By: Sophie Goldberg
In a world constantly accelerating towards technology and connectivity, it seems as though innovation has never been more important. In many ways, this is true; companies today are increasingly obsessed with engineering vehicles that will propel them forward. But equally as important as creating a gas pedal to fuel those vehicles, is having a brake system to manage their speed. This is where risk management comes in. If innovation is the gas pedal of your organization’s vehicle, risk management is the brake system that helps the company proceed safely. And much like the gas and brake systems in cars, not only can risk management and innovation work together, they should. The key to any organization’s success is marrying the fearlessness of startups — their wild ideas, innovative products, and groundbreaking technologies — and the structure of large organizations — their organized metrics, established financials, and secure safety nets. Connecting these concepts is like gradually accelerating the car with an eye toward oncoming hazards; when used harmoniously, both systems help the whole vehicle travel safely toward its destination.
There are many routes that can foster innovation while encouraging strategic risk management. To maintain a sustainable innovation / risk management balance, Financial Management Magazine specifies five actions:
- Set risk culture at the top: One of the most basic tenets of success in any organization is a clear set of priorities. Leaders need to ensure that everyone invested in their organization understands risk and how to manage it.
- Involve risk management in an entire innovation cycle: All too often, companies analyze risk before proceeding with a new idea, product, or system. Some consider risk management once again, when innovation is starting to come to fruition. Rarely do organizations keep risk management practices in their back pocket at all times, ready to merge innovation and risk management whenever necessary.
- Adjust risk appetite: Companies that are unwilling to constantly reevaluate their risk management processes might as well stop taking risks at all. It’s imperative to approach risk-taking as a living and breathing concept.
- Develop new competencies: To ensure that enough innovation occurs in any organization, learning and perfecting new skills is crucial. Whether it be in technology, communication, PR, or anything in between, new skills lead to new innovations.
- Monitor risk management effectiveness: At Spyre Group, monitoring risk management effectiveness in two-fold. First, it means that organizations must often analyze how they are exploring risk management in their company. Are they utilizing both qualitative and quantitative methods? Are they drawing on a number of sources to understand the risks they take? Second, it requires that companies present their risk management analyses in an accessible way. Ensuring that both organization investors and consumers understand the risk management analyses likewise ensures that the company can continue innovating with the support and stability necessary to foster success.
inding a comprehensive and personalized balance between innovation and risk management is necessary to ensure that an organization’s long term success. But even with a perfectly engineered gas pedal and brake system, a vehicle will not travel safely without a steering wheel. This is exactly where Spyre Group comes in. Our unique model focuses on personalized innovative processes that make sure your company applies the correct pressure on a gas pedal, as well as a safe push of the brake. We can guide your organization exactly where it needs to go without changing the fundamentals of the group. We will give you the tools you need to maximize innovation, minimize risk, and analyze your organization at any moment.
Ready to discover the best vehicle for your organization’s future? All you need to do is get in.