|By Marketwired .||
|May 6, 2014 10:12 AM EDT||
LEXINGTON, MA -- (Marketwired) -- 05/06/14 -- When trying to get their ideas off the drawing board and into the market, most innovators spend too much time, energy and money using the wrong toolkit to solve the wrong problem. They try to come up with a "perfect idea" that will disrupt the market or change the world. And they apply the wrong management skills: operating and control systems that are optimal for day-to-day execution but often detrimental to the innovation process.
In reality, "perfect" ideas do not exist. Every new idea is partly right and partly wrong. In the "first mile" of development -- i.e., going from the drawing board into the market -- successful innovators use trial-and-error experimentation to refine their ideas and business model. Learning and applying such skills is the only sure path to gaining commercial traction and turning a great new idea into a viable business, according to Scott D. Anthony, Managing Partner and head of the Asia-Pacific operation of strategy and innovation consulting firm Innosight and author of the just-released The First Mile: A Launch Manual for Getting Great Ideas Into the Market (Harvard Business Review Press, May 2014).
The First Mile gives innovators simple tools to help them avoid some of the most common pitfalls of early-stage innovation. Anthony created these tools based on his work with both venture-backed start-ups as well as some of the world's largest companies -- learning from the successes and failures of innovators in businesses of all shapes and sizes, and in a wide range of markets.
"How innovators navigate the first mile will determine whether the idea flies or fails, potentially taking the entire company up or down with it," says Anthony. "Most businesses operate on a principle of maximizing certainty and minimizing mistakes, but the innovation process is rife with uncertainty, mistakes and failure. In reality, mistakes and failure are a necessary part of the process and invaluable in pointing the way toward success -- if you are properly prepared and know how to handle them."
Without The Right Skills, Innovators Are Vulnerable to Four Key Mistakes
When innovators start with the wrong objective, or misunderstand innovation's key imperatives, they are in danger of making four common and often disastrous mistakes:
- Running out of fuel: Money is the lifeblood of innovation. The right kind of planning ensures innovators have sufficient funding to keep the venture running long enough to get market traction.
- Hiring the wrong driver: Not every executive has the right skills -- it takes a unique combination of customer empathy and business savvy. A leader needs both to guide the venture successfully through innovation's first mile.
- Making a wrong turn: Innovators are often lured into empty market spaces with visions of big opportunity (e.g., "blue ocean" and "greenfield" opportunities), but sometimes these spaces are empty for a good reason and the market potential is illusory.
- Spinning out: Too many innovative businesses make the cardinal mistake of scaling too fast, before they nail the economics and business model. To succeed, first nail it, then scale it.
To Succeed, Address Three Burning Questions
"Successful innovation is all about proving you can answer yes to three key questions, rather than assuming they are all true," says Anthony. "Does anybody need it? Can we do it? Do the numbers work? If you can't answer yes to all those questions, and prove it, then the odds that you have a commercially viable idea are quite low. But if you can, you may be on a path to something big."
Three key development hurdles every idea must cross in the first mile:
1. Is there a need? - Prove a deep customer need. Establish that the customer exists; identify the job he or she is struggling to get done; prove the job is important and unsatisfied.
2. Can you do it? - Prove the concept. Confirm that the solution solves the problem repeatedly and reliably; demonstrate that it's superior to other options; define what it looks and feels like.
3. Is it worth it? - Prove the economics. Identify the sources of revenue, as well as the costs, resources and operations required to earn that revenue; identify a viable path to commercialization.
Leading an Innovation Effort Requires Specialized Skills and Systems
Anthony argues that most organizations are short on the right innovation skills, including: a willingness to experiment for its own sake; an ability to welcome and learn from the unexpected; and comfort with rapid course corrections. Most of today's top executives and managers don't have these skills because they did not grow up with the pace of change they face today.
He outlines four leadership mandates that are essential to navigating innovation's first mile:
- Piercing through the "fog of innovation" - Bias action over analysis to avoid "analysis paralysis"; focus more on learning than quantitative targets; use small diverse teams; and task decision makers with experimentation (i.e., don't let them just be "arm-chair innovators").
- Encouraging smart risk taking and not overly penalizing failure - Evaluate people more on successful behaviors than "objective" outputs; use asymmetric reward systems (i.e., large rewards for success and small penalties for failure).
- Knowing how and when to disengage, and ending the plague of "zombie projects" - Stop escalating commitments when you clearly hit a dead end; "shut it down, extract the lessons and celebrate the learning."
- Fostering connections to external experts, customers, and employees - Build formal and informal networks; leverage the "wisdom of crowds"; increase opportunities and avenues for collaboration.
