Recently I corresponded with a reader who was concerned about the implied negativity around the “odds” of success described in these posts.
I have done quite a bit of research on the odds around product development and am comfortable with my numbers. It is not much different than saying that 1 out of 5 small business startups succeed. I have actually been pushed toward these terrible odds by the senior people I have worked with in product development.
My view is to embrace the numbers. Success comes from dealing well with failure. Run through the things that don’t work. Kill dumb ideas. If you have only one or two new products, it is really hard to prioritize and pick between the winners and failures. View it from a portfolio perspective — an investor who buys one stock is gambling.
Or you could choose to look at it another way: how does one actually calculate the success ratio? What is the numerator, and what is the denominator? A researcher working at the bench may see lots of failures. The chairman, who validates the decision to launch a fully refined product, sees completely different ratios.
It is a lot like sales. When I was young and naive, if someone called and asked about my product, I figured that was about as good as a sale. Now when I have a new lead, it does not even register until there has been a great deal of qualification. As we manage a sales effort, we recognize that it takes multiple leads to result in a sale, and we organize accordingly. We need to recognize that similar metrics apply to new product development.
Many organizations do not recognize that they have an innovation problem.
Last year I attended an industry-sponsored event that included a dinner with “thought leaders” on the subject of innovation.
The event started predictably enough with statements such as, “our only problem is finding enough good people”, or “we have so many ideas, the problem is sorting through them.”
After several bottles of wine, the comments became more candid:
- “Our management only allows us to innovate by modifying packaging, color or size of our existing product line.”
- “How do we even start?”
- “Where do you find decent ideas?”
- “There are no good new product people anymore.”
One confided – “We lost a major opportunity simply because we could not figure out how to get a sample roll through the SAP system.”
There is a revolution taking place in innovation and product development, but many companies are wedded to the old way of doing things. Like the dinosaur, they will face extinction unless they learn how to innovate quicker at lower costs and shorter time to market.
Problem solving, however, is not without rules. We run trials of one kind or another almost every day. Failure is a big part of our world, and learning from these failures is how we capture value from the activity. As we have found many wrong ways to run trials, we have developed techniques for when things are not going well.
This summer I was introduced to a very special deck of cards, Oblique Strategy cards. These were developed by two artists (Brian Eno and Peter Schmidt) in 1975 to facilitate what is called lateral thinking. Education teaches us to problem solve by digging deeper into a subject. Lateral thinking, or a lateral strategy, is one that basically picks one up and suggests a new start. Each card has a thought or concept that is designed to move our thinking – laterally.
The first card I pulled from the deck was, “Do we need holes?” For what I was working on at the time – the concept was break-through. Use the links above to learn more.
One of my favorite and often used aphorisms is, “Perfection is the enemy of good.”
Very often the essence of a promising development is obscured by added features or over-refining of an idea.
This concept is usually attributed to Voltaire. Business leaders have nuanced it: Edward de Castro, one of the founders of Data General, said, “Not everything worth doing is worth doing well”.
This philosophy was wonderfully chronicled in Tracy Kidder’s “The Soul of a New Machine”.
Case in point: the concept of the “minimum viable product” practiced thirty five years before the term.
Get the product in front of the customer now!
There are many versions of this story, which is often attributed to Ronald Reagan, but it also serves as a good metaphor for those in Product Development.
There are twin boys of five or six. Mom was worried that the boys had developed extreme personalities — one was a total pessimist, the other a total optimist — their parents took them to a psychiatrist.
First the psychiatrist treated the pessimist. Trying to brighten his outlook, the psychiatrist took him to a room piled to the ceiling with brand-new toys. But instead of yelping with delight, the little boy burst into tears. “What’s the matter?” the psychiatrist asked, baffled. “Don’t you want to play with any of the toys?” “No,” replied the pessimist, “I want a pony.”
Next the psychiatrist treated the optimist. Trying to dampen his outlook, the psychiatrist took him to a room piled to the ceiling with horse manure. But instead of wrinkling his nose in disgust, the optimist emitted just the yelp of delight the psychiatrist had been hoping to hear from his brother, the pessimist. Then he clambered to the top of the pile, dropped to his knees, and began gleefully digging out scoop after scoop with his bare hands. “What do you think you’re doing?” the psychiatrist asked, just as baffled by the optimist as he had been by the pessimist. “With all this manure,” the little boy replied, beaming, “there must be a pony in here somewhere.”
Very often the trick is indeed finding the pony!
WHY THIS BLOG:
Companies today need to become much better at innovation. While most organizations claim to foster new products, their actual track record is poor. Managers are using old tools and methods to shape the future.
Except for the rare companies, such as Google or P&G that are richly endowed with a culture of innovation, most managers are left to fumble or improvise a process for developing new products. Regrettably — these improvisations are likely to fail.
Yet it is the nimble smaller firm, when combined with an appropriate innovation strategy, that has the greatest chance for success.
My goal is to help those who are struggling with PD to find a successful path through the art and science of innovation.