Risk is a necessary input to Innovation.
Steve Gass is the inventor of SawStop. He is a risk-taker.
If you are unfamiliar with SawStop, it is a technology developed to prevent table saw injuries. People lose digits far too often. SawStop is able to instantly stop the saw blade if a stray finger comes into the slightest contact with the blade.
If you are a visual person, check out the video of SawStop in action. For those of you who are a tad impatient, you can skip the introductory stuff and go straight to about 3:45 or so in the video. This is the point at which Steve Gass demonstrates a willingness to take personal risk, and faith in his invention, beyond that of any I have seen before.
I’d say he puts his money where his mouth is, but it’s more accurate to say that he puts his finger where the saw blade is.
Fortunately for Steve, and for squeamish viewers, SawStop worked.
Taking risk is an absolute necessity – not an option – for breakthrough innovation. You don’t have to press your finger to a rapidly rotating razor sharp saw blade (and my lawyers advise me to say please, do not try sticking your finger in a rapidly rotating razor sharp saw blade), but you have to accept risk nonetheless.
Such risk comes in the form of risking failure. On the list of greatest human fears, the fear of failure is somewhere just behind public speaking and spiders. Okay, I made that up, but I think it's pretty close to reality.
In the business world, Corporate Atychiphobia (yes, there is a fancy medical word for the morbid fear of failure) prevents organizations from achieving all they can achieve. Breakthrough innovations require pursuing projects that can fail. There simply is no way of getting around that.
Yet managers everywhere (with an admission of my own guilt here included) don’t pursue potential breakthroughs because they won’t accept the risk of failure. This is natural for us humans. As Nobel Laureate Daniel Kahneman points out in his book Thinking, Fast and Slow, numerous psychological tests have shown that, on average, people have a “loss aversion ratio” of around 2 – meaning that their fear of losing is about twice as strong as their enthusiasm for winning. And that’s just an average – for some people, the fear of loss is even greater.
Sometimes, that is a rational decision. When you have a mortgage to pay and kids to feed, it may not make the most sense to risk your career on a major public fiasco. If the organization has a history of punishing failure, the fear will only be heightened.
Executives who want to drive innovation in their organizations must embrace failure. Just as the best stock traders are unemotional and tolerant about losses, so must be the most innovative executives. If you want stock-market level returns on investment, you can’t invest only in T-bills. If you want your organization to have breakthrough-innovation level returns on investment, you can’t invest only in line extensions.
Sometimes, you have to risk your (figurative!) finger on the (figurative!) saw blade.
Regarding the saw, please don’t try this at home.
Regarding your innovation efforts, please do try this in the office.