I love risk

I often meet managers seeing risk as a threat: a threat to predictability. They rightfully aim to be a trustworthy partner for their customers and believe predictability is an important ingredient for that. But they sometimes forget risk is one of the reasons why they’re in business. There’s intrinsic uncertainty in innovation, and many of our customers in a B2B environment seek partners who can better manage that uncertainty than they can do themselves – and they’re willing to pay that: the higher the perceived risk of your own investment, the more profit a customer will allow you to take.

So, managing risk is a key element of the value we add towards our customers, and it would be silly to try to avoid it. Many managers spend substantial effort identifying risks in advance and defining mitigation actions. They focus on the known unknowns and even apply sophisticated methods like Monte-Carlo simulation. But most innovation projects suffer from unknown unknowns. And this makes these techniques totally useless. You better organize yourself to deal with the unexpected rather than trying to predict the unpredictable.