The art of killing innovations: knowing when to quit.
In today’s fast-paced business world, innovation is often considered the number one key to success. Companies invest significant amounts of resources in launching new initiatives, products, and services to stay ahead of their competition. In this blog, we will give 3 reasons so you know when to quit and save your company from innovation failure.
Starting is easier than stopping.
When we look around us, we see numerous companies that heavily invest in innovation to sustain their business growth. Large amounts of time, money, and resources go into launching new initiatives, products, and services to stay ahead of their competition. Your organization is probably doing the same.
What is often overlooked is the art of ending projects that no longer add value. Killing an innovation project can be challenging, as the excitement of starting something new is often stronger than the desire to critically evaluate a project. An honest evaluation, however, is what’s crucial to keep your company relevant and future-proof.
Here’s how to know when to quit and save your company from innovation failure.
3 reasons why innovations fail.
1. Lack of vision and strategy.
Only a clear vision and strategy empower your teams to drive innovation in the right direction. Do you have a strong innovation strategy? That’s great. But make sure to share this vision with your teams so everyone understands the purpose, objectives, and desired outcomes of your innovation project.
2. Resistance to change and fear of failure.
Resistance to change and fear of failure can hinder progress. That is why it is important to create a culture where people feel safe to share new ideas, experiment, make mistakes and learn from them. Open communication, collaboration, and continuous learning throughout the organization are key.
3. Not enough resources.
Innovation projects require lots of resources to succeed. We are not just talking about money but also about time and talent. A lack of resources can undermine the potential of any innovation initiative. That is why it is essential to prioritize innovation within your organization’s resource allocation process. Allocate budgets, establish cross-functional teams, and provide the necessary tools and training to support innovation efforts.
Addressing the lack of a clear vision and strategy, overcoming resistance to change, and ensuring sufficient resources and support, helps you mitigate the risks of innovation failure and pave the way for transformative success.
Failure is simply the opportunity to begin again, this time more intelligently. — Henry Ford.
Still, the question remains: when is it time to kill a project? We use the following 3 metrics as a guideline:
Desirability.
Ask yourself: how big is my potential customer base for this product or service? Are my customers willing to pay for it? And how much? Guessing is not enough. You must do your market research, gather customer feedback and run experiments to validate the customers’ willingness to pay. If your project lacks a large enough customer base or fails to generate revenue potential, that’s a telltale sign for you to consider ending the project right there and then so you can reallocate your resources to more promising endeavors.
Feasibility.
Take a close look at the production infrastructure, supply chain capabilities, and distribution channels required to bring your product or service efficiently to the market. Evaluate whether your company possesses all the capabilities and resources to produce and deliver a scalable solution. If you run into significant limitations that cannot be overcome independently or through strategic partnerships, you might want to kill your project and focus on initiatives that are more feasible — and scalable.
Viability.
Look at the overall market size and growth potential for your innovation project. Assess whether the market is big enough to generate the desired impact for people, planet, and profit. Additionally, analyze the potential profit margins and the revenue the project will be able to generate. If the market is too small, the impact insufficient, or the project’s financial viability weak, end your project and redirect resources to an area where you can achieve a more significant and sustainable impact.
Once you have a clear picture of the desirability, feasibility, and viability of your innovation, you can make an informed decision about the future of your project. Regular evaluations and a readiness to make tough choices will keep your company on its toes: agile, focused, and set up for long-term success.
Keep in mind: quitting takes courage, but it mostly allows you to shift resources, focus on more promising initiatives, and create a culture of adaptability and continuous improvement.
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Originally published at https://www.businessmodelsinc.com.
