How risk and innovation can be better partners
Ruth Murray-Webster and Eleanor Winton look at how risk and innovation can work together for business success.
That risk and innovation often struggle to work together or even engage with each other is one of the greatest missed opportunities in business. It’s a perfect example of where the organisational designs we develop to maximise efficiency can lead to siloes which have the effect of hampering performance.
In a stable environment that’s a shame. In a disrupted one, the one we’re living in, it’s a disaster. Our need as leaders to categorise change in our operating environment as risk OR opportunity rather than potentially both means that we are narrowing the potential scope of action we can take before we’ve even had time to consider the issue and its implications.
We have a great deal of professional experience of risk and innovation functions effectively being set up to work in conflict with each other, only coming together at the end of the their respective processes to battle it out for leadership support.
This is an unsustainable and wasteful way to do things. Risk and innovation are two sides of the same coin and need to be able to work together from the outset if they’re to enable their organisation to address disruption.
Fostering a sense of common purpose
The changing context for business creates a compelling reason to bring these two together around a common objective. We are living in the moment that signals the beginning of the end of ‘profit at all costs’ and the transition to a more inclusive and value-led definition of the role of business.
How many really strong facilitators does your organisation have?
So the leadership conversation has changed - from generating returns, to generating value. Of course value generation is truly the function of both risk and innovation – making this explicit and aligning that to your overall game plan as a business will go a long way to aligning leaders in risk and innovation and encouraging collaboration and mutual respect between their teams.
Consider though: If a leadership team are not willing or able to clearly articulate what they are prepared to chance to pursue disruption, the chances of creating any lasting innovation and change is limited.
Common language and measures
Having established a common objective, risk and innovation must also have a common understanding (and some common measures) for what 'good' looks like.
A game plan for the journey ahead, owned by the whole leadership team, is an invaluable guide in the path to value because it enables disparate parts of your business to see their work in the context of something bigger than themselves. Not just a statement of purpose or strategy but a roadmap to future success.
To do their jobs well in a disrupted environment, both risk and innovation need to balance a range of ever-changing factors. In the absence of common objectives and common measures, the risk of a return to siloed thinking is high.
Designing the right interactions
How often do we set up a ‘workshop’ or ‘collaboration session’ between disparate teams (innovation and risk as just one example) and just expect that the magic will happen? It’s common, but rarely does the magic materialise of its own accord.
Where we expect teams to work together, we must provide the common objectives, discussed above, but we must also work to drive motivation around those objectives every time the teams come together.
The facilitator role is key to that – not just once at a ‘kick-off’ or ‘team building’ event but as a normal part of the way these teams engage on an ongoing basis. How many really strong facilitators does your organisation have? People with the ability to design great interactions, the knowledge to anchor the process and the confidence to provide challenge, to even a senior audience.
Few organisations acknowledge the value of the role in day to day operations, let alone factoring it into training budgets and programmes – a significant missed opportunity.
Partners for life
Looking ahead, our disrupted future presents us with an ever growing range of complex global challenges to which there are no simple or quick solutions. No individual person, team or organisation holds all of the answers so we must dig deep to find the will and the energy to collaborate at all levels and across all disciplines.
As leaders, we have a clear choice to make, to hope that what we have in our toolkit is enough or to take this opportunity to invest in the capabilities that will enable us to survive and thrive in a disrupted world. The prize is something that we see too infrequently – a truly sustainable path to stakeholder and shareholder survival.
About the authors
Ruth Murray-Webster and Eleanor Winton are experts in risk, disruption, innovation and foresight and co-authors of new book The Disruption Game Plan: New Rules for Connected Thinking on Innovation & Risk.
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