Positive Risk Taking

“Positive risk-taking” has become something of a buzzword. At our Resilient Institutions conference about Canada’s institutional response to the COVID-19 pandemic, we heard clearly about how the often risk-averse public service acted with agility, speed, and innovation to rapidly develop and deliver programs under unprecedented circumstances. The Canadian Emergency Response Benefit (CERB), which was quickly developed and deployed to reach millions of Canadians, is a great example of this. Similarly, at our recent webinar on complexity in the public sector, we discussed the importance of encouraging positive risk-taking in public policy environments increasingly defined by uncertainty and cross-cutting challenges.

What is positive risk taking?

In a non-exhaustive online search, one finds that the term is referenced in literature as diverse as project management, social services, health, and public administration. From a project management perspective, Christian Bisson suggests: “The word “risks” carries a negative connotation, which is why project managers tend to believe risks should be mitigated or avoided as much as possible. But that common belief means you may be missing out on opportunities. A negative risk is a threat, and when it occurs, it becomes an issue. However, a risk can be positive by providing an opportunity for your project and organization.” (You can read his full article here).

For our purposes in the governance space, positive risk-taking generally refers to the deliberate and thoughtful process of identifying, assessing, and embracing risks that have the potential to yield beneficial outcomes. This approach can be seen in contrast with more traditional approaches to risk management, which focus primarily on avoiding risks to minimize potential losses. Positive risk-taking not only acknowledges that some level of risk is inherent in all activities but also sees that, when combined with attention to important accountability safeguards, making calculated risks can lead to innovation, growth, and improved performance.

Ideas for path forward

Recognizing that positive risk-taking can lead to improved outcomes or opportunities is one thing; understanding the necessary incentives and conditions for this approach to succeed is another.

With our collaborators at the Institute on Research for Public Policy, we made the following recommendation to governments in our Resilient Institutions report: “incorporate positive risk-taking into public service processes to advance innovative ideas, improve service delivery and achieve better outcomes” (p. 57). This recommendation is followed by some specific ideas, such as encouraging positive risk-taking in senior ranks, as well as conducting assessments of internal processes to determine opportunities and barriers.

Leadership is key in the equation, as leaders must set the tone for a culture where calculated and positive risk-taking is encouraged. This includes recognizing and rewarding innovative efforts and providing safety for employees to propose and test new ideas without fear of retribution for failure. Cross-departmental collaboration can also enhance the quality and impact of risk-taking initiatives. Sharing knowledge and experiences across the public service can help identify best practices and manage downsides.

To conclude, one thing we know for certain is that uncertainty, risks and complexity are here to stay. Positive risk-taking as part of sound public governance is an approach worth exploring and incentivizing.