How do you leverage risk for innovation?

Risk management is a dynamic and proactive process that helps individuals, organizations, and projects navigate uncertainties and optimize outcomes. By systematically identifying, assessing, and responding to risks and opportunities, you can make more informed decisions and increase the likelihood of achieving your goals while minimizing potential setbacks. However, sometimes we have to take risk based on our gut feelings. The decision which may not be backed by logical reasoning but more so it would be based on our intuitive feelings. Intuitive decisions are often more rewarding as it is considered more out of the box and has the potential to stand out.

Risk is about uncertainty of outcomes. It can be retained, avoided, mitigated or transfered through a simple five steps process.

Risk management is very important in all the professional fields. It is to look into all the risks involved before starting proceeding that can hurt or damage working plan due to uncertainties. Looking into risks involved is a proactive approach to avoid losses during working plan. By discussing and considering it before starting plan can minimise the damage losses.

Risk Management Practitioners should be seen as enablers to Business Units, to assist them in risk mitigation strategies, in the pursuit of strategic goals and objectives. At the same time Risk Practitioners must take the time to understand the Business Unit to come up with realistic risk mitigation strategies. Let’s move away from too much of theories, as we are in the real world and let’s deal with what’s happening in the real world right now and be practical about it.

Risk Management is nothing more than being "brave" enough to try something no matter if the outcome is failure.... More often than not, during the process of trying, one finds a way(s) to actually succeed! Therefore, be brave and venture out and try - nothing ventured, nothing gained! You'll be surprised at what you can accomplish.

Entrepreneurship - Risk & Innovation go hand in hand, one exists because of the other. The people & organisations that have disrupted most things in the world have pioneered one of these 3 elements. Without risk one would never be able to question the already established and consider thinking of solutions/ opportunities beyond the current options. Someone has to challenge the status quo and challenging the status quo is a risky proposition which could lead to failures or unimaginable results/ solutions. World's advance in science and technology, in medicine, in business & in all forms of growth is a result of humans risk taking abilities that led to phenomenal innovations over centuries.

Without risks and more importantly, the management of the potential risks to an acceptable level of certainty, we will unlikely progress over time. Risks constantly make us assess what could go wrong and also, what could go RIGHT. With this in mind, great minds in the world of medicine, technology, aviation, education, science, math etc have ventured into the less travelled road to make our lives a more liveable and enriching one!

Risk is an unteachable entrepreneurial skill drawing on natural instincts within an individual drawn to creative greatness and is key to the success of the entreprenologist. This is the mindset that is "opportunity seeking" rather than problem solving ...the latter unfolding as a consequence of innovation and being one of the "crazy ones" as Steve Jobs once quoted! The stimulation of business in today's fractured economic climate will come from those risktakers who defy the past traditional business structures that fear change. Entreprenology combines Knowledge Experience and Imagination and award credentials to the crazy ones!

While innovation is undoubtedly necessary, unchecked or unrestrained expansion or creation can be hazardous to the product, system or beneficiaries at large. A well thought out and methodical risk assessment, with key risks identified, mitigating controls and residual risks identification are as necessary as the innovation itself.

Risks do not exist in a vacuum. In more cases than not, risk is bundled together with opportunities. So, when risk is effectively managed, it can serve as the springboard to innovation because the path from opportunity to success becomes much clearer. Innovation therefore thrives when there is a balanced approach to the management of risks. This is why frameworks such as risk reward, SWOT etc are invaluable.

To effectively assess risk, involves not only quantitative analysis but also qualitative insights, intuition and market intelligence. It's important to keep in mind that innovation often thrives in ambiguity and sometimes the biggest risks lead to the most significant breakthroughs. Acknowledging the biases and assumptions that might cloud your risk assessment is crucial. Lastly, adaptability is key. The landscape of innovation is ever-evolving, so regularly revisiting and adjusting your risk assessment as new information emerges is essential. Flexibility and a willingness to pivot when necessary can be the difference between managing risk and succumbing to it in the dynamic world of innovation.

Looking at risk as a natural instinct gives us insights on using assumptions and preferences in the analysis of any given situation that we venture into when taking risks. Maybe it is the blend of conscious and unconscious influences on both material and ethereal consequences that alters the possibilities encountered. Using risk tools and matrices goes so far, and aid the risktaker for sure. When results unfold in ways that are largely unexpected and not fully calculated, we find whatever is created can become normalized. Before Steve Jobs we never imagined Apple computers..now the uncalculated normal way to use technology. Be careful not to assess risk too predictably!

In my experience, you leverage risk for innovation most effectively when you compare the costs of risks with the profit if risks do not materialize and your innovation is successful. If the cost of innovation is $10K and this innovation could potentially save your company $100K in expenses or earn an additional $100K in revenue - then it is safe to assume that a $10K investment in innovation is worth the risk. If you have to invest $10K to save or earn $10K with the innovation - then innovation is just not worth the risk.

You can use SWOT to analyze the internal and external factors that might pose threats or opportunities for your project,Focus on areas of strategic importance. ... Practise purposeful abandonment, Foster learning,Don't rely on your customers, Constantly communicate and connect and Choose the right metrics.

Any innovation comes with a risk and Either you will earn and learn. All the greatest innovations in the globe came with highest risk only

Innovation needs the spark of taking risks..."creativity is logic in hindsight" said Edward De Bono master of lateral thinking. Innovation is taking a risk on an existing element, product or service and shining an unusual light that reveals an enhanced new idea. If we stay in the safety lane, we never take the risk to test something new, we will remain fixed on what has been. Risk sparks innovative thinking and the entreprenologist makes something amazingly spectacular from that which is nothing special ??

When we think about risk, as our professional background we are conservatives and try to avoid situations that may come first as a challenge but can add value to the company. One key aspect here is to show the positive risks: the possibilities and opportunities. I agree that the strategy could come as a small start but that means the Board and Executives understand that every enterprise must develop their business otherwise they get stuck in the past and die: Evolution!

First of all one needs to choose strategy that aligns with the objectives, resources, and risk appetite. You can use the four basic risk response models of avoiding,reducing transferring and accepting.

We should think of innovation risk as a dynamic force that should be harnessed rather than eliminated. Instead of focusing solely on minimizing risk, consider a strategy that encourages calculated risk-taking to drive innovation. In this approach, risk becomes a valuable resource, much like fuel for a rocket.

Learning from risk for innovation is like navigating uncharted territories. Each risk is an experiment, whether it succeeds or fails, providing invaluable data to fuel your journey toward innovation. It is a dynamic learning ecosystem where failures are not seen as setbacks but as stepping stones to the next breakthrough. Embrace risk as a vital part of your innovation journey. Watching your organization thrive in this ever-evolving laboratory of ideas and collaborating with your team is so rewarding.

Embracing risk management techniques has the potential to enhance the outcomes of innovation projects. Nevertheless, the overutilization or the application of inappropriate techniques can cause creativity to go down. To strike an optimal balance, it is advisable to initiate innovation projects with qualitative risk management methods and progressively transition towards more quantitative approaches as the project mature.

I learned from Greg Moyer how to be an original thinker. Greg has 9 inventions and 10 innovations. Greg's Framework of Inventive Thinking states that there are 6 characteristics of inventive geniuses: 1) Open Mindedness 2) Pragmatic Opitmism 3) Growth Mindset 4) Think Differently 5) Open to Risks 6) Definiteness of Purpose