How can you identify and manage innovation risks in your product portfolio?

Innovate, Mitigate, Succeed! ????? I'd recognize innovation risks as potential downsides in pursuing new ideas. Identifying these risks involves understanding market dynamics, technological feasibility, and customer acceptance. Prioritizing them based on impact and likelihood guides focus and resources. Mitigation strategies might include iterative development, customer feedback loops, and flexible planning. Continuous monitoring ensures early detection and response to evolving risks. As highlighted in "The Lean Startup" by Eric Ries, embracing a mindset of learning and adaptation minimizes risk while maximizing innovation potential.

Innovation risks occur when the initial homework of the client base is not explored. There are a few precursors to success: Know the client’s needs, the client’s budget, and will the innovation fit the end users capability and band width.

Based on my experience, it's very tricky to guard against or prevent risks you're unaware of. The key approach involves extensive research—leave no stone unturned. Delve into every aspect, utilize tools and data gathered from user feedback, market research, and even insights from competitors. This intentional effort would give you clarity on potential risks, if not all, that may arise throughout the innovation stages.

One of the main items I look at is how far away the new product or technology is away from the the company’s current product line and business - each “adjacency” increases the level of risk exponentially. This simple method can help you quickly assess the level of risk in projects and the cumulative effect of the various decisions you make along the product development journey.

There are different risks of innovation when the context is not delved into: geographical, social, purchasing power of the customer, market segment, religious, market maturity, and age of the person, launch price and the years of consolidation of the company. , as well as the costs and budgets assigned to the prototypes and launches of the product that generates a new innovation, and the same risk of putting teams within the organization that do not have a balance between experience, knowledge and age, as well as communication that does not manage to be assertive and focused, in the clear evolution of the project collaborators who drive all the organizational work to achieve these innovation projects

When big money managers get recruited and promoted to lead the umbrella company into the new tech future, things that worked get left by the wayside. If the umbrella company owns several smaller legacy companies, they cannot be left on their own to prosper into the future without attention by the “mothership”. Once a new product in the fold is targeted that is not part of the legacy products and it consumes engineering, finance, sales and production, the results can be catastrophic for all the sub companies. Once the main leadership leverages new products while leaving the others to struggle, the legacy products lose market share and direction from what they once were. Smart investment demands multiple income streams, even in business.

Calculate the risk exposure of each item by multiplying the risk impact by the relative probability of this risk happening. Whichever risk has the highest “risk exposure” is the one you need to focus on to mitigate through prevention or recovery plan.

These can be reduced and possibly mitigated based on good communication and experience, as well as having a good approach and a planned plan, being flexible and adaptable to events that arise, as well as being creative in resolving situations that involve to good results, but this has to be understood and applied by all the people involved and recognize that innovation can entail risks but with good pressure on them and the support of the team and leaders within the organization the success can be achieved. scope required in this type of projects

A part of innovation is the prototypes and tests created for the product, as well as surveys and market tests that the innovation product or service has been executed to gather information that helps make good launches, much of this work must be seen as an important part of recognizing that customers are ready to receive it or even showing that a customer requirement was discovered long before the customer themselves requested it.