Do you avoid or accept risk?

A New York Times story on the Italian auto maker Fiat offered an assessment by company executives that deserves note by those involved in strategic thinking.

Fiat is exploring acquiring Chrysler or possibly GM's European Opel brand.  Fiat executives say the difference between their company, which has risen from near failure and now even owns the legendary Ferrari, Alfa Romeo and Maserati brands, and U.S. automakers, is that Fiat sees itself as needing to take risks and the U.S. automakers see themselves as needing to avoid risks.

To illustrate the point, they note that in 2000 Fiat entered into a partnership with GM to make an advanced diesel engine based on Fiat's technology.  Four years later GM paid Fiat $2 billion to leave the partnership.  Fiat executives say GM was highly bureaucratic and became disinterested in continuing to develop the advanced engine.  After the partnership dissolved Fiat developed the more efficient and less polluting engine on its own, which will be introduced this fall.  Fiat's top engine technology executive says without the burden of GM's bureaucracy "We could have been in production five years ago."

Sometimes not doing something can seem like the safe route, and it certainly can be, as Mercedes learned from its disastrous experience owning Chrysler.  But change and risk are two sides of the same coin.  If you must change to survive and prosper, then you must accept a measure of risk. 

Is your organization set in its ways, bureaucratic and change-resistant?  If the world about you is changing and calling on you to change with it, being risk averse may lead to the edge of a cliff you don't see today.