Failures of Innovation: Failure to Execute

Urgency is a key component of execution.

Failure to execute can occur at many different levels in an organization or even while bringing an innovation to market. That failure can occur at the concept stage, the development stage, the pre-launch stage and upon launch. Adequate execution at each stage is critical to overall success in driving innovation. An important aspect of execution is urgency. Time is the great destroyer of opportunity; the right time to act is never later. If innovation does not occur with urgency, opportunities evaporate, resources and budgets are consumed and you risk being overtaken by competitors. Start-ups inherently understand this as they are generally burning more cash than they are generating and there is a race against time to build positive cash flow. This same urgency should be adopted by well established, resource rich companies as well when bringing innovation to market - and for the same reasons.

Time is money.

This is true in all aspects of business, but is especially true in innovation. At the concept phase, it is vitally important to reduce a concept to a working, physical model as soon as possible. We have all witnessed wasted time and lost resources spent while over-thinking and second-guessing concepts. The surest way to overcome uncertainty and unknowns is to reduce those unknowns to a testable model as early as possible. This allows you to de-risk your investment and increase speed to implementation.

Think it. Build it. Test it. Repeat until successful.

Working models highlight possibilities, conflicts, and shortcomings on a small scale far better than theoretical constructs and can definitively allow you to test or evaluate outcomes. Theoretical models are full of inherent assumptions and estimates which lead to some level of uncertainty in the results. Assumptions and estimates are eliminated in a working physical model, or at least reduced to concrete, verifiable action. It will either work, or not work and identify if the model assumptions and estimates are valid or not. This approach works for business models, software, and business processes as well as it works for physical products. Perform some level of due diligence, but move quickly to a working model to validate your ideas.

An important tool in the “Think it. Build it. Test it.” approach for small product design and development over the last decade has been additive manufacturing. Anyone in product design today who is not employing additive manufacturing for product development is missing an enormous opportunity. Much has been made about the ability of additive manufacturing to advance product development and it is well earned. Commercial additive manufacturing devices “print” a complex part in high fidelity from a large variety of materials directly from a set of design drawings. These systems operate exactly like a networked paper printer allowing them to be a shared resource across multiple manufacturing or product development sites. I have used a networked additive printer to deliver finished parts on a next day basis across the country. A product development group in Minneapolis for which I had oversight would routinely print a design to a networked device in Houston, where it would be finished and returned via overnight mail to Minneapolis. This allowed a development site without the internal resource of a 3D printer to make rapid prototypes for customer review before committing to final design tooling. Often additive printers at a given site do not operate at 100% capacity all the time. Networking printers across an organization can leverage the capability across multiple sites to drive efficiency or support the investment in specialized equipment that a single site alone may not find justifiable. This, of course, requires cooperation across sites, prioritization of projects and coordination among disparate business units, which is often challenging in large matrixed organizations. As such, this coordination and planning may be most effectively driven at the enterprise level of an organization.

Don’t let the pursuit of perfection get in the way of your success.

An imperfect innovation that is first to market is likely to have far greater returns than a perfect solution that comes to market later. The first to market advantage is significant and presents a serious barrier to followers. Often the first to market, even with a sub-optimal offering, captures significant, loyal market share. There exists a certain inertia that prevents change in organizations. Often, barring a significant economic incentive (savings >15% – 20%), there is little desire for prospective customers to push change through the management approval process, even though the existing solution may be sub-optimal for the business. For consumer products, there is also often a barrier to replacement due to cost or convenience, so a consumer may stick with a sub-optimal innovation and wait to enjoy the benefits of a perfect solution when their current product meets the end of its useable life. Thus, the first to market innovation is often firmly entrenched, even though superior products may follow. Once entrenched, the first to market solution is then free to incrementally improve its offering with future product revisions while keeping latecomers at bay, even if the latecomer has a superior product. Knowing this, it is important to identify the qualities of a minimum viable product. Those characteristics not critical to the minimum viability can be relegated to a forthcoming revision to be launched later. Likewise, “nice to have” features that turn out to be more challenging to develop before the product launch date can be demoted to a future iteration. This also requires one to think about innovation as a series or lifecycle of revisions rather than a single product or service. A great example of this is Apple's iPhone, where innovations are added in a new model at regular intervals rather than infrequent, all-encompassing roll-outs.

Failure to execute can occur at many levels in an organization.

Speed and commitment in action are vital at all stages of innovation from initial development to final product launch. Even after all the development has taken place, I have still witnessed significant delays in major development programs due to delays in the Authorization for Expenditure (AFE) stage of a new product. I managed a group at a large industrial company developing a new product for the oil & gas industry. After a several year development program had concluded, the commercial group believed that the “timing wasn’t quite right” to submit the AFE which would provide for capital funding to execute the manufacturing of the new product. Shortly thereafter, the group President, who’s signature was required, left the company. This required the AFE justification and senior management confidence in the project to be built anew with the incoming President. Ultimately, after several months the new President signed off on the AFE, but shortly thereafter he was also reassigned. The third President to oversee the project immediately placed a hold on the significant capital expenditure until they could personally review it as well. Ultimately, the project was approved and moved forward to product launch, but an initial small delay in submission of an AFE resulted in over one year of lost time in the product launch due to instability at the senior management level in the organization. The best time to act is always now, even if it seems inopportune in the moment.

You should always be mindful of execution delays in bringing innovation to market. Especially in rapidly developing markets or high technology areas, the pace of innovation is very rapid. Small delays in execution can add up over time, dramatically delaying implementation and delaying the ultimate benefits of that innovation, whether it be internal cost efficiencies or market growth. You also don’t want execution delays to result in second-to-market status, as that will likely leave you at a permanent disadvantage.

Think it. Build it. Test it. And remember, the right time to act is never later.

Up next: Failures of Discipline in Bringing Innovation to Market.