by Jim Biolos
hen CEO John Pepper recently announced that Procter & Gamble would simplify its product lines and that new product development efforts would focus on "big" opportunities, he reminded us—as if we needed reminding—of the importance of genuine innovation as a key driver of long-term corporate growth.
But truly new products or services, as opposed to your routine line extension, face many an obstacle as they make their way from idea to market acceptance—internal resistance, high financial hurdle rates, debates over strategic implications, resource constraints, and the always present "unknowables" of any new effort. If you’re in charge of this kind of initiative, how can you maximize your chances for success against such odds?
Our review of the latest literature on innovations and conversation with its authors turned up some surprising findings. Contrary to what most think, your role as new-product champion is not that of solitary hero or firebrand with a good idea who battles the rigid forces of the company’s status quo. No, today’s most successful champions of innovation go into battle armed with three skills: (1) an ability to demonstrate, repeatedly and effectively, how a new product embodies a match between the company’s competencies and the realities of the market; (2) a flexibility and adaptability in responding to concerns raised by internal skeptics and potential customers; and (3) a talent for building support across a range of corporate constituencies. If this sounds political, it is, in the best sense—putting forward ideas, marshalling support, managing relationships to achieve a collective good.
In practice what does this look like? We’ve identified six key steps.
1 Involve senior management early. . . then manage their distance from the project
In the research for their book, Leading Product Development, HBS professors Steven Wheelwright and Kim Clark found that senior managers typically get involved with new product initiatives just at the point when they can be least helpful: toward the very end of the process, when most of the major strategy and resource decisions are about as easy to change as a flat tire on a moving truck.
Wheelwright and Clark suggest that instead, you should bring senior management in at the earliest stages to play four important roles: as team launcher, helping establish the business charter for your project and ensuring that the right people are engaged in the effort; as energy source, driving support for the project through the organization, validating the importance of the innovation; as commitment manager, ensuring that once the project is on its way, the resources promised by management will be made available to you; and as sponsor/coach, providing counsel to you and your team as needed, and communicating its view of how the project is going.
As a model, Wheelwright and Clark cite how Kodak developed its single-use, or "disposable" cameras. Senior management recognized the pressing strategic need to compete with Fuji in this segment, but also recognized that Kodak wasn’t organized for the effort. So it rallied behind the initiative and took ownership of it, reorganizing the camera unit, identifying key team members, and creating the environment for cross-functional teams—a radical departure from Kodak’s traditional approach to product development. While the tremendous success of this line of products isn’t totally attributable to senior management, the early involvement and support of Kodak’s executive team gave the innovation the validation, sense of strategic importance, and room for experimentation that it needed to succeed.
Ironically, once your project moves toward greater definition, you, as project champion, will probably find it advisable to keep senior management at arm’s length—to avoid having every tactic scrutinized, every decision questioned. But obviously you shouldn’t keep it in the dark, either. To achieve the requisite balance, try to build formal meetings with senior management into your project plan at strategically important points, or milestones, where you will bring it up to date and it will share its thoughts with you.
2 Build the unknowable into your plan
Despite your best efforts to convince yourself, or others, to the contrary, no one can tell you how well your new product or service will fare until customers plunk down the cash. So, your innovation process must take into account a series of unknowables.
In his book, Complexity and Creativity in Organizations, Ralph Stacey, lecturer at the University of Hertfordshire and a heavy-duty conceptualizer, urges champions not to plan a development process that’s too highly structured, especially at the front end. If the future is unknowable, then an innovation effort needs to be flexible enough to adapt to unforeseeable events. The more you build certainty into your plan, the greater the risk that your new product development effort will be driven by the plan you created, rather than by the facts and knowledge you learn along the way. After all, you are doing something new—don’t undermine that by applying the same old model to new opportunities that require flexible new models for success.
Stacey is long on provocative ideas, but short on practical evidence. Fortunately, Dorothy Leonard-Barton’s newest book, Wellsprings of Knowledge, provides some nice real-world examples that help drive Stacey’s point home. Leonard-Barton, a professor at Harvard Business School, calls this kind of flexibility in the innovation process "strategic improvisation" and points to Corning, Hewlett-Packard, and Intel as companies that have benefited from it. In Intel’s case, a joint product development effort with Busicom calculators—remember them?—helped lead to Intel’s strategic shift from DRAM to microprocessors.
Leonard-Barton observes, that building in the unknowable can also lead to "intelligent failure," where an innovation effort terminates, not because it was a terrible idea to begin with, nor because a good idea was thrown out before it ever got a chance to succeed, but because the innovation had legitimate potential for success and was taken to a point where it became clear that the idea was not satisfying customer needs or the company’s requirements for a viable new business. Intelligent failures add to organizational learning and are good indicators that the company is taking some risks—two vital conditions for successful innovation.
