Risk management – how to make it a success story?
In a world of rapid change where innovation is the new black, organisations should find their ways to make business and stay competitive. Sometimes, innovations and new technology adoption sounds like a huge and complex exercise, especially when we talk about small and medium size enterprises. To investigate, what the key drivers of modern and successful organisations are, we have recently visited Silicon Valley and several leading Nordic companies. We will share some of the best principles, which proved to be successful for them. Note – principles, not practices. You will soon find out why.
Disruption is the new norm. Inevitably, technology and information are bringing disruption. In fact, there are virtually no sectors that are undisrupted. Think wearables, drones, self-driving cars, IoT, virtual reality, social media – all of these have brought significant changes in our lives, let alone businesses. There is nothing new here – the ground-breaking innovation always happen when distinct fields cross. However, the extent and speed of these collisions, enabled by technology and innovation, is now enormous. Thus, it is important to notice disruptive trends, even if they are from a different sector of your own, and try to apply them in your day-to-day work –they maybe will change your business significantly. One of the examples is Fintech. A few years ago no one could have imagined that insurance analytics would be automated or that customer acquisition would be done by AI. However, as people are increasingly trusting and developing technology, this is happening. Moreover, not only at Fintech companies, but all over the financial sector, as banks and other companies embrace the technology and become innovation engines themselves.
Forecast the future, do not try to predict it. When thinking about new methods of working or making processes more effective, it used to be a no-brainer to explore how other organizations work and act based on their best practices. It is tempting to just copy-paste solutions from other companies or make decisions based on historical data as you know perfectly what works or not. But the reality is that it is no longer possible to predict the future, and the disruption can happen anywhere, anytime. Moreover, indefinite research is very expensive, consuming the most precious asset we have – time. Thus the best advice would be to sense the signal of the trend, reflect and then act on it. This is why modern successful organisations are working on best principles, but not best practices.
Scale and speed. Another thing that many leading innovative companies have in common is resistance to failure. They are open to trial. They research and prototype. If successful – they scale fast. If not – they move fast on to another idea. Now virtually every company has initiatives for innovation. Yet too many companies forget that they can start small, with the ambition to scale, instead of spending time and resources and long planning and preparation. We have built prototypes in some projects, trying to solve one problem at a (very-limited) time and bringing employees from various backgrounds to build working solution. So far, it proved to be successful as you concentrate on how things can be done the most effectively during the process and disregard the ways of how things already work.
Expand and use your networks. One more important feature, that supports organisations while dealing with disruption and technology adoption, is to utilise the networks and worldwide communities. The key principle here is that you engage with people and other organisations, solve the problems together as organisations and do not operate in silos anymore. They work together and help each other to reach more and faster.
Start small and evolve fast, or move fast to another idea!