Designers are proud of their ability to innovate, to think outside the box, to develop creative, powerful ideas for their clients. Sometimes these ideas win design prizes. However, the rate at which these ideas achieve commercial success is low. Many of the ideas die within the companies, never becoming a product. Among those that become products, a good number never reach commercial success.
Why would brilliant ideas fail in the marketplace? The reasons are complex. Part of the problem is that design consultancies are outsiders, hired by one division of the company, but not necessarily accepted by the other divisions. A product, however, requires the support of the entire company: design and development, engineering and marketing, sales and service, supply chain and distribution chain. Products enter into a complex eco-system, both within and outside of the company. Successful products have to navigate a complex path. The idea and initial design is only one piece of the story.
Design companies—and all consulting companies—do the fun part of the job. They waltz in, are given an assignment, go away and think, play, experiment, and ponder. They are free to break the rules, free to invent and tinker without the restrictions of corporate purchasing polices and interdepartmental politics. But in the end, when the brilliant new ideas have been laid out, prototyped, PowerPointed, memoed, and white-papered, they still have to get accepted by the rest of the company. This is where the hard part begins, but it is also precisely where the contract often ends. The designers leave and wonder what is happening within the company. In some cases, phone calls and emails don't get answered. In other cases, the contact person within the company voices frustration at the difficulties involved in moving forward. The rumor mill flourishes. Eventually the product either is presumed dead or something does indeed appear on the market, sometimes in a form barely recognizable by the design team. The designers (and all consultants, for that matter) are left to write share brilliant thoughts for the trade magazines, the Harvard Business Review, or convention talks, disguising the company names, of course.
Great Ideas Are Not Sufficient
Why do these ideas often fail to take hold with the people, companies, and organizations they were meant to transform? The same phenomenon holds not only for the recommendations of design and business consultancies but even for internally generated ideas from the research, planning, and strategy parts of the company. This is a problem that has long bothered me. I used to run Apple's Advanced Technology Group. Many of our ideas were ignored. It took considerable interaction with the product groups, hours of sitting in on meetings, of working with their engineers and marketing teams to get acceptance.
In many cases, the rejections were sensible. Then the problem was to educate the research team about the true needs of the product groups. This direction, I must confess, usually failed. The research community is remarkably ignorant about the world of business, often deliberately so. (See my essays on the research-practice gap.)
Ideas are just the starting point toward product realization. New product ideas have to fit the competencies of the corporation. They have to fit within the existing family or products, or at least the product strategy. The purchasers of new products have to be prepared. The costs must be contained. The technology must be up to it. The same people who the new ideas are intended to supplant and go around are now responsible for executing the ideas. No wonder so many good ideas fail.
Why Skunkworks Are Not the Answer
Consider the case of skunkworks teams. These are special company teams asked to innovate, free from normal bureaucratic restrictions. Wikipedia defines a skunkworks as "a group within an organization given a high degree of autonomy and unhampered by bureaucracy, tasked with working on advanced or secret projects."
Business professors love to use Lockheed Corporation's skunkworks team as an example of how a company can successfully innovate. The Lockheed team designed a number of successful military and spy planes. The lesson, we are often told, is that small startups are where innovation flourishes, so if a large corporation wants to innovate, it needs to mimic a startup, establishing small groups who can go off in isolation unhampered by committee reviews and autocratic rules that stifle innovation, slow up the necessary rapid purchases of essential items, and impose long, drawn-out committee reviews at every step along the way. "Get out of our way," say the teams. "Let us be isolated, hoist the pirate skull-and-crossbones flag of freedom from bureaucracy, and you will get great results." Alas, these teams invariably do great innovative work that then fails to get incorporated into the company's product lines.
Skunkwork teams are like independent consultancies: they can do great work, but then they have the same trouble integrating their ideas with the needs, resources, talents, and political structure of the organization. Actually, they may have even more difficulty, for these are company employees who deliberately thumbed their noses at company procedures and processes. The Lockheed skunkworks was a special case because they only manufactured a small number of items for each project, usually handmade by the team itself. But when the idea has to become integrated as a mainstream product that has to be integrated back into the companies business, problems arise. Ideas either go nowhere or get badly transformed. Not all skunkwork projects fail to be accepted by the company. In my experience, however, the successes are all special cases with extenuating circumstances.
Creativity requires breaking out of the mold, distancing the team from the corporate structure. Successful products and services require acceptance and buy-in from the corporate structure. These demands conflict. It is not enough to have great ideas: they ideas have to fit within the framework of the company and of the people who will ultimately purchase and use them. It is very difficult for a team to flaunt the company, brag that they are superior because they do not need to follow the rules, but then get successfully reabsorbed back into the company as heroes delivering a brilliant product. Just as the team rejected the company by staying outside; the company then rejects their ideas when they come back home.
Making Innovation Succeed
Creative ideas are never sufficient. After the fun part of creativity comes the difficult, dull, painstaking efforts to make those ideas fit the true needs of the organization and the customers, to make sure they are practical, implementable, cost-efficient, and profitable. These practical, hard-headed business and marketing issues are just as important as the creative side, conceivably even more important. In fact, most of the value of innovation comes from small, incremental change, not massive, paradigm-shifting change, in part because these enhancive the market size and efficiency of the operations, but also because they are readily accepted by the organization.
Most innovations are simple enhancements of products, enhancements in supply chains, in manufacturing, packaging, marketing, and distribution. These small, incremental innovations are not as much fun to invent as the groundbreaking, revolutionary new product concept, but they add far more value. These innovations build on existing products. They refine the designs and manufacturing process to lower costs, enhance the user base, and expand the marketing and distribution. This is true whether the product be hardware, software or service. Moreover, small, local innovations are much more readily integrated into the product process than larger, more radical change. (See Larry Kelley's videos and writings.)
Creative, paradigm changes are essential. But think about your own life. How many truly revolutionary changes have you experienced? And how long did each one take to become established? The number of truly revolutionary ideas is surprisingly small, perhaps just a few a year. The really revolutionary ones then took decades to become accepted.
Innovation only succeeds when all the stars are aligned. The company has to have complete buy-in. The technology must be ready: inexpensive, robust, and effective. The supporting infrastructure must be in place. And the customer base must have already had sufficient exposure that they are willing to buy. Put all these together plus the funds and patience to wait the decade it takes for market size to become reasonable and you have an instant success.
Is it any wonder that most startup companies fail, that most novel ideas don't take root in established companies, and that most radical ideas do come from startups that are willing to accept small market share for long periods?
How is a design firm to cope? Here it is necessary to recognize the limitations of an outside consultancy. It is essential to get buy in from the entire company, which means insisting upon representatives from key constituencies across the entire product cycle as part of the process from day one. The period of the contract must extend through the entire product process to bridge the gaps across company divisions. Realize that the idea alone is not enough: it has to fit the business, the people, the customers, and the times. An idea that is ahead of its time is perhaps even worse than one that is behind the times. If ahead, the product may die. If behind, it can catch up, learning from the mistakes of competitors.
A year ago, writing in Interactions, the magazine of the human-computer interaction community, I put it this way: "A successful product or service has to navigate a complex terrain of hurdles, constraints, technologies, and opportunities. There are myriad market forces, fundamental needs, competitive strategies, core competencies, and market adoption forces. And the product must deliver its promises, not only functioning well, but also providing pleasure in the interaction." No product is an island: Great ideas are necessary, but not sufficient.