Tuesday, November 29, 2016

Innovation Failure: Ignorance or Arrogance?

In my Twitter stream yesterday I found this nice article by Michael Schrage entitled Embrace your ignorance.  His slightly provocative title is meant to signal that perhaps you live in a self-satisfied bubble of assumed intelligence and knowledge about your customer, when in fact you should be happy to be humble about your ignorance, and act accordingly.

Schrage goes on to extol the values of experimentation and "big data" as methods to discover what customers really want, but here he loses me a bit.  I'd rather go back to an even simpler way of discovering needs, by asking and observing in real time where the real opportunities and pains exist, or where actual solutions fall short or have gaps.  Ethnography, getting close to the customer and their use of a solution or their experience, is what indicates where the opportunities and problems lie.  From those observations we can extrapolate and create potential solutions, which can become the basis for experiments, which will prove or perhaps disprove our hypothesis.  I worry that all the emphasis on "big data" will signal shifts that seem important but aren't, or miss factors that can't be captured in quantitative data.  As Einstein noted, not everything that counts can be counted.

Embracing your Ignorance

Good innovators are humble people.  I don't mean that they are people who grovel, or let others walk all over them.  Certainly Steve Jobs will never be known as a "humble" person in that sense.  What I mean is that they have the scars of experience, of making the wrong assumptions or even having the audacity to suggest they know what customers needed, and failing.  Humility comes when we recognize that customers decide the value and importance of our products and services.  No matter how valuable or important we think they are, customers determine the value.  The faster we understand this and learn to listen and observe, the more likely we are to create innovations that matter.

In our work we've identified a number of attributes that good innovators possess.  One of those we highlight is "beginner's mind" - that is, the ability to examine a problem or opportunity as if for the first time.  Too many times we approach a problem with the full suite of knowledge and experience, never recognizing that all the knowledge and experience narrows the potential scope of outcomes.  Knowledge and experience about candles doesn't open the door to electric light, it merely makes more effective candles.  To think differently and creatively about a problem or opportunity we need to think about it with a beginner's mindset, something that Jobs to his credit did well.  Rather than rush to apply everything we know, instead approach the problem as if for the first time.  In the absence of knowledge or experience, how might you solve the challenge or problem?

Losing your arrogance

Too often corporate innovators are guilty of unintentional arrogance.  They are guilty of assuming that they know what customers want, or worse, of simply creating new technology or new solutions with features that they either think customers want, or features that are simply better than what the competition offers.  This arrogance is often built on past successes that span years, so the arrogance can be earned, and in some cases even justified.  But increasingly the further a person is from a customer and their needs, and the longer it's been since you walked in that customer's shoes, the more likely you are arrogating - the word arrogance derives from - making undue claims in an overbearing manner.  Pride goeth before a fall, but I suspect arrogance goes shortly thereafter.

Ignorance or Apathy?

There's an old joke about education, where the individual in question responds with I don't know and I don't care (Ignorance and/or Apathy).  In the case of a modern day innovator, armed with social media, surveying tools, focus groups, big data, experiments and a host of other methods to gather insight, ignorance simply isn't plausible. There is simply too much data, too much information to plead ignorance about an opportunity.  That suggests apathy, which I'll also reject.  Most innovators I've come in contact with are passionate people, who want to do a good job and deliver value to customers.  What's left after ignorance and apathy?  Well, there are two remaining reasons why innovation discovery fails:  time constraints and arrogance.

The first barrier is a time or resource constraint.  Far too many people recognize the need for more customer interaction, more data analysis, more discovery and experimentation, but they simply cannot find the time.  Highly efficient processes leave little time and room for experimentation or new discoveries.  Thus many innovations are launched on a hope and prayer that the innovator guessed correctly, since they didn't have time to gather needs.  On the other hand is arrogance.  Too many innovators and their companies believe they know what customers need and deliver new technologies or features without ever discovering needs.  They might have the time but don't have the inclination.  This approach happens far more frequently in high tech or software industries, where adding new features is simpler, but it happens in all industries.  Arrogance is a real problem for innovators who assert that they know what customers want, or assert that new products and features are so compelling that they will override customer concerns.

