Don't Let the Circumstances Outpace Your Assumptions
A front-page article in yesterday’s Wall Street Journal illustrated how important it is to periodically revisit the assumptions behind an idea.
The article described how several years ago, the head of Sacramento’s regional planning agency started to push developers to concentrate growth in defined areas rather than furthering suburban sprawl. The argument hinged on lowering pollution and fostering economic development.
Of course, with the price of oil shooting up, today the idea looks remarkably prescient.
I wonder, however, how many planners rejected similar ideas because they couldn’t imagine people making living decisions based on the cost of commuting, and how many now wish they started dusting off those rejected plans when signals emerged suggesting that circumstances had changed.
On the other hand, sometimes circumstances change in ways that undermine ideas that once seemed credible. Consider Motorola’s daring, and ultimately doomed, venture to provide satellite-driven mobile telephony.
When Motorola started investing in the multi-billion dollar “Iridium” project, competing standards made using mobile telephony in different counties a major headache. I remember when I joined McKinsey & Co. in the mid 1990s how world travelers would carry several mobile phones. Under these conditions, a truly global technology had appeal.
As many markets converged on a standard (Global System for Mobile communications, or GSM) and created roaming agreements, the basic premise behind Iridium crumbled. Motorola continued plowing money into the venture until it was crystal clear that it was a flop.
It’s rare that you come across a universally good or bad idea. Whenever you make a decision about an idea, ask about the three developments that would make you reject the project you just approved or approve the project you just rejected. Periodically revisiting that shortlist will help to properly manage your innovation portfolio.
Can readers think of examples of good "before their time" ideas that might have been killed too soon? I wonder sometimes what would have happened if Apple kept at the Apple Newton for example. Maybe the iPod would have come even sooner.
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Scott D. Anthony is the president of Innosight, an innovation consulting and investing company with offices in Massachusetts, Singapore, and India. He has consulted to Fortune 500 and start-up companies in a wide range of industries. During 2005–2006 he spearheaded a yearlong project to help the newspaper industry grapple with industry transformation (Newspaper Next).
Comments
Government can afford to invest in grand plans and infrastructure that may or may not ever find a relevant need because they don't answer to shareholders, aren't spending their own money, and don't have to make a profit. Business can't work that way, and your examples illustrate that.
Regardless of the need for a single global phone, Iridium was a dead duck from day one. No one was ever going to carry a brick to place $7/minute calls outside of very, very specialized applications (military in the desert, people working on oil platforms in the middle of the ocean). They built a business model around the most expensive infrastructure imaginable, which dictated the price, but no one ever asked how many people would ever spend that much for a luggable phone. I might have liked a PC in the late 1960s, but it would have cost several million dollars, had little more capability than a pocket calculator does today, a mainframe-style operating system and required custom programming of all the software I needed. Things not only have to serve a need, they have to be practical to build.
The Newton is good example of the point above. It didn't have any of Steve Jobs design flair, because Steve wasn't there at the time. It was poorly designed and underpowered and overpriced for its intended use. i.e. it had no market.
Any idea must be right for its time, or it can't serve an unmet or underserved need. Therefore the question of a product that was before its time and killed too soon seems a contradiction.
- Posted by Paul
July 11, 2008 7:18 PM
I think its interesting and its very relevant to my work and the industry in general. I can think of examples where short term thinking created a more expensive proposition. One stark example is the use of dd/mm/yy format to store dates so as to save some precious bytes of data when memory devices were expensive. This resulted in the huge Y2K problem and we all know how expensive it was to sort that out.
However, the interesting aspect is that in creating a solution for the Y2K, we ended up creating the Offshore initiative. This has the potential to be a solution as well as a problem.
So a short term fix led to a larger problem which led to another potential "short term solution" which can create larger problems ad infinitum
- Posted by Prashant
July 29, 2008 11:21 AM
Time for new (good) search engines challenging Google.
See this one, though of narrow interest (scientists), it is becoming fast popular.
www.Vadlo.com
- Posted by Curtis
August 1, 2008 3:37 PM