Careers and companies rise and fall based on being right about how much innovation to take on at any given time. Reach too far and you risk ridicule, delays in time to market, and slow market development. Not surprisingly, it often seemed safer to stick to the middle ground: Investments in product enhancements or business extension for which there is strong supporting data. But today, you shun the lunatic fringe at your own peril. A small leap may not put you on firm ground.
A Case and Lessons Learned
I recently attended an EMBS talk on the latest scanning, parametrics, and 3-D printing developments. The speaker was Scott Summit. His company, Bespoke Innovations makes functionally and esthetically personalized prosthetic leg coverings. For the coverings to achieve their first objective – restoring visual symmetry to the wearer’s body – they need an accurate digital scan of the person’s body. What he recounted about the recent history of body scanning technology is a warning to all of us in any industry:
- Approximately 3 years ago, to get a body scan he needed to take the customer to a lab that had a 1M machine and would provide scans at $800/scan.
- Shortly thereafter, there were hand-held devices that cost $40,000 to $60,000 a piece and were very tricky to use.
- Scott’s company developed their own scanner but it was soon overtaken in price/performance by…
- A scanner that Microsoft developed. Shortly after that product became available…
- Autodesk announced that anyone could download their 123D Catch software product for free. This enables anyone with a digital camera to take photos that the software then stitches together to create a 3-D model. For free.
Just hearing about this drop — from $1M to $0 in approximately 3 years — is dizzying. Can you imagine how each of those obviated product providers felt? There are Five Stages of Grief, and I have seen Four Stages of Losing this kind of competitive fight:
- Denial: “It’s a much less powerful product. “ “We only see them in Germany.” “Our customers will never accept that.”
- More Enhancement: “We will have better [fill in the blank: Specs? Bathrooms? You Tube videos?]”
- Capitulation: “We have other more strategic businesses on which to focus”
- Rationalization: “Sheila never invested enough in it.” “Joe wasn’t the right person to lead it.”
The lessons that people take away from competitive failures are not always right. Maybe there were other issues, but maybe the real lesson is this: “We lost by playing it safe. We did not target a big enough change; as a result, our investments went toward enhancements while others produced a much bigger leap in value for customers.”
There are definitely still situations that call for investments in minimally or moderately innovative projects. But my point is that there are fewer of them now than before. At the current pace of change and competition, many medium-impact projects simply do not make sense: They will be rendered irrelevant soon or even before they are out the gate.
Implications: How to Win in This Environment
- Become the voice, in your head and in your company, for the “Is it bold enough to be safe?” investment criterion.
- Become expert in the techniques for evaluating bold ideas. For every bold idea that is wildly successful there are 17 that turn out to be just wild. More on this in future posts.
- Become expert in the techniques for implementing bold ideas in ways that manage risk. More on this in future posts.
Have you changed your project selection to match a faster pace of change?
How have you mitigated the higher risk associated with bigger leaps in contribution?