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


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