High Levels of Optimism Ensure That Future Business Events Will Turn Positive?

If you have ever come across a test for the level of confidence and optimism it would most probably be the Life Orientation Test (LOT). LOT is the most common way of measuring dispositional or trait optimism by asking about people’s generalized expectancies. But why does measuring optimism so important to many of us as entrepreneurs and business owners? It turned out that our drive to achieve is directly related to us being overconfident thus having a high level of optimism. Studies have shown that entrepreneurs are more optimistic than the average people. The effect of optimism is significant in all stages of the entrepreneurial journey. Optimism enables entrepreneurs to find creative solutions to ambiguous problems, decide on whether to launch a venture or not, plan and implement decisions, and constantly create processes toward finding innovative solutions.

The best way to assess your level of optimism is to let others assess how they see you rather than a self-assessment test. They need to answer to what degree you are able to expect the most favorable outcome in any situation. The better you are the greater your ability to succeed as an entrepreneur. Some people are more optimistic than others by nature, however, the good thing about optimism is that it can be learned.

Martin Seligman, the author of Learned Optimism highlights five steps for learning to be more optimistic:

1. The first step consists of learning to identify situations and events that we encounter on a regular basis and think of challenges that we see in those situations;
2. Once we think of challenges we start writing our expectations and beliefs about the outcomes of those situations;
3. The third step consists of thinking about different consequences and the levels of emotions and energy for what would be happening and what we did about it;
4. The fourth step is to think about possible disputable elements, what other things can happen, what we may have missed or not considered, what factors can influence the situation, what implications each factor has, and what evidence we have that should be documented;
5. The last step is to think about the level of influence of energy and beliefs we had over time. We consider each element and how it affected our emotions and feelings seeing them as optimistic or pessimistic and whether it affected our decision.

Seligman’s five-step approach is a systematic way to establish and develop optimism over time. It also helps us better understand the root causes of pessimism thus its effect on decision-making when it comes to entrepreneurial ventures.