But don’t confuse building in the unknowable with being completely ad hoc. Even risky endeavors need some structure, and senior management should require it. Plan for milestones. Analyze your development plan and identify the four or five points where you will have gathered sufficient information—from the market, or other sources—to evaluate the project anew.
Judy Lewent, CFO at Merck, calls these checkpoints strategic options. At these junctures, you need to ask, "Do we have enough evidence to suggest that the new product is moving along a track toward success, or has our work surfaced some inherent problems and obstacles that need to be addressed?" If the answer is the latter, be prepared to walk away from the idea, or to convince senior management to take a new tack. If, on the other hand, you smell success, the organization will want to "buy an option"—that is, commit the resources—to move on to the next stage.
Remember, at these key junctures, you need once again to bring in senior management and other stakeholders for their feedback. This will renew and reconfirm their support for the project.
3 Prototype, prototype, prototype
Don’t go with your single best shot. Wellsprings of Knowledge demonstrates that multiple prototypes generally result in both a more successful and a more efficient product development process. According to Leonard-Barton, prototyping does three important things: (1) It enables customers to react to something concrete during research phase, rather than to an abstract description. You’re likely to get more specific feedback, like "That’s great, but it’d be better if you could put the button on the side, instead of in front." (2) Prototypes will help you understand the processes and resources that will be required to make the new offering. Too many times, a product idea looks great on paper, until manufacturing actually tries to build it or customer service goes out to support it. (3) Having a prototype in their hot little hands will help senior managers truly evaluate its fit with the company’s strategy, values, and competencies.
Leonard-Barton describes how Thermos Co. developed its line of electric grills. Rather than make assumptions about customer needs, the Thermos Lifestyle team created two prototypes, one that emphasized design but didn’t function, and another that was fully functional, but had little design to it. The team found out, through customer reactions, what design elements and functions were important. This enabled them to go straight into production with the new product. Developing a single prototype, with both design and functionality, would have taken Thermos six months longer and, arguably, may not have provided it with enough specific feedback on either dimension.
4 Involve the customer early and often
You know you should; too many don’t. How many failed new products have you seen where the backers mouthed all the right words about their idea being "market driven," but further inquiry revealed that the team had never actually spoken to a customer? Or that after speaking to them, the innovator ignored their concerns.
This step is, arguably, the most important part of an innovation process, but it is also the most threatening to the champion. When you ask your target customer’s opinion about your innovation, you need to be ready to hear the worst—"That’s a really uhhgleee baby. I would never consider buying one."—and then to revise your plans accordingly.
5 Get facilitation and communications help
In an interview, Leonard-Barton argues that, "some development processes may be too complex for one person to be both the facilitator of the process and leader of the discussions and decisions about the business." She suggests that particularly when deliberations are becoming acrimonious, product champions bring in an individual—ideally, someone who is perceived to be neutral—who can help facilitate team meetings. He or she should also make sure you are communicating with the right constituents at the right points in the process, and in general should provide another level of support not necessarily to the product under development, but to the smooth running of the overall effort. Look to the HR department for such an individual, or to a consultant. If you can find someone with an expertise in new product development, even better.
In their latest book, Battling the Barriers to Success, consultants Joan Klubnik and Marlene Roschelle define communications not as your ability to talk effectively to your team, but as an array of strategies to help other managers and staff take ownership of an initiative. The authors offer a guide to the communications problems that a new initiative typically faces.
Remember, they stress, to include in your deliberations all the people who need to be informed of the progress of your project—common sense, again, but too often neglected by new product zealots. If possible, name someone on your team as the "sensitivity manager," to develop the list of people inside and outside your organization who need to know what you’re up to. Listen hard, Klubnik and Roschelle counsel, for the camps of resistance, and then address them tactfully and productively. Bear in mind, the resistance may come not from those with formal decision-making power, but from those whose authority is informal, but no less effective.
And make sure that the members of your team share the same assumptions about what an effective meeting is, and that they agree on what constitutes appropriate conduct in meetings. Spare yourself the cries, "We’ve had too many meetings where nothing gets accomplished."
6 Conduct a thorough debriefing on the process when finished
David Garvin, HBS professor and one of the thought leaders on the "learning organization," sees successful initiatives, including new product innovations, as a series of learning activities, where teams need to learn before beginning a major initiative, learn while doing the work, and maybe most important, learn after the process is completed. In his recent video series, Putting the Learning Organization to Work, he recounts how, after each major exercise, the U.S. Army conducts a thorough debriefing—identifying what went well, what didn’t, and distilling the key lessons. Such a review, which should take place as soon after the completion of the process as possible, will not only help you avoid repeating mistakes, it will also point the way to doing the right things all over again, but doing them even better next time.