As examples of successful innovators, Anthony points to companies like:
- W.L. Gore & Associates, maker of Goretex, puts experimentation at the heart of its culture: incentivizing teams to self-form around new opportunities, but also regularly giving out "sharp shooter" awards to those who "put down" dead-end projects.
- Netflix built its disruptive technologies and business model through a rigorous and disciplined approach to experimentation -- not just in moving from DVD rental to streaming video, but also in original content production.
- Adobe smartly managed the risk behind transforming its business model from prepackaged software to a software-as-a-service model by testing key assumptions in Australia before spreading the new model globally.
- Citi launched a global collaboration hub that brings together employees from around the world -- its first global challenge in 2011 generated 2,300 hundred ideas from 45,000 employees across 13 business units in 97 countries.
- Unilever maintains a "street" at its Indian headquarters in Hindustan where new product teams pitch ideas to employees.
The First Mile Imperative: Maximize the "Trial," Learn from the "Errors"
"All innovation ventures go through multiple course corrections before finding the exact right path," says Anthony. "In this process, one's arch nemesis is uncertainty in all its forms -- especially assumptions and rosy predictions that the innovator fails to question or verify."
Anthony urges innovators to follow a process called "DEFT" to test their assumptions and prove the commercial viability of their ideas:
- DOCUMENT: Identify hidden assumptions using tools like questionnaires, a single-page "idea resume" or "business model canvas."
- EVALUATE: Appraise the idea from multiple angles using role play scenarios, pattern based analysis and financial models like reverse income statements.
- FOCUS: Narrow and prioritize uncertainties using "certainty tables" and "impact assessment" to focus on the risks with the greatest potential impact.
- TEST & ADAPT: Design in-market and thought experiments that help maximize learning and apply the lessons, so you can refine your business model and strategy and reduce your risks.
He invokes many case studies to illustrate the tools and process steps, including:
- Procter & Gamble's use of computer simulations -- running nearly 10,000 market scenarios -- helped them sharpen their approach to developing in-market trials for a new probiotic product.
- Godrej & Boyce's spot sensitivity analysis to test consumer purchasing power and price points for its successful battery-powered refrigeration system "chotuKool."
- Medtronic carefully crafted pilot programs at a handful of hospitals in India, to develop a disruptive business model that brings pacemakers to patients who sorely needed them, but historically couldn't access or afford the technology.
- U.S. Navy's early testing protocols for radiation shielding in nuclear submarines.
"Great ideas and businesses are forged in the heat of the marketplace, and they never survive their first contact with the market totally intact," says Anthony. "Companies and entrepreneurs need to get past the myth of the 'perfect idea' and focus on trial-and-error experimentation, which is the true test of innovation. If you are systematic in breaking down your assumptions and proving your idea in the market, then you and your idea stand a fighting chance at disruption, and maybe even changing the world."
For a copy of The First Mile or to speak with Scott D. Anthony, please contact Katarina Wenk-Bodenmiller of Sommerfield Communications at +1 (212) 255-8386 or [email protected].
ABOUT SCOTT D. ANTHONY
Scott D. Anthony is the Managing Partner of Innosight. Based in the firm's Singapore office, he leads its expansion into the Asia-Pacific region as well as its venture capital activities (Innosight Ventures). He has worked with clients ranging from national governments to companies in industries as diverse as healthcare, telecommunications, consumer products and software. He is the author of The Little Black Book of Innovation (Harvard Business Review Press, January 2012) and The Silver Lining (Harvard Business Review Press, 2009). He is the co-author with Clayton Christensen of Seeing What's Next (Harvard Business Review Press, 2004), The Innovator's Guide to Growth (Harvard Business Review Press, 2008) and Building a Growth Factory (Harvard Business Review Press, 2012).
Innosight is a strategy and innovation consulting firm that helps organizations navigate disruptive change and manage strategic transformation. We work with enterprise leaders to identify new growth opportunities, accelerate innovation initiatives, and build capabilities. Innosight is based in Lexington, MA, with offices in Singapore and Lausanne, Switzerland.
Sommerfield Communications, Inc.
As more and more data is generated from a variety of connected devices, the need to get insights from this data and predict future behavior and trends is increasingly essential for businesses. Real-time stream processing is needed in a variety of different industries such as Manufacturing, Oil and Gas, Automobile, Finance, Online Retail, Smart Grids, and Healthcare. Azure Stream Analytics is a fully managed distributed stream computation service that provides low latency, scalable processing of streaming data in the cloud with an enterprise grade SLA. It features built-in integration with Azur...
