Посты с тэгом: Postit

The Myth of Serendipitous Innovation

Published date: May 12, 2014 в 3:00 am

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In 1891, a physical education teacher named James Naismith invented the game of basketball when he nailed two ordinary peach baskets to the wall of a gymnasium. His students loved the game. But, there was a problem. Every time a player shot the ball into the basket, somebody had to get up on a ladder and take it out. That wasted a lot of time and it ruined the flow of the game.

But then something happened. After many games, the bottoms of the peach baskets became so weak that they eventually broke off, allowing the basketball to fall straight through.
This simple serendipitous invention allowed the game to be played continuously without interruption, and it gave rise to a global billion-dollar industry we know today as professional basketball.
The game of basketball isn’t the only invention created through pure chance. Many successful products you see around you today are the result of serendipity. The Post-it note, velcro, penicillin, x-rays and even chocolate chip cookies were created by chance.
With so many successful products created through serendipity, it makes you wonder whether companies can rely on it to create breakthrough products. The answer is no. Serendipity, as a method of innovation, has a very poor track record. The number of serendipitous products is a tiny percentage of the total of all products. It just doesn’t yield nearly the amount of blockbuster products as you would think.
So why does it seem there are so many of them? That’s because serendipitous products are more memorable than others. We hear about them in the news media more often. Because of that, we recall more examples of serendipitous products than other inventions. So we’re fooled into thinking they must be occurring at a much higher rate. It just isn’t true.
Instead of having to rely on chance, learn a method that you can use proactively to create new products and services.
Let’s look back at our basketball example. What if James Naismith had used a thinking tool that guided him to remove the bottoms of the peach baskets right from the start? Had he done so, he would have seen the benefit immediately.
We’ll never know for sure. But, what would you rather rely on? Pure chance? Or would you prefer to have a method that leads you to these same inventions in a systematic way?
If you’re serious about innovation, I advise you to go with the odds, not the gods. While serendipitous products are fun to read about, don’t let them distract you from using a systematic approach that will increase your creative output.

The Hidden Cost of Poor Innovation Execution

Published date: February 13, 2012 в 3:00 am

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Executing and launching new products takes financial and human resources.  When poor execution delays a product launch, companies are hit with another cost, one which often goes unnoticed.  Poor execution delays the revenue stream that a new innovation will earn.  Given the time value of money, that financial loss can be staggering. Consider one of the most famous innovative product – the Post-it® Note.

3M scientist, Spencer Silver, invented a note size paper with a weak glue backing. The company saw no market application for it.  One day, Art Fry, another 3M scientist, was singing in the church choir.  Paper bookmarks kept falling out of his hymnal, so he began using the sticky notes instead.  With the weak adhesive, the notes stayed in place, yet lifted off without damaging the pages.  3M began distributing Post-it® Notes in 1980 — ten years after Silver developed the super weak adhesive.  Today, it’s one of the most popular office products available.

What if 3M cut that execution time from 10 years to 5 years?  What is the value of better/faster execution?  Let’s make some simplifying assumptions.  Assume the Post-it® Note franchise turns out $1 billion in annual revenue and nets a profit of $100 million in perpetuity. (3M’s consumer products and office division, which includes Post-it®, posted revenue of $3.47 billion in 2009 according to public financial filings.)  Using a discount rate of 5%, that yields a net present value of $2 billion.  Now what if that cash flow is delayed just five years due to poor execution.  Using the same discount rate of 5%, the new NPV is $1.6 billion, a whopping $400 million in lost cash!

Could 3M have spent money on ways to speed up the launch of the Post-it® Note?  It is certainly plausible.  Investing in market research and other experimentation might have led 3M managers to see the potential of the product sooner.  It certainly would have cost less than the $400 million lost due to slow execution.

Some might argue that execution is more important than creation, but both are necessary to succeed.  Applying systematic methods to create great ideas increases your odds of success.  Great execution is what helps your company realize the full financial value of those inventions.

 

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