Using ERM to Make Innovation More Successful

I recently attended the Lean Startup Summit in Berlin. A few ERM/startup takeaways:

First, use an ERM approach to identify the risks in the startup. Instead of COSO’s risk categories or strategic objectives, consider using the dimensions of usability, feasibility, and value. Use these prompts to get the team to identify and map the risks on impact and likelihood. Manage the big ones right away. The startup may depend on it.

Second, identify the critical success factors in the launch of the startup (at the Summit this was applied to a product launch). Using those factors, attempt to reduce the risk of each product launch factor via testing. As the tests prove successful, the risk is lowered. Document the test results and (hopefully) reduced risk.

Third, once the product or company is launched the next steps are focus, focus, focus. This was labeled horizon one and the focus seemed to be on selling that product/idea and getting it out. But according to research done by this company on scaling companies, a considerable amount of effort must be put into new products. Stated differently, they suggest that true long-term success must focus on the next product and time must be continuously allocated to the new ideas even while focusing on the current success.

Note we have a white paper on the ERM - innovation connection that has valuable additional content.