Innovation is Creativity x Risk Taking
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 1 in 100, it is 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 research and development (R&D) time?
- Do you invest in innovation: money, people, 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 is 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.
- 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.
- Never allow an unsuccessful risk to hamper a team member’s opportunities and advancement. A culture of innovation depends on trust.
- Create and communicate the results of an award program created with a high intraorganizational profile. It should, ideally, reward risks that pay off and “gee, nice try’s” that don’t.
- 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 towards the end goal.
- 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.
For more tips on achieving innovation through risk taking and failure management, see “Robert’s Rules of Innovation: A 10-Step Guide for Corporate Survival.”
Tags: Creativity, Innovation, Risk Taking