You Must Define This Term to De-Risk Innovation

Many organizations fail to define acceptable failure for their innovation program, which is critical for de-risking innovation activities. Various types of organizations have different definitions of acceptable failure, based on their circumstances, politics, environment, culture, and operating constraints. Failing fast or cheaply may be unacceptable for some organizations if it compromises the reputation, client relationships, or future funding. Defining acceptable failure requires a candid conversation with key stakeholders both within and outside the organization. The article stresses that regardless of organization type, defining acceptable failure is a precondition for creating low-risk innovation environment that promotes the desired behaviors in individuals.