Incorporating these six steps into your innovation process can’t eliminate all the uncertainties you face, but it can minimize those uncertainties and improve your chances for success
hen CEO John Pepper recently announced that Procter & Gamble would simplify its product lines and that new product development efforts would focus on "big" opportunities, he reminded us—as if we needed reminding—of the importance of genuine innovation as a key driver of long-term corporate growth.
But truly new products or services, as opposed to your routine line extension, face many an obstacle as they make their way from idea to market acceptance—internal resistance, high financial hurdle rates, debates over strategic implications, resource constraints, and the always present "unknowables" of any new effort. If you’re in charge of this kind of initiative, how can you maximize your chances for success against such odds?
Our review of the latest literature on innovations and conversation with its authors turned up some surprising findings. Contrary to what most think, your role as new-product champion is not that of solitary hero or firebrand with a good idea who battles the rigid forces of the company’s status quo. No, today’s most successful champions of innovation go into battle armed with three skills: (1) an ability to demonstrate, repeatedly and effectively, how a new product embodies a match between the company’s competencies and the realities of the market; (2) a flexibility and adaptability in responding to concerns raised by internal skeptics and potential customers; and (3) a talent for building support across a range of corporate constituencies. If this sounds political, it is, in the best sense—putting forward ideas, marshalling support, managing relationships to achieve a collective good.
In practice what does this look like? We’ve identified six key steps.
1 Involve senior management early. . . then manage their distance from the project
In the research for their book, Leading Product Development, HBS professors Steven Wheelwright and Kim Clark found that senior managers typically get involved with new product initiatives just at the point when they can be least helpful: toward the very end of the process, when most of the major strategy and resource decisions are about as easy to change as a flat tire on a moving truck.
Wheelwright and Clark suggest that instead, you should bring senior management in at the earliest stages to play four important roles: as team launcher, helping establish the business charter for your project and ensuring that the right people are engaged in the effort; as energy source, driving support for the project through the organization, validating the importance of the innovation; as commitment manager, ensuring that once the project is on its way, the resources promised by management will be made available to you; and as sponsor/coach, providing counsel to you and your team as needed, and communicating its view of how the project is going.
As a model, Wheelwright and Clark cite how Kodak developed its single-use, or "disposable" cameras. Senior management recognized the pressing strategic need to compete with Fuji in this segment, but also recognized that Kodak wasn’t organized for the effort. So it rallied behind the initiative and took ownership of it, reorganizing the camera unit, identifying key team members, and creating the environment for cross-functional teams—a radical departure from Kodak’s traditional approach to product development. While the tremendous success of this line of products isn’t totally attributable to senior management, the early involvement and support of Kodak’s executive team gave the innovation the validation, sense of strategic importance, and room for experimentation that it needed to succeed.
Ironically, once your project moves toward greater definition, you, as project champion, will probably find it advisable to keep senior management at arm’s length—to avoid having every tactic scrutinized, every decision questioned. But obviously you shouldn’t keep it in the dark, either. To achieve the requisite balance, try to build formal meetings with senior management into your project plan at strategically important points, or milestones, where you will bring it up to date and it will share its thoughts with you.
2 Build the unknowable into your plan
Despite your best efforts to convince yourself, or others, to the contrary, no one can tell you how well your new product or service will fare until customers plunk down the cash. So, your innovation process must take into account a series of unknowables.
In his book, Complexity and Creativity in Organizations, Ralph Stacey, lecturer at the University of Hertfordshire and a heavy-duty conceptualizer, urges champions not to plan a development process that’s too highly structured, especially at the front end. If the future is unknowable, then an innovation effort needs to be flexible enough to adapt to unforeseeable events. The more you build certainty into your plan, the greater the risk that your new product development effort will be driven by the plan you created, rather than by the facts and knowledge you learn along the way. After all, you are doing something new—don’t undermine that by applying the same old model to new opportunities that require flexible new models for success.
Stacey is long on provocative ideas, but short on practical evidence. Fortunately, Dorothy Leonard-Barton’s newest book, Wellsprings of Knowledge, provides some nice real-world examples that help drive Stacey’s point home. Leonard-Barton, a professor at Harvard Business School, calls this kind of flexibility in the innovation process "strategic improvisation" and points to Corning, Hewlett-Packard, and Intel as companies that have benefited from it. In Intel’s case, a joint product development effort with Busicom calculators—remember them?—helped lead to Intel’s strategic shift from DRAM to microprocessors.
Leonard-Barton observes, that building in the unknowable can also lead to "intelligent failure," where an innovation effort terminates, not because it was a terrible idea to begin with, nor because a good idea was thrown out before it ever got a chance to succeed, but because the innovation had legitimate potential for success and was taken to a point where it became clear that the idea was not satisfying customer needs or the company’s requirements for a viable new business. Intelligent failures add to organizational learning and are good indicators that the company is taking some risks—two vital conditions for successful innovation.