Get rid of your arrogance, get rid of your ignorance

If you are willing to lose a bit of your arrogance, you can easily get rid of your ignorance.  Becoming a bit more humble, interacting with customers, understanding their needs and journeys, will open the door to new discoveries.  With these discoveries you become more knowledgeable about their needs and possible innovation opportunities, which you can test and validate through experiments.  Losing your arrogance helps you lose your ignorance.  Sustaining your arrogance sustains your ignorance and wastes valuable time and resources.
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posted by Jeffrey Phillips at 6:04 AM 0 comments

Friday, November 04, 2016

No idea is an island

The title of this post is a bit provocative, and that's on purpose.  Every company wants to innovate, and further they desire that the limited innovation they accomplish succeed wildly.  This is of course whistling past the graveyard, as most innovations, like most venture capital investments, won't return the initial investment.  Instead, most companies demand innovation results on par with the iPhone while funding innovation with the equivalent of corporate bake sales.  But this post isn't intended to deride the often inadequate resourcing of innovation, it's meant to point out the reasons behind a rather uncomfortable fact:  even good ideas often fail in the marketplace.  This skips right over the outright failure of bad ideas and bad products, of which there are legion.  Those probably deserve to die an ignominious death.  But why do good ideas and products seem to have such a high failure rate?

There are plenty of reasons for good, innovative products to fail in the marketplace.  Perhaps the customers were too aggressive in their needs statements, or not aggressive enough.  Perhaps the innovator identified the right needs but was too early or too late in the market or technology window.  Perhaps the need exists but the effort for the customer to overcome inertia and actually make the change seems too high (this is my challenge with Slack).  Perhaps the product or service actually fills an important need, but there were other, more important or urgent needs that the innovator ignored.  In other words, there are plenty of reasons why good, well-thought out innovations can fail.  But none of these is as important as what Paul Hobcraft and I have been writing about recently.  One of, if not the most important reason good innovative products fail in the marketplace is because they don't fit within an existing ecosystem or plug into an important platform.  That is, they are independent, discrete products when a customer seeks a comprehensive, seamless solution.

The problem with discrete product innovation

Let's imagine that a company identifies customer needs and does a good job generating ideas to arrive at a new product innovation, which it then launches into the marketplace.  Having done everything correctly from their point of view, the innovation team waits with expectation to see how well the product performs.  The consumer, on the other hand, encounters the product, which has a number of new capabilities, bells and whistles, but doesn't integrate usefully or seamlessly into a set of products, services, business models, channels, data and interactions that the customer has already constructed, or had constructed for them.  While the new product outweighs and outranks the product it was meant to replace, the new product ignores connectivity, seamless integration and a host of other factors that the customer cares about to get their "jobs" done.  Jobs, you see, may be broken into discrete activities, but the customer really cares about the total experience or journey.  Optimizing one step in the process but failing to acknowledge the journey doesn't create value, it creates new work for customers, or forces them to change the work they've done.

Platforms and Ecosystems

The English poet John Donne wrote that "no man is an island".  He meant that we are mutually dependent on each other.  Likewise, in a highly integrated, hyper connected word, no product is an island.  It relies on other products, services, business models, channels, data and standards in order to operate.  There are two key ideas at work here:  platforms and ecosystems, and these must matter and shape innovation.

Platforms are simply agreed connectivity standards that become a backplane or common operating infrastructure to allow disparate products, technologies and services to interact.  Google, Amazon and others are creating these platforms where innovators will be able to plug in, interoperate and gain value from the other goods and services residing on the platform.

Ecosystems are comprised of the other vendors, technologies, data and ancillary products and services that offer the customer the full, integrated, cohesive and seamless experience they want. 

Ignore these at your peril

So, back to the lone innovator.  Too often innovators, individual and corporate, are too myopic.  They identify one "job" to be done, and focus narrowly on accomplishing that task with more features, skills or elan.  While doing so the customer plays a role in describing the job or task, but often failing to connect the job to other jobs or tasks that are mutually intertwined or dependent.  Unless the solution sustains the seamless experience or "journey", the customer isn't likely to switch to a new product simply because it is slightly better in the abstract, but deteriorates the rest of the activity, journey or experience.

To be a successful innovator, one must understand the totality of the customers' needs, observe the platforms and ecosystems that provide the comprehensive solution that customers want, which is a total, comprehensive and seamless experience, and then decide what the key needs and features are that the innovator can contribute, and how the idea must be shaped to either fit within an existing ecosystem and platform, or how to radically disrupt the existing ecosystems and platforms and create something new and more compelling for the customer.   Placing a new and interesting discrete product that does not align to the expectations of the customer for a seamless experience or worse interrupts or detracts from an otherwise comprehensive solution is worse than not innovating at all.

Increase experience or reduce friction in the journey
The eventual failure of most good ideas isn't because of market windows or customer needs.  It isn't because the product fails to meet specific targets or price points.  It's because innovators don't open their apertures to understand the totality of customer needs, and in a very connected world don't understand the important platforms and ecosystems that the innovative product will enter.  Once you understand the interconnectedness and create products that sustain or improve that, or reduce friction in a customer experience or journey, your innovations will succeed.  No man, or idea, is an island, and in markets where connectivity and interrelationships are increasing and platforms and ecosystems are ever more tightly woven together, your innovation cannot stand alone.

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posted by Jeffrey Phillips at 6:48 AM 0 comments