Industryweek 2894 Riskpromo

Innovation = Creativity x Risk-Taking

Sept. 24, 2012
An effective innovation leader should encourage creativity and risk-taking, while also practicing a tolerance for failure.
Innovation is impossible to achieve without taking a necessary amount of risk. In a world where the success rate of new product entries in the grocery business is one in 100, it's inevitable that every success sees failures along the way. An effective innovation leader should encourage creativity and risk-taking, while also practicing a tolerance for failure. In order to foster initiative and innovation, ask yourself these questions:
  • Do you allow free R&D time?
  • Do you invest in innovation -- money, people and resources?
  • Do you celebrate failure and risk-taking?

In a tough economy, the willingness to take risks can wither, so it's critical to let team members know that failure will not result in punitive measures.

A strong leader practices failure management by setting and agreeing on the risk-taking bandwidth or budget. It's OK to fail, but that failure should be seen and recognized as a learning experience.

Fear of failure is an innovation killer, so here are some simple steps to develop a failure-management plan that will lead to a culture of sustainable innovation:

  1. Clearly communicate the risk profile you are asking your people to adopt and state why it is important to the organization's success. This limits your potential loss, while opening up the floor for creativity and risk-taking.
  2. Never allow an unsuccessful risk to hamper a team member's opportunities and advancement. A culture of innovation depends on trust.
  3. Create and communicate the results of an award program created with a high intra-organizational profile. It should, ideally, reward risks that pay off and "gee, nice try's" that don't.
  4. Establish a formalized, non-accusatory process for harvesting key learnings from unsuccessful risks. Distribute these lessons learned. The key here is that all risks -- whether successful or not -- contribute toward the end goal.
  5. Give your people the situational risk-assessment tools they need to help them improve their risk taking decisions. This can include risk-scoring systems to identify different levels of risk, and ways to deal with adverse situations as part of a preventive strategy.

Robert Brands is the founder and president of Brands & Co. LLC, and the author of "Robert's Rules of Innovation: A 10-Step Program for Corporate Survival." As a former executive at Rexam Plastics and other firms, Brands gained hands-on experience in bringing innovation to market, creating and improving the necessary product-development processes and culture, and delivering "at least one new product per year to market."

Popular Sponsored Recommendations

The Executive Guide to Best Practices for Ecommerce Integration

Oct. 2, 2023
Get ready to elevate your post-checkout experiences and thrive in today's unpredictable market. Learn why integration and automation are crucial to run operations more smoothly...

Are You Positioned To Tackle Supply Chain Risk?

Sept. 20, 2023
Supply chain disruption is here to stay, but you can keep ahead of potential issues — and identify new opportunities — by regularly assessing your suppliers. Download our supplier...

7 Crucial Steps to Improve Your OT Security

Oct. 23, 2023
Enhance OT security in manufacturing and production. Uncover the crucial steps to safeguard your operational technology. Protect against evolving threats and bridge the IT-OT ...

3D Printing a More Efficient Factory Floor

Nov. 16, 2023
Today’s additive manufacturing platforms make it simple to print a wide range of high-performing industrial parts as soon as possible and right where you need them — unlocking...

Voice your opinion!

To join the conversation, and become an exclusive member of IndustryWeek, create an account today!