This blog post has an interesting Risk Test: 7 Answers You Need to Know. The questions are posed for finance/CFO risks, but are equally valid for R&D risk management as well:
The science of risk management continues to evolve. Lessons learned from past failures are being leveraged to ensure that a company’s risk management is built on the right foundation and evolving in the right direction.
Without further ado, here are the questions:
- What is our risk taxonomy?
- How do we quantify risk?
- What is our risk appetite?
- What return are we generating for the risks we take?
- How do we separate responsibility for risk-taking from responsibility for risk management?
- How do we include risk when we compensate risk-takers?
- How do we ensure that our risk management is performing well?
Historically, R&D risk management is somewhat fragmented. Some informal risk management during R&D and a lot in quality control at the end of the process. However, the process sometimes lacks rigor and is not comprehensive. A taxonomy for R&D risks will go a long way in helping. As the author points out, no taxonomy is perfect. But any disciplined use of a taxonomy will help answer the remaining questions as well.