But knowing how the ship was built and by whom, having an experienced captain and a trustworthy weather report will dramatically change the nature of the risk you take when sailing into the wild blue yonder.
One school of thought around risk-taking is that risk is bold and without taking the risky option there’s no progress. Big risk equals big wins! Another school of thought is that being risk-averse is what prolongs life. Avoiding risk means stacking the odds in your favour and delivering better more predictable outcomes in the long run.
The world of innovation is increasingly adopting an approach to risk taking that encourages risk and believes risk is valuable. Innovation itself is generated by doing things in an exceptional uncommon way, by challenging the norm and developing new thinking, by being radical. So it’s not surprising that risk taking is promoted because risk feels like it’s part of this family of behaviours. The idea is that risk not only encourages radical thinking but is the outcome of radical thinking and in innovation radical thinking is good.
Because of this attitude many organisations actually encourage and incentivise risk taking. Failure, previously the unwanted consequence of risk, is now understood as a kind of success. Where there was once risk and failure there is now risk and success! Of course failure can be part of a learning process. Although it all depends on what kind of failure you experience and whether the failure generates genuine learning or merely loss. Learning is certainly not the outcome of all failure.
The problem here, in both schools of thought, is that they assume risk to be one sort of thing. A leap into the dark, the moment of uncontrolled uncertainty that can bring about unwanted consequences. Although the consequences of taking risk could have been planned for, they are still not the desired outcomes. Risk is seen as a kind of poker game where you don’t know the other players cards, but worse still, you’re never really sure of your own.
The root of this problem is a confusion between risk taking and risk management. Risk taking is a gamble and can deter innovation. Risk management is not a gamble and is an integral part of innovation. The difference lies not in the moment of taking the risk but all the moments leading up to it.
Risk management means conducting the innovation process professionally by minimising the unwanted consequences of risk before any risk is entered into. This isn’t as difficult as it sounds, and it’s a natural part of a proactive systematic approach to innovation.
The trick is not only to minimise risk at the late stages of innovation but to maximise success by how you create your solutions in the first place. Professionalising your innovation and being iterative and experimental in your approach means you don’t have to take a gamble. Real risk management maximises the possibility of success by creating the strongest possible insights, ideas, concepts and solutions from the beginning. By introducing procedures and behaviours that eliminate weak insights, ideas, concepts and solutions as precisely and quickly as possible you can lower your liability because your risk is always minimised when the quality of input is better.
In this way you genuinely are changing the nature of risk and failure because you’re taking small steps towards success by eliminating things that don’t work before introducing them into your organisation. And it means that dealing with risk becomes part of the innovation process rather than something you do at the end to test your innovation. The testing becomes an integral part of the innovation process.
That way not only will you get a better insight into the cards held by other players, you’ll be rightly more confident of your own hand too.
To gain further insights into how to build and strengthen your innovation process, get in touch and find out how we can help you. We’ve been pioneering the professionalisation of innovation since 2000 to become one of the worlds leading innovation consultancies. Amplify has developed and implemented unique innovation services that deliver immediate and long-term sustainable value, together with clients such as BMW, Siemens, Ericsson and AstraZeneca. Amplify also trains hundreds of new innovation managers on an annual basis, through their own programs and together with major international executive schools.
Professionalising innovation with Amplify means proactively embracing today and tomorrow.