RISK AND INNOVATION

Risk and innovation

Risk and innovation

Introduction

The purpose of this study is to expand the boundaries of our knowledge by exploring some relevant and factual information relating to the analysis of “Risk and Innovation”.

High degree of risk is a characteristic feature of the innovation process. Frequently, it is necessary to establish the likelihood of the factors that may affect the implementation of innovative actions. Innovation is not simply the act of doing the novel activity, or pioneering into a new venture. The company must be intelligible about the needs and the dynamics of the business environment. It must know what are the products that the customer's want, and the qualities that they value. After judging the customers' perspective; the company must analyze its own resources and capabilities, then devise an intelligent strategy to deliver the relevant product.

Risk is defined as the possibility of occurrence of adverse events, or failure to achieve the goal. It can also be defined as a situation in which future economic conditions can not be predicted with certainty. The risk of innovation activities should be considered from two points of view. First - the probability of threats, and secondly - the effects that this occurrence may bring. The most dangerous are those risks that have a strong potential impact on the results of the work. The process of innovation is not an enduring phenomenon, where companies can plan for the future and make the necessary adjustments. Innovation is the process of continually re inventing the business entity, through focusing on intelligent decision making process and product innovation. The companies should view change as a normal practice of the business process, and must be willing to implement the allowable changes as per the environmental factors. Hence, presence of a charismatic and intelligent leader at the managerial helm of the business entity is essential for the implementation of revolutionary ideals. Sometimes, the term innovation is used to denote an improvement over methods, materials, forms of work, etc. An more detailed analysis must be carried out to examine the relationship between innovation and change.

In this paper, we will examine different aspects of risk and innovation and determine the factors that affects the relationship between the two terms.

Disucssion

Innovation

Innovation is generally defined as the creation of a new way of doing something, whether it is concrete or abstract. Innovation plays a key role in the development of sustainable methods of production and of sustainable methods of living because in both cases it may be necessary to create alternatives to conventional ways of doing things that were developed before environmental consideration was central to most people's framework for making decisions. Joseph Schumpeter highlights the importance of innovation in an organization. According to him, innovation is the key to tangible success in an organization. He defines innovation in four different dimensions. One of the main elements that describe competitiveness is innovation (Escorsa, 1997: p. 19).

Because innovation plays a central role in business success as well as in scientific progress, ...