Risk-taking and smart failures ‘necessary’ for agency innovation — report
Most innovative agencies share a common element in the way they acquire and develop new technology: They’re unafraid to take risks and fail in a productive and intelligent way, according to a new report from the Partnership for Public Service.
More than 70 percent of the dozens of respondents to the partnership’s report, “Innovation Is A Contract Sport,” agreed that agencies must not let failure or risk stop them from innovating. The report highlights several ways in which federal agencies are getting creative in the acquisition space to ensure more successful outcomes of research, development and procurement, specifically citing Department of Homeland Security and Intelligence Advanced Research Projects Activity interviewees who embrace failure in search of high-risk, high-payoff innovation.
“Innovations arise when people are given a problem to solve instead of being told to implement a known solution,” the report reads. “Indeed, many of our nation’s breakthrough innovations came from a challenge that did not have a clearly defined solution.”
Even according to the Federal Acquisition Regulation, which is often thought of as anti-innovation, “Reasonable risk-taking is appropriate as long as risks are controlled and mitigated.”
The very first page of the FAR, the report points out, says: “If a policy or procedure, or a particular strategy or practice, is in the best interest of the Government and is not specifically addressed in the FAR, nor prohibited by law (statute or case law), Executive order or other regulation, Government members of the Team should not assume it is prohibited. Rather, absence of direction should be interpreted as permitting the Team to innovate and use sound business judgment that is otherwise consistent with law and within the limits of their authority. Contracting officers should take the lead in encouraging business process innovations and ensuring that business decisions are sound.”
The report recommends several ways agencies can mitigate risk by implementing projects on smaller scales, such as modular contracting, challenge competitions, parallel contracts, incentive-based contracts and others.
Embracing risk-taking and smart failure was one of three top-level recommendations PPS issued in the report; it also encourages agencies to better partner with industry and academia, and create a culture of innovation.
