RISK MANAGEMENT AS A DETERMINING FACTOR IN THE EFFECTIVENESS OF INNOVATION MANAGEMENT

Innovations are a key factor in competitiveness but are accompanied by risks such as technological failures and unpredictable market reactions. Effective risk management helps organizations minimize threats, stimulate creativity, and maintain long-term success by ensuring a balance between innovation and risk. This study analyzes the relationship between risk management and innovation management effectiveness. By evaluating how organizations can balance innovative efforts with the need for risk management, the paper emphasizes the importance of implementing risk management strategies to enhance innovation outcomes. Special attention is given to how risk management helps companies make strategic decisions, build an innovation culture, and effectively cope with challenges in competitive and market instability conditions. Risk management in the context of innovation plays a crucial role in the successful implementation of innovation projects. Innovations, by nature, are associated with uncertainty and risks that can significantly affect their success. The risk management process includes identifying, assessing, mitigating, and monitoring various types of risks—technological, financial, market, and organizational. This process helps organizations not only minimize potential threats but also effectively leverage opportunities arising from these risks. The article discusses key stages of risk management and how they can be integrated into innovation processes to ensure the successful implementation of projects and achieve long-term growth and competitive advantages.