How to Make Risk Work for You

When I speak around the country, and I proclaim the most dangerous thing that a company can do is focus on risk, the response I get is shocking. There’s a warm, comfortable feel to risk management in corporations today, and that comfort is a manifestation of years of adding layers and layers of risk management – with the erroneous idea that managing risks – reduce risks!

Here is a list of “risk management” suggestions that I believe will help you achieve what you’re REALLY trying to achieve- which is a genuine connection with your customers, and organizational success:

  • Play the game to win, not to “not lose.” Winning companies focus on delivering net customer value; very little of their organizational bandwidth is consumed by risk management. They are “wired” to their customers.
  • Manage failure – don’t manage risk. Make sure the product fits the requirements that you’ve discovered through a high level of customer connectivity. That’s where innovation really lives.
  • Use risk management to verify that the product does that but do it quick – the market won’t wait.
  • Create an organizational philosophy – and organizational culture – of pride. As I walk through the beautiful brewery at Sierra Nevada, all I could think is “Wow – here’s somebody who’s extremely proud of their business.” Not a speck of dirt – it was hospital clean – but it had a way different feel to it than a hospital. It was warm and inviting. It was a great place to work for people who love what they’re doing.
  • Create an environment that fosters customer connection and pride. Cut the crap! Get rid of the organizational antibodies. We’ve all heard the nomenclature around innovation, the lexicon keepers must go. Or, at the very least, they must change their language. Let’s talk about customers. Let’s be real. Let’s forget the processes and systems that are just there to protect somebody’s job.
  • Check your focus. What does your organizational focus look like? Change your focus to playing the game to win, not just playing not to lose.
  • Remember that some failure is healthy for your organization. You learn from your mistakes, and you get some organizational pride for the attempt. Better to have loved and lost than to never have loved at all, right?
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