TACKLING INNOVATION RISKS

Innovation is a very powerful tool and a key driver of value, but all forward leaps come with some degree of risk. In light of this it is vital that organisations, irrespective of their size, champion innovation in order to move forward. Likewise, companies must be prepared and willing to accept failure in order to flourish.

However, in the current economic climate many businesses are fearful of the inherent risks of pursuing new ideas that may not ultimately succeed. Clearly, it is of paramount importance that companies strike the right balance between innovation and necessary risk.

There is a widely held belief that typically it is start ups that make the ideal staging ground for innovation, as they are generally free to pursue innovation uninhibited. The perception is that start up companies are more liberated, comprising of independent and self sufficient teams, able to develop products and ideas with minimal oversight.

If the assertion is correct and these smaller firms do indeed have significantly less to lose by pursuing innovation, the opposite is often thought for larger, more restrictive, structured organisations. However, when properly fused, the two disciplines of innovation and risk can help organisations of any size pursue profitable opportunities that more risk-averse companies might otherwise ignore. In this context, a suitable risk management program can help further a company’s innovation agenda.

Oct-Dec 2013 Issue

Richard Summerfield