The recent report on innovation and risk shows that ERM executives believe ERM is a missing piece of the innovation process. Some of the keys are:
- Incorporating ERM into the innovation process
- Requiring risk acumen
- Risk-adjusting the analysis, and
- Doing risk post-mortems.
These keys are designed to counter the risk of bias by various members, force the risk conversation at every stage (rather than after the new innovation is launched), identify and understand all risks with the innovation (not just the financial related risk), get consistent performance, and change the thinking from a certain number to the real value associated with the innovation. One CFO even argued that financial numbers are the last thing to consider.
The real success? "If you know the real risks, you can innovate more," according to one Fortune 50 company executive.