But don’t confuse building in the unknowable with being completely ad hoc. Even risky endeavors need some structure, and senior management should require it. Plan for milestones. Analyze your development plan and identify the four or five points where you will have gathered sufficient information—from the market, or other sources—to evaluate the project anew.
Judy Lewent, CFO at Merck, calls these checkpoints strategic options. At these junctures, you need to ask, "Do we have enough evidence to suggest that the new product is moving along a track toward success, or has our work surfaced some inherent problems and obstacles that need to be addressed?" If the answer is the latter, be prepared to walk away from the idea, or to convince senior management to take a new tack. If, on the other hand, you smell success, the organization will want to "buy an option"—that is, commit the resources—to move on to the next stage.
Remember, at these key junctures, you need once again to bring in senior management and other stakeholders for their feedback. This will renew and reconfirm their support for the project.
3 Prototype, prototype, prototype
Don’t go with your single best shot. Wellsprings of Knowledge demonstrates that multiple prototypes generally result in both a more successful and a more efficient product development process. According to Leonard-Barton, prototyping does three important things: (1) It enables customers to react to something concrete during research phase, rather than to an abstract description. You’re likely to get more specific feedback, like "That’s great, but it’d be better if you could put the button on the side, instead of in front." (2) Prototypes will help you understand the processes and resources that will be required to make the new offering. Too many times, a product idea looks great on paper, until manufacturing actually tries to build it or customer service goes out to support it. (3) Having a prototype in their hot little hands will help senior managers truly evaluate its fit with the company’s strategy, values, and competencies.
Leonard-Barton describes how Thermos Co. developed its line of electric grills. Rather than make assumptions about customer needs, the Thermos Lifestyle team created two prototypes, one that emphasized design but didn’t function, and another that was fully functional, but had little design to it. The team found out, through customer reactions, what design elements and functions were important. This enabled them to go straight into production with the new product. Developing a single prototype, with both design and functionality, would have taken Thermos six months longer and, arguably, may not have provided it with enough specific feedback on either dimension.
4 Involve the customer early and often
You know you should; too many don’t. How many failed new products have you seen where the backers mouthed all the right words about their idea being "market driven," but further inquiry revealed that the team had never actually spoken to a customer? Or that after speaking to them, the innovator ignored their concerns.
This step is, arguably, the most important part of an innovation process, but it is also the most threatening to the champion. When you ask your target customer’s opinion about your innovation, you need to be ready to hear the worst—"That’s a really uhhgleee baby. I would never consider buying one."—and then to revise your plans accordingly.
5 Get facilitation and communications help
In an interview, Leonard-Barton argues that, "some development processes may be too complex for one person to be both the facilitator of the process and leader of the discussions and decisions about the business." She suggests that particularly when deliberations are becoming acrimonious, product champions bring in an individual—ideally, someone who is perceived to be neutral—who can help facilitate team meetings. He or she should also make sure you are communicating with the right constituents at the right points in the process, and in general should provide another level of support not necessarily to the product under development, but to the smooth running of the overall effort. Look to the HR department for such an individual, or to a consultant. If you can find someone with an expertise in new product development, even better.
In their latest book, Battling the Barriers to Success, consultants Joan Klubnik and Marlene Roschelle define communications not as your ability to talk effectively to your team, but as an array of strategies to help other managers and staff take ownership of an initiative. The authors offer a guide to the communications problems that a new initiative typically faces.
Remember, they stress, to include in your deliberations all the people who need to be informed of the progress of your project—common sense, again, but too often neglected by new product zealots. If possible, name someone on your team as the "sensitivity manager," to develop the list of people inside and outside your organization who need to know what you’re up to. Listen hard, Klubnik and Roschelle counsel, for the camps of resistance, and then address them tactfully and productively. Bear in mind, the resistance may come not from those with formal decision-making power, but from those whose authority is informal, but no less effective.
And make sure that the members of your team share the same assumptions about what an effective meeting is, and that they agree on what constitutes appropriate conduct in meetings. Spare yourself the cries, "We’ve had too many meetings where nothing gets accomplished."
6 Conduct a thorough debriefing on the process when finished
David Garvin, HBS professor and one of the thought leaders on the "learning organization," sees successful initiatives, including new product innovations, as a series of learning activities, where teams need to learn before beginning a major initiative, learn while doing the work, and maybe most important, learn after the process is completed. In his recent video series, Putting the Learning Organization to Work, he recounts how, after each major exercise, the U.S. Army conducts a thorough debriefing—identifying what went well, what didn’t, and distilling the key lessons. Such a review, which should take place as soon after the completion of the process as possible, will not only help you avoid repeating mistakes, it will also point the way to doing the right things all over again, but doing them even better next time.
Incorporating these six steps into your innovation process can’t eliminate all the uncertainties you face, but it can minimize those uncertainties and improve your chances for success
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