Embracing Risk to Grow and Innovate

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Treating a lack of money as a positive constraint helps strip away the fatty financial insulation that success builds up. Leaner budgets are less risky because they make it harder not to act.

6. Make a list of the best things that could happen

Ross Mayfield, CEO of Socialtext, is a Silicon Valley entrepreneur with an interesting approach to formulating strategy. “As a planning exercise, I always try to ask two questions: ‘How could we take more risk?’ and ‘What risk can we take that creates the greatest amount of options?’

As we saw earlier, with Markus Diebel’s 11-digit risk dial, people who employ Design thinking know that amplifying risk is a way to create more evidence of what works and what does not. When Ross Mayfield thinks of ways to take more risk, he’s actually reducing the long-term risk of his venture by uncovering the kinds of long-term business opportunities that are the lifeblood of a thriving organization. He creates real options, because this risk-embracing activity puts you in to the flow of opportunities he would not have known existed without thinking through risky scenarios.

7. Seek challenges

Organizations are but groups of people, and in our work at IDEO we see over and over a direct correlation between the Design thinking abilities of individuals and the innovation quotient of the organization they belong to. It is hard for an organization to be pushing itself to the edge of its capabilities and learning if its people are not adept at living with risk.

The ideal situation for someone trying to be innovative is one that balances clear, achievable goals with just enough task challenge so that there’s a real risk of failure—enough to light their fires of creativity. Design thinking is the methodology individuals can hang on to in order to navigate challenges and risk. As they do so, they learn and grow, and in their personal growth is the wellspring of creativity and innovation to feed larger innovation efforts.

Embrace Risk and Reap the Rewards

In business as in life, we all seek to reduce and manage risk, but we also need to grow and innovate. The best way to achieve both is to embrace risk while also mitigating it.

At a personal level, design thinking is a life skill that gives us the tools to recognize risk and act in ways that mitigate it so that our dreams—big and small—can come true. For organizations, this approach provides a consistent and proven way to structure challenging innovation initiatives so that they become less risky. We can’t all be designers, but we can use aspects of design thinking in our lives to embrace, amplify and mitigate risk in order to create lasting value for ourselves and our world.

Rodriguez leads IDEO’s Global Business Factors group and is based in Palo Alto. For more, read his influential blog about design thinking at www.metacool.typepad.com. Jacoby leads the Consumer Experience Design practice in IDEO’s New York City location. He also co-leads the firm’s Design for Business efforts, facilitating the integration of business issues into design thinking.