Improvement of innovation project risk identification by applying RBS method

Abstract

The paper is related to innovation project risk identification, which happens to be an initial phase in the most of risk management processes and methods classifications. Especially, one of the key characteristics of innovation projects is that of high level risk-taking, due to the fact that this type of projects is related to implementation of new ideas i.e. realization of new products, services, processes etc. that should lead to competitive advantage and market superiority. This hugely depends on creativity, frequently tending to start from experimental procedures and objectives loosely defined in the ideation phase, requiring a fast learning in order to move on. As a result, successful exploitation of new ideas and the first project realization under given conditions requires innovation project team to be more dynamically engaged in innovation project risk management. Particularly, the Risk Breakdown Structure (RBS) as a risk identification method is illustrated for selected innovation project, connected with the Work Breakdown Structure (WBS). The innovation project WBS is based on the Stage-Gate model for product innovation. An example is used to illustrate the combination of RBS/WBS to generate a matrix structure for evaluating the risk concentration, called Risk Breakdown Matrix (RBM).