Algorithm of innovation project risk management

Abstract

Aim. To develop a risk management algorithm that can be used in risk management of innovations.Objectives. On the basis of the current international standards of risk management and scientific publications to study the existing practice of risk management, highlighting the main elements of the risk management process into a single generalized risk management algorithm; based on the results of the first task, as well as taking into account the identified features of the process of innovation implementation, to develop an algorithm for risk management of innovation projects.Methods. The work is based on the study of scientific publications in the field of risk management and analysis of international standards on risk management in order to adapt them to the peculiarities of innovation management.Results. The problem of risk management of innovation projects is one of the most difficult in project management because of the significant degree of uncertainty inherent in innovation. The article reflects the problem of investors’ acceptance of increased risk during the realization of an innovation project. The peculiarity of risk management of innovations is the need to accept increased risk, and in return the opportunity to present a new product or technology to the market. Taking into account the considered peculiarities, an algorithmic approach to risk management of innovation projects is given. The practical significance of the study lies in the possibility of applying the developed algorithm of innovation project risk management by economic entities, which will improve the quality of corporate risk management and increase the efficiency of resource utilization. The authors point out the necessity of selecting a project with positive NPV (discounted cash flow, DCF) and accepting the increased risk of the innovation project in the process of innovation management.Conclusions. The authors have created a comprehensive methodological approach to innovation project risk management in the form of a sequence of actions algorithm. The purpose of its application is to increase the efficiency of risk management and to achieve a successful result of innovation implementation.