Managing risk by design – lessons for innovation projects from the Cancer Challenge

Key lessons in how to structure a high-risk project that keeps funders happy and give you flexibility in managing innovation programmes.

Everyone says they like innovation, but funders, boards, and organisations are often surprisingly risk averse. When it comes to supporting innovation activities, which can bring significant change – or deliver very little of use – it’s important that you’re able to manage risk and manage stakeholder expectations. Managing risk by design – through careful structuring of your program – provides you with tools to systematically address risk in innovation projects.

If you get the structure of your innovation programme right, everything’s easier to deliver.

In 2016 I led the development of the funding proposal for the Cancer Innovation Challenge, a £1M fund to deliver better outcomes to cancer patients in Scotland. Comparatively, cancer patients in Scotland have below average clinical outcomes – despite Scotland having some of the world’s best cancer data and some of the world’s best data scientists. So the Cancer Innovation Challenge was set up to drive innovation in the use of data for health.

Key risk management lessons from the Cancer Innovation Challenge:

  1. It is difficult to promise innovation if there is no agreement on where you should be innovating.
  2. If risk is a bigger concern than delivery, then you need to structure your programme around a risk management framework. You then need to continue to prioritise risk management. Don’t be afraid to use stage-gates to manage progress, and to give you options to change your approach.
  3. At every stage-gate you need an exit strategy if you’re not getting the results you want. This is particularly true if you’re not able to drive innovation in the way or area that you want, or if the innovation isn’t there. If you can’t exit or pivot as needed, then you need to come up with an explicit project/program management structure that lets you do this.

How focused is your innovation approach?

There is a tension in funding innovation between being open – and seeing what proposals you get – and being proscriptive, and wanting to focus in more tightly defined areas. If you have a very open approach – like supporting ‘Innovative data science solutions to improve cancer care and outcomes’ – then you don’t really have any domain or thematic focus. Open approaches run the risk of getting either generic proposals that you’re not interested in, or interesting proposals that can’t move beyond a proof of concept.

Don’t try and do innovative ‘stuff’. The more focused you are, the more likely you are to get proposals which might deliver real impact.

Design an appropriate delivery model

There have been many health innovation programs that have come and gone and delivered very little impact or change. The Challenge’s funder and Board were keen to make sure that we tried to maximise impact while minimising risk. A key risk was investing in innovation projects that delivered proof of concepts that were unlikely to be adopted.

If you don’t manage the process,
then the process will manage you…

To maximise the innovation potential of the Cancer Challenge, we first set out our strategic approach to delivering the program. We then ran a series of SBRI (Small Business Research Initiative) funding calls to allocate funding.

These funding calls kickstarted our three stage delivery model:

  1. Tendering – an initial stage to select viable ideas that were relevant and potentially deliverable that went to feasibility studies
  2. Feasibility studies with clinicians, patients and the NHS
  3. Tendering – for funding to build proof of concepts based on the feasibility studies
  4. Build proof of concepts, and deploy them if possible

Any company from the EU was allowed to apply, and the Challenge’s Strategic Management Board reviewed proposals and allocated funding.

Managing risks – setting your ground rules

In many projects there are what I would call structural risks. These are approaches which you know in advance are likely lead to dead ends. There may be approaches that are unlikely to work given time/budget/staff constraints. Applicants may not take information access and/or legal issues seriously. They may rely on an external organisation’s support/processes, and so on. It’s important to highlight these risks in advance so everyone is aware of them.

Sometimes you need to design your project so these risks are formally addressed by applicant proposals.

A key challenge for projects working in health and with patient and clinical data is information governance – particularly patient confidentiality. It’s not enough to assume you can get access to data because someone somewhere has it. There are very formal processes you must go through to get access to patient and clinical data. Applicants needed to understand the approval processes, the timeframes, and what sort of approaches to data use and analysis were likely to be approved.

Knowing this, we were able to set clear ground rules for project applicants to ensure that their approaches addressed how they were going to work through this information governance process. As funders, we were then able to sense-check whether proposals were likely to fall at this hurdle. This enabled us to focus on the viable, approvable, and deliverable submissions

Managing risks – using a staged approach

The strength of the Cancer Challenge approach was it’s openness and flexibility. Conversely, funders found that risky. I implemented a stage-gate approach, which gave us exit points at every stage of the process – and at every stage of the delivery model.

  1. If we didn’t get relevant enough or ambitious enough applications, we had a number of options. We could re-run the call,or run a different SBRI call. We could change our area of focus – or decide not to invest in an area.
  2. If the feasibility studies weren’t successful – or raised concerns that were unlikely to be overcome – the stage-gate gave us an opportunity to stop investing in projects that were unlikely to succeed.
  3. A key concern when working with data in the health sector is getting information governance approval. By making this a requirement of the feasibility study, we were able to manage risk and minimise exposure to projects that wouldn’t be deployable

Setting out a staged approach made it clear to applicants, funders and stakeholders that we had a flexible approach that allowed us to respond to a range of different outcomes. This gave the Challenge the tools to take strategic decisions about how the fund would proceed given the applications we received.

Stage gates meant that we weren’t tied into delivering a program that might have limited relevance or impact.

Managing risk though project/program design

Sometimes you can design out risks – and sometimes you have to design them in. Understanding the key risks your innovation approach faces – and building explicit processes to address and manage them – can significantly reduce the level of risk your program faces.

When you’re proactively managing systematic risks it is much easier to deliver effective innovation programs. This approach makes it easier to work with stakeholders and funders, and gives you additional tools to help manage applicants and applications.

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