Rewarding Risk Taking
So How Do We Reward Risk-Taking?  
by Robert Tucker, president of The Innovation Resource

Five years ago, appliance makers Maytag and Whirlpool both faced a
recessionary environment, intense global competition, and products that
consumers could not tell apart. Maytag elected to hunker down and cut
costs while Whirlpool took a different tack. Under then-CEO Dave
Whitwam, the company launched an all-out, enterprise-wide initiative to
develop a core competency in innovation. Not having a cookbook to
follow, they experimented with how best to reward risk-takers and
foster a culture where ideas were welcomed, supported, and funded.

Now the results are in. Maytag, a once-great American brand, cost
cut its way to near-oblivion, while a reenergized Whirlpool grew by 36
percent into a global appliance powerhouse. Whirlpool is in the final
stages of buying up Maytag for a fraction of its former worth.

More and more companies are embracing Whirlpool's strategy as they
see the limits of Maytag's. Yet in attempting to drive organic growth
to supplement acquisitions, companies routinely find they lack the
champions and risk-takers needed to dream up and execute bold new
ideas. "We've been operationally-minded for so long," they tell me,
"that we are having trouble finding entrepreneurially-minded folks to
lead the charge." [more]