Risk & reward

Just a quick redirect to an article by Kevin Kelly (not the guy from Long Now, Wired, etc) in Forbes about risk and innovation, which has been a topic I have spent a lot of time on this week. Apart from the references to our old friend Daniel Kahneman  (see 18 previous posts) Kelly makes some valid but perhaps a bit general points on the balance between risk and innovation – one bank executive’s innovation is another civil engineers risk, as I might have said to Rod earlier this week.

Kelly says “Everyone is taking, if anything, too little risk.” well yes, but lets explore that…while the points he makes about framing and emotion reflect Tversky and Kahneman, its still a stretch in the current economic situation to feel that corporate risk taking will save the day. Or maybe I misread it – if so I blame the last glass of red wine. I did, however, like this bit:

“How can you as a leader instill a culture that makes your employees wisely embrace risk and figure out new ways to build revenues? Here are three suggestions: (1) Ensure employees see unanimity across the senior team about the firm’s priorities; (2) encourage mistakes. “If you fail, try again. Fail again. Fail better,” said the playwright Samuel Beckett (we can learn a lot from the creative process); (3) make collaboration desirable. Complex problems require collaborative solutions. Where leaders fail to persuade their people to collaborate, ambiguity and competitiveness rush to fill the vacuum.”

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