The Most Common Innovation Project Failures

The problem isn’t bad ideas; it’s bad management

Published: Thursday, October 15, 2015 - 12:59

I recently had the opportunity to speak to a leadership team that is considering building an innovation capability in their business. I was asked a question I get infrequently, but one I always enjoy answering. The question is this: “What keeps businesses from innovating effectively?”

The answer that I think most leadership teams want is, “Good ideas.” After all, it’s easier to explain away the lack of innovation if you can say that most teams lack good ideas. A lack of good ideas, however, is almost never the appropriate response to the question. Most companies teem with reasonably good ideas, and in some cases great ideas. No, the reasons that corporate innovation fails are many and varied, almost as differentiated as the number of industries and business models and management styles that are in evidence.

With that said, there are a number of factors that severely curtail successful innovation in corporations. These factors include:
• Failure to adequately define a customer need or business opportunity before deciding to innovate
• Failure to place the right people on an innovation task and provide them the tools and skills to succeed
• Failure to define what the word “innovation” means, as well as the type of outcome expected: incremental or disruptive; product, service, or business model
• Failure to encourage any divergent thinking, allowing the innovation teams to quickly converge around ideas that resemble existing products and services
• Failure to allow time for discovery and exploration, which forces innovation teams to worry about the amount of time they invest in learning new things
• Failure to understand the customers’ needs and expectations, substituting what internal employees believe that customers want
• Failure to provide the innovation teams with the appropriate compensation and reward models, and dividing their time between important innovation activities and urgent everyday business
• Failure to think through how to transition a good idea (if one can emerge from such a poorly defined process) to a product or service development and commercial launch

These factors occur and recur in almost every innovation activity I’ve ever seen. Note that they have very little to do with “good ideas” and almost everything to do with management commitment, definition, resource allocation, and other things that executives and managers are supposed to do well, regardless of the setting.

Most innovation is far too poorly defined and scoped, faces far too much pressure to move quickly and narrow its focus, rarely engages with markets or customers to discover new needs or expectations, and actually encourages a divisive setting for team members, where people with passion for new ideas fight for oxygen and momentum with people who are on the team because they were assigned to it, who have no comfort doing work they aren’t prepared to do, and aren’t compensated or rewarded to do well.

Oh, you’ll say, what if we actually do all of these things well, and the ideas aren’t all that good after all? What if it really is an issue of bad ideas rather than the culture and definition and management? My response is that most companies have tried innovation without addressing any, or even some, of the items I’ve identified. I suspect (in fact I know) that if we can engage good people in the right setting with the right context, good ideas will flow. 

First published Aug. 31, 2015, on the Innovate on Purpose blog.

About The Author

Jeffrey Phillips

Jeffrey Phillips is the lead innovation consultant for OVO, which offers assessments, consulting, training and team definition, change management, innovation workshops, and idea generation space and services. Phillips has led innovation projects in the United States, Western Europe, South Africa, Latin American, Malaysia, Dubai, and Turkey. He has expertise in the entire “front end of innovation” with specific focus on trend spotting and scenario planning, obtaining customer insights, defining an innovation process, and open innovation. He’s the author of Relentless Innovation (McGraw-Hill, 2011), and 20 Mistakes Innovators Make (Amazon Digital Services, 2013), and co-author of OutManeuver: OutThink—Don’t OutSpend (Xlibris, 2016).