If you follow trends in the innovation and new product development space, you’ve probably noticed that the fuzzy front-end seems to get the most press. And why wouldn’t it? Ideation, collaborating, and brainstorming new ideas to launch your company’s “next big thing” allows us to be creative and have fun — and besides, it’s invigorating to think outside the box! However, it’s crucial to still deal with the nitty-gritty and get down to the business of killing projects before they have a chance to ruin your portfolio.
But there’s a darker side to ideation. Many of these so-called great ideas end up being complete duds in the marketplace. Unfortunately, people have pet projects, or build emotional attachments to their ideas. This propels them to force their “breakthrough” further down the gated process than it should. Without the proper vetting and courage to kill lower value innovations, these ideas can suck money and resources faster than a shop vac. Worse yet, what we call “zombie projects” can slowly drain the life out of your development team until the project is on life support.
And the result? As those lackluster projects eat up time and money, the ideas with true profitability potential lack the resources and support to make it to market and actually deliver revenue.
If you want to experience the fruits of your labor and see tremendous ROI on your projects, you must be able to accurately and objectively assess the merits of each idea as early in the funnel as possible. Only then will you be able to know which of those bad apples needs to be tossed out. Killed. Put out of its misery. Justifiable murder. These projects are like weeds in your garden. If you don’t annihilate them now, they have the potential to ruin your entire portfolio.
Live and Let Die
One Planview customer shared, “If we can kill a product just one gate earlier, we save over one million dollars.” With each gate a mediocre idea passes through, it’s wasting time along with money and resources that could be working on those ideas with much greater potential to shine and achieve your revenue targets. Your phase gates should have the biggest, baddest bouncer standing in front of them, vetting each project before it gets past the velvet rope. And not only should that idea be able pass muster standing on its own two feet, it also needs to make sense in context of the greater portfolio.
Knowing which projects are worthy of investment is about having the right strategy and being able to leverage powerful portfolio criteria to determine which ideas are winners and which ones aren’t viable in the context of your portfolio objectives. If your objective is incremental growth and being a fast follower (i.e. let someone else incur the cost of R&D and you leverage it to make something comparable or better), then your strategy is to keep costs low but be fast to market. Conversely, if you’re looking for that next big, disruptive innovation, you might be keener to allow some of the pie-in-the-sky ideas to eat up some resources.
You need a visible strategy. And you also need portfolio strategy that clearly point to the projects you keep and the projects you kill.
Do I have your attention? I encourage you to take a look at this fantastic resource, “Open the Innovation Floodgates” to learn how to know when to move forward and when killing projects is necessary.
I’d like to hear from you. What is your current process for killing a lower value projects earlier in the commercialization process? Share by leaving a comment below.