EconPapers    
Economics at your fingertips  
 

Improving the Management of Innovation Risks - R&D Risk Assessment for Large Technology Projects

Ralf Dillerup, Daniela Kappler and Fiona Oster

Journal of Management and Strategy, 2018, vol. 9, issue 1, 31-52

Abstract: Global network structures of products and services are important value creators for many companies. Complex business models include a variety of relationships and interrelationships within and across different systems particularly in the case of innovation processes. This increases innovation risks. Risk management is becoming more and more important and is crucial for the German Machinery and Plant Engineering Industry (MPEI). Many companies are medium-sized and are using standard static risk management methods. Use of these methods often means that critical situations are detected late, they do not help in the understanding of problem characteristics and their interdependencies and, consequently, lead to erroneous decisions. Therefore, the modelling of cause-and-effect structures of innovation risks in the German MPEI facilitates the exploration and understanding of the behavioral dynamic of risk clusters. In a comparison of standard risk assessment with the Causal Loop Diagram and the System Dynamics Model of Innovation Risks, the potential of System Dynamics for systemic and multi-dimensional risk management is demonstrated. In this paper, particular emphasis is given to the risk of shortages of skilled workers from a common and System Dynamics perspective. This is relevant as these shortages are the main risk associated with innovation, impacting on project timings, output and performance amongst others. The research concludes that the development of specific System Dynamic models can help to overcome certain problems and incorporate multi-causal interconnections and multidimensional views on risk.

Keywords: innovation risk; holistic risk management; complexity; dynamic; risk systems; risk analysis; risk aggregation; system dynamics (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed

Downloads: (external link)
http://www.sciedu.ca/journal/index.php/jms/article/view/13055/8081 (application/pdf)
http://www.sciedu.ca/journal/index.php/jms/article/view/13055 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:jfr:jms111:v:9:y:2018:i:1:p:31-52

DOI: 10.5430/jms.v9n1p31

Access Statistics for this article

Journal of Management and Strategy is currently edited by Jenny Zhang

More articles in Journal of Management and Strategy from Journal of Management and Strategy, Sciedu Press
Bibliographic data for series maintained by Jenny Zhang ().

 
Page updated 2022-11-12
Handle: RePEc:jfr:jms111:v:9:y:2018:i:1:p:31-52