The trouble with beautiful, stupid innovation

Photo by Aaron Burden on Unsplash
The top reasons startups fail is often related to poor consideration of commercial realities. Source: https://www.cbinsights.com/research/startup-failure-reasons-top/
McKinsey’s Three Horizon model for business extension

Thinkers and Doers

Sadly, typical business structures often split people into those who have ideas (the thinkers, often executives), and those who implement them (the doers, the teams throughout the business). This leads to a deep disconnect — the thinkers are quickly frustrated as the doers struggle through the hard reality of implementing an idea that has had insufficient consideration.

The typical flow of corporate ‘innovation’ smells of hippo. (or “Highest Paid Person’s Opinion” to you and me)
The common misunderstanding of the payback of an idea revolves around an implicit assumption that ideas remain as certain of success until they’re delivered, as well as an overly common assignment of fixed resource from beginning to end of delivery.
A beautifully simple explanation of how we hope to see uncertainty fall, and costs increase, courtesy of Erdin Beshimov @ MIT. Erdin reminds me that the value of the project should rise with time too.

Innovation is not a four box model

I was once tasked with drawing up a new innovation process for a corporate innovation function. The process would be used by teams of highly talented people to work with new ideas and get them into production. It was important that the process combined the best elements of agile development, lean startup and design thinking.

Research — Ideation — MVP — Delivery. Just another incorrect four-box model of innovation

A grand unified theory for developing new propositions

A big experiment in understanding the innovation process was my experience with Monday Labs, our internal incubator at reed.co.uk. In many ways, Monday Labs benefited from the evolution of the Cooperesque investment gating which Reed used centrally for our programme management process.

A simple model for uncovering ever better reasons to keep developing an idea. What assumption do we need to test? What is the team? How long will they need? When they’re done, what will we know that we didn’t before?
  • What team and other resources do you need to successfully deliver the outcome?
  • How long will it take to reach the outcome (good or bad?)
There are many validation activities, from market research to code spikes or Design Sprints and pop-up shops.
  • What team and other resources do you need to successfully deliver the outcome?
  • How long will it take to reach the outcome (good or bad?)

The art of thinking small

For leaders, and those holding budget, this process lowers costs by reducing investment in projects that will be ultimately unsuccessful. In large organisations, the mistake is often that innovation initiatives increasingly run towards larger, and more expensive ‘moonshot’ gambles. In a fascinating article for MIT Sloan Management Review, Corstjens, Carpenter, and Hasan compared the relative R&D spending and growth between P&G (a large R&D spender) and Reckitt Benckiser (a relatively small spender).

Big spending (and big projects) doesn’t necessarily result in big benefits (source: https://sloanreview.mit.edu/article/the-promise-of-targeted-innovation/)

Embedding the discipline

This simple model is univeral; before undertaking an activity — from considering a new product feature to investing in a multi-year enterprise software rollout — simply stop and consider how exposed you are to the unknown. Have you really been thoughtful about the assumptions that you’re making. Would someone else’s perspective help you make a better decision? Should you spend some time trying to learn more before progressing, and what process will help you get data to make better decisions?

This Series

Part 1: The fairy tale approach to strategy

Postscript

The thinking in this series of articles was informed and inspired by time spent with the talented team at Endjin, Bill Aulet’s Disciplined Entrepreneurship, Eric Ries’ Lean Startup and Jake Knapp’s Design Sprint amongst others.

Technologist, lean evangelist, chaos monkey and Chief Technology Prevention Officer. Loves good coffee, hanging around on ropes and driving about in cars

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