Successful innovation is never guaranteed – it always entails a certain amount of risk. But if employees don't understand the types and amounts of risks that are acceptable, they might not be willing to get into the innovation game.

Creating an environment that is more conducive to innovation starts with being more explicit about what risk-taking really means, and defining what is acceptable and what is not.

Here are four tactics for doing this:

1 Publicly define a smart risk The better innovation companies distinguish the areas where risk is encouraged and where it is not. These guardrails should define the “safe zone” for innovation and they should include specific parameters such as time or financial impact.

2 Use the right words to encourage the right culture Language drives behaviour and creates a mindset around what is acceptable and what is not. For example, using terms such as “experiment” or “scouting mission,” instead of “successful v unsuccessful project” signal a more open attitude toward risk. Centring innovation activities on the concept of “exploration” eases the tension associated with trying new things.

3 Keep it nimble and small Size matters and, when it comes to innovation risk, smaller – and faster – experiments are often better.

4 Establish clear phases and criteria for funding projects If you currently have risky (and expensive) innovations in your pipeline, stop providing blank cheques. Instead, fund each project in clearly defined phases. If it passes one phase, give it additional funding. – Copyright Harvard Business Review 2014