Learning from Innovation: Failure Not Required

One of the mantras of Lean Startup is to “fail fast” when talking about innovation, but I think it misses the point. Thomas Edison famously said, “I have not failed. I have just found 10,000 ways it won’t work.” The reason to pursue innovation for your business is not about failing, it’s about learning – learning what your customers don’t want alongside what they need, learning about the market for your solution, and learning what your organization is capable of. So from here on out I’m going to change the innovation mantra to “learn fast”.

 

Failing Fast

Let’s say team A is part of a group of car dealerships and their CEO has given them a charter: build a new way for customers to buy cars. Success for this team means deployment of a car buying solution that increases car sales.

They start out by talking to customers – what would they like to see in a car buying solution? They find that customers want to research cars online and get recommendations similar to the products they buy on Amazon. So they build an online marketplace for their group of car dealerships that provides links to research on the cars they have for sale, and a way for customers to review their purchases. They test the solution with their customers who say, “cool, this just what I asked for!” So they deploy it and six months later … nothing. They get a lot of customers visiting their online market, but sales in their dealerships have not increased. And while the CEO got the solution he asked for, it didn’t improve his bottom line, so the innovation is seen as a failure.

Learning Fast

Team B doesn’t start their innovation efforts with a solution. Instead, their CEO gives them this charter: learn how to improve the car buying experience to increase purchases. Success for this team is the learning – how can we improve the experience that will change our customer’s behavior?

The team starts by listening to their customer’s stories about car buying. What did they enjoy? What was missing? These stories build a customer journey map that captures the highs and lows of their current journey. The team also steps back from their assumption that the customer’s goal in this journey is to buy a car. They discover the underlying reasons consumers start to shop – their family is growing, their current car is getting old, they want to reduce their gas usage, etc. And they find that the bigger issue is deciding what car to buy, what is out there that can meet their needs. They can test this hypothesis with customers – if we helped you find the right car to meet your specific needs, would you buy from us? If the customer says yes, the team can get to the next layer – what kind of help do you need? They can build prototypes and test and refine, until they can confidently go back to the CEO with the results of their innovation project: if we build this solution, we can change these types of customers’ behavior to buy from us.

This may seem like a small shift, but if you give your innovation team the charter to learn from testing their ideas instead of building solutions, you’ll be surprised at the difference in their outcomes. I do this a lot with the innovation teams I work with. When they start talking about their plans for the solutions they’ll build, I ask them what hypothesis they are testing, what problem they are solving. They resist, often because they’re already married to the solution. To make this easier, avoid presenting your team with a solution and asking them to test it with customers. Instead, you need to present them with an outcome and ask them to provide a solution that achieves that outcome, along with measures that will prove they achieved the outcome.

Takeaway Tips

Here are some tips for learning from innovation efforts:

  • Borrowing from design, establish goals using the “How Might We …” framing: How Might We help our customers <description of their task> so that they can <description of something they want to start or stop doing>
  • Establish measures based on your learning outcomes. This could be the number of customers who tested your hypothesis or surveys that establish whether your product had the desired effect on your customer’s behavior.
  • Test how much your innovations can leverage your current capabilities in technology, processes, people, branding, etc. These learnings will help you establish the effort for implementation.
  • Make prototyping and iteration a part of how you innovate, the goal of each iteration to test whether the prototype has the right features to provide a complete solution for your customer

Where are you getting in the way of innovation in your business? If you’re not sure, let me help you discover and break down those barriers.

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