Oct. 5, 2015 10:00 AM EDT Reads: 724
Apps and devices shouldn't stop working when there's limited or no network connectivity. Learn how to bring data stored in a cloud database to the edge of the network (and back again) whenever an Internet connection is available. In his session at 17th Cloud Expo, Bradley Holt, Developer Advocate at IBM Cloud Data Services, will demonstrate techniques for replicating cloud databases with devices in order to build offline-first mobile or Internet of Things (IoT) apps that can provide a better, faster user experience, both offline and online. The focus of this talk will be on IBM Cloudant, Apa...
Oct. 5, 2015 09:45 AM EDT Reads: 368
SYS-CON Events announced today that HPM Networks will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. For 20 years, HPM Networks has been integrating technology solutions that solve complex business challenges. HPM Networks has designed solutions for both SMB and enterprise customers throughout the San Francisco Bay Area.
Oct. 5, 2015 09:00 AM EDT Reads: 559
As enterprises capture more and more data of all types – structured, semi-structured, and unstructured – data discovery requirements for business intelligence (BI), Big Data, and predictive analytics initiatives grow more complex. A company’s ability to become data-driven and compete on analytics depends on the speed with which it can provision their analytics applications with all relevant information. The task of finding data has traditionally resided with IT, but now organizations increasingly turn towards data source discovery tools to find the right data, in context, for business users, d...
Oct. 5, 2015 08:00 AM EDT Reads: 374
SYS-CON Events announced today that MobiDev, a software development company, will exhibit at the 17th International Cloud Expo®, which will take place November 3-5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. MobiDev is a software development company with representative offices in Atlanta (US), Sheffield (UK) and Würzburg (Germany); and development centers in Ukraine. Since 2009 it has grown from a small group of passionate engineers and business managers to a full-scale mobile software company with over 150 developers, designers, quality assurance engineers, project manage...
Oct. 5, 2015 05:00 AM EDT Reads: 688
The broad selection of hardware, the rapid evolution of operating systems and the time-to-market for mobile apps has been so rapid that new challenges for developers and engineers arise every day. Security, testing, hosting, and other metrics have to be considered through the process. In his session at Big Data Expo, Walter Maguire, Chief Field Technologist, HP Big Data Group, at Hewlett-Packard, will discuss the challenges faced by developers and a composite Big Data applications builder, focusing on how to help solve the problems that developers are continuously battling.
Oct. 5, 2015 04:00 AM EDT Reads: 353
“The Internet of Things transforms the way organizations leverage machine data and gain insights from it,” noted Splunk’s CTO Snehal Antani, as Splunk announced accelerated momentum in Industrial Data and the IoT. The trend is driven by Splunk’s continued investment in its products and partner ecosystem as well as the creativity of customers and the flexibility to deploy Splunk IoT solutions as software, cloud services or in a hybrid environment. Customers are using Splunk® solutions to collect and correlate data from control systems, sensors, mobile devices and IT systems for a variety of Ind...
Oct. 4, 2015 09:45 PM EDT Reads: 569
Clearly the way forward is to move to cloud be it bare metal, VMs or containers. One aspect of the current public clouds that is slowing this cloud migration is cloud lock-in. Every cloud vendor is trying to make it very difficult to move out once a customer has chosen their cloud. In his session at 17th Cloud Expo, Naveen Nimmu, CEO of Clouber, Inc., will advocate that making the inter-cloud migration as simple as changing airlines would help the entire industry to quickly adopt the cloud without worrying about any lock-in fears. In fact by having standard APIs for IaaS would help PaaS expl...
Oct. 4, 2015 02:30 PM EDT Reads: 400
Organizations already struggle with the simple collection of data resulting from the proliferation of IoT, lacking the right infrastructure to manage it. They can't only rely on the cloud to collect and utilize this data because many applications still require dedicated infrastructure for security, redundancy, performance, etc. In his session at 17th Cloud Expo, Emil Sayegh, CEO of Codero Hosting, will discuss how in order to resolve the inherent issues, companies need to combine dedicated and cloud solutions through hybrid hosting – a sustainable solution for the data required to manage I...
Oct. 4, 2015 02:00 PM EDT Reads: 415
SYS-CON Events announced today that IBM Cloud Data Services has been named “Bronze Sponsor” of SYS-CON's 17th Cloud Expo, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. IBM Cloud Data Services offers a portfolio of integrated, best-of-breed cloud data services for developers focused on mobile computing and analytics use cases.
Oct. 4, 2015 01:00 PM EDT Reads: 554
SYS-CON Events announced today that ProfitBricks, the provider of painless cloud infrastructure, will exhibit at SYS-CON's 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. ProfitBricks is the IaaS provider that offers a painless cloud experience for all IT users, with no learning curve. ProfitBricks boasts flexible cloud servers and networking, an integrated Data Center Designer tool for visual control over the cloud and the best price/performance value available. ProfitBricks was named one of the coolest Clo...
