Managing Risk

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There were folks across the country that breathed a sigh of relief in seeing the Shuttle Discovery successfully launch. There are those that believe that the billions of dollars spent on the space program is just a huge waste of money. I couldn’t disagree more. As with this latest launch, setting goals that are virtually impossible to attain are what drives us to innovation and progress. The space program is one of those programs that does just that. The enormous burden is the management and evaluation of risk.

Pharmaceutical companies have to do it. They manage risking people’s lives in order to save people’s lives. (Great episode on Law & Order last night) Automotive dealers do it. Cadillac risked everything by radically redesigning their entire suite of models. Imagine if the design was not well-received?! Gillette and the Mach3 razor. Sharp and LCD Televisions.

Of course, these are the successes. There’s also the failures!

I believe the answer on success or failure does not depend on whether there is a risk or not. If there is no risk, you will most likely be devoured by those people that WILL take the risk. The ability of your organization to measure and analyze risk as well as its willingness to take the risk is the key to its success.

What do you think?

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