforming short-term uncertainties into long-term strategic advantages.

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Betting Bold

By embracing calculated risks, leveraging external insights, and continuously challenging ingrained biases, CEOs can seize critical opportunities today. They can secure their organization’s competitive future by building an uncertainty advantage in volatile times.Here’s how:

Quantify Upside and the Cost of Inaction. In volatile environments, caution doesn’t guarantee safety. It belies hidden exposure. Deciding not to move is an implicit bet with often significant, invisible costs. But companies often focus more on the downside—rather than the potential upside—of market disruptions. Some 80% of senior leaders surveyed by BCG in 2024 said they viewed risk in a mainly negative or neutral light. The result? Many CEOs may be missing out on opportunities that come with being a first mover or early adopter.

The strongest CEOs demand equal attention to bold “what-if” possibilities. They ask questions such as “What if our strategy delivers better-than-expected results?” and “If this works spectacularly and we had hesitated, what actions would we regret not taking now?”

Balance the Operator and Investor Hats. Operational excellence can’t sustain value on its own. CEOs must actively build future-ready businesses by making bold capital allocation decisions, strategic investments, and shaping compelling long-term growth narratives. Nevertheless, research in 2023 revealed that caution, rather than bold action, is becoming the norm. Analysis from BCG’s capital allocation database—covering over 10,000 listed firms—showed a 10% decline in capex relative to revenues over the past decade. This conservatism comes despite more than 70% of US and European investors (and 80% among US investors exclusively) supporting companies making investments in innovation and market strategies, even at the expense of short-term margins.

How can CEOs effectively balance their operational duties with a forward-looking, investor-oriented view? A critical step is dedicating deliberate, uninterrupted time for big-picture reflection. These periods should come with no interruptions, no slides. Just expansive, future-focused questions like “What bold moves would my successor immediately make?” Such conversations rarely happen without intentional space. It’s equally important for CEOs to communicate openly with their executive teams about balancing immediate operations with long-term strategy—reinforcing the need to look ahead, not just around.

Get Out of the Echo Chamber. CEOs can build conviction for bold moves by intentionally tapping into diverse viewpoints, both within their teams and across broader professional networks.

Internally, leaders should actively seek candid insights from frontline employees—retail teams, operational heads, and junior engineers. They can also draw insight from internal skeptics, individuals whose incentives aren't aligned with moving ahead with new initiatives. Soliciting challenging critiques from these employees is critical for pressure testing ideas. They might also ask themselves, “What would Apple do? Or Unilever? Or an organization without fear or constraints?” That train of thought can help CEOs draw inspiration from other models of success.

Executives shouldn’t hesitate to look beyond their organizations. They can engage with peers in noncompetitive industries, analog sectors, and markets further along the innovation curve. Connecting with savvy investors on risk tolerance and capital allocation priorities can be a further way of testing assumptions. Viewing new opportunities and initiatives through an external lens can be a game changer. BCG research reveals that companies that consistently look beyond their immediate environments—examining industry trends, geopolitical factors, macroeconomic shifts, and sustainability developments—achieve a 5 percentage-point higher success rate in growth transformations compared to inward-looking firms.

Check Bias, Blind Spots, and Boldness. Self-awareness is one of a CEO’s most powerful tools—but it requires intentional effort. Leaders must routinely audit their decision-making processes for biases and blind spots. A valuable starting point is asking tough questions like “Am I dismissing this idea simply because it hasn't been done before?” Often, what appears as necessary caution is actually fear, or inertia in disguise. Being bold begins with recognizing and confronting what's genuinely holding a decision back.

At the same time, while CEOs must trust their intuition, they need to cross-check their views. They shouldn’t bet big without inviting constructive dissent. The bigger the vision, the more critical it is to seek out—and thoughtfully consider—alternative viewpoints. Boards can be especially effective in reducing biases. Research published in the Academy of Management in 2024 suggests that the board plays an effective role in company decision making when it “reduces the overall influence of cognitive, personal, and group biases on a given decision.”

CEOs can cultivate a culture of strategic risk taking by testing and refining bold ideas through learning loops and pilot programs. Establishing smart partnerships can further strengthen new ideas, enhancing value propositions while managing risk effectively.

A Parting Thought

Ensuring a smart, balanced approach to risk doesn't end at the C-suite. CEOs must actively nurture an organizational culture that views risk not just as something to control but also as a key driver of growth. Build an environment in which teams consistently challenge assumptions, experiment with new ideas, and openly explore areas ripe for innovation.

To achieve this, clearly articulate the importance of taking calculated risks, reinforcing that experimentation and initiative are not just tolerated but expected and rewarded. Leadership must visibly support this mindset by recognizing effort and innovation as much as successful outcomes and offering resources and training that empower employees to explore confidently. Embedding this proactive approach into daily operations transforms traditional risk management into a strategic advantage. Organizations that actively cultivate a culture of curiosity and courage are better equipped to seize the day.