Oct. 4, 2015 01:00 PM EDT Reads: 717
Learn how IoT, cloud, social networks and last but not least, humans, can be integrated into a seamless integration of cooperative organisms both cybernetic and biological. This has been enabled by recent advances in IoT device capabilities, messaging frameworks, presence and collaboration services, where devices can share information and make independent and human assisted decisions based upon social status from other entities. In his session at @ThingsExpo, Michael Heydt, founder of Seamless Thingies, will discuss and demonstrate how devices and humans can be integrated from a simple clust...
Oct. 4, 2015 12:00 PM EDT Reads: 620
You have your devices and your data, but what about the rest of your Internet of Things story? Two popular classes of technologies that nicely handle the Big Data analytics for Internet of Things are Apache Hadoop and NoSQL. Hadoop is designed for parallelizing analytical work across many servers and is ideal for the massive data volumes you create with IoT devices. NoSQL databases such as Apache HBase are ideal for storing and retrieving IoT data as “time series data.”
Oct. 4, 2015 10:45 AM EDT Reads: 442
Mobile messaging has been a popular communication channel for more than 20 years. Finnish engineer Matti Makkonen invented the idea for SMS (Short Message Service) in 1984, making his vision a reality on December 3, 1992 by sending the first message ("Happy Christmas") from a PC to a cell phone. Since then, the technology has evolved immensely, from both a technology standpoint, and in our everyday uses for it. Originally used for person-to-person (P2P) communication, i.e., Sally sends a text message to Betty – mobile messaging now offers tremendous value to businesses for customer and empl...
Oct. 4, 2015 08:30 AM EDT Reads: 158
SYS-CON Events announced today that Cloud Raxak has been named “Media & Session Sponsor” of SYS-CON's 17th Cloud Expo, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Raxak Protect automates security compliance across private and public clouds. Using the SaaS tool or managed service, developers can deploy cloud apps quickly, cost-effectively, and without error.
Oct. 3, 2015 01:15 PM EDT Reads: 581
Who are you? How do you introduce yourself? Do you use a name, or do you greet a friend by the last four digits of his social security number? Assuming you don’t, why are we content to associate our identity with 10 random digits assigned by our phone company? Identity is an issue that affects everyone, but as individuals we don’t spend a lot of time thinking about it. In his session at @ThingsExpo, Ben Klang, Founder & President of Mojo Lingo, will discuss the impact of technology on identity. Should we federate, or not? How should identity be secured? Who owns the identity? How is identity ...
Oct. 3, 2015 11:00 AM EDT Reads: 412
SYS-CON Events announced today that Solgeniakhela will exhibit at SYS-CON's 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Solgeniakhela is the global market leader in Cloud Collaboration and Cloud Infrastructure software solutions. Designed to “Bridge the Gap” between Personal and Professional Social, Mobile and Cloud user experiences, our solutions help large and medium-sized organizations dramatically improve productivity, reduce collaboration costs, and increase the overall enterprise value by bringing ...
Oct. 2, 2015 10:00 PM EDT Reads: 551
Sensors and effectors of IoT are solving problems in new ways, but small businesses have been slow to join the quantified world. They’ll need information from IoT using applications as varied as the businesses themselves. In his session at @ThingsExpo, Roger Meike, Distinguished Engineer, Director of Technology Innovation at Intuit, will show how IoT manufacturers can use open standards, public APIs and custom apps to enable the Quantified Small Business. He will use a Raspberry Pi to connect sensors to web services, and cloud integration to connect accounting and data, providing a Bluetooth...
Oct. 2, 2015 03:30 PM EDT Reads: 394
SYS-CON Events announced today that Micron Technology, Inc., a global leader in advanced semiconductor systems, will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Micron’s broad portfolio of high-performance memory technologies – including DRAM, NAND and NOR Flash – is the basis for solid state drives, modules, multichip packages and other system solutions. Backed by more than 35 years of technology leadership, Micron's memory solutions enable the world's most innovative computing, consumer,...
Oct. 2, 2015 07:00 AM EDT Reads: 563
Nowadays, a large number of sensors and devices are connected to the network. Leading-edge IoT technologies integrate various types of sensor data to create a new value for several business decision scenarios. The transparent cloud is a model of a new IoT emergence service platform. Many service providers store and access various types of sensor data in order to create and find out new business values by integrating such data.
Oct. 1, 2015 02:30 PM EDT Reads: 405