From raw ideas to success

To succeed, we should implement innovative engineering ideas from smart people in our organizations. Unfortunately, statistics show that stupidity is winning, says Doug Hall, founder and CEO of Eureka! Ranch. Hall cites a Journal of Marketing Research study that reflects an overwhelming rate of innovation failures.

10/01/2006


To succeed, we should implement innovative engineering ideas from smart people in our organizations. Unfortunately, statistics show that stupidity is winning, says Doug Hall, founder and CEO of Eureka! Ranch. Hall cites a Journal of Marketing Research study that reflects an overwhelming rate of innovation failures.

Of 3,000 raw ideas, 300 resulted in written ideas, the study said, which translated into 125 projects, 17 development efforts, and 1.7 new product introductions of which 1.0 were deemed successful. This amounted to a 0.03% success rate. Humanity's power to create ideas is immense; systems to turn them into reality are failing, Hall contends. As keynote speaker at the International Manufacturing Technology Show (IMTS) last month in Chicago, he repeated Dr. W. Edward Deming's assertion that 94% failures are caused by systems and 6% by workers.

“Engineering innovation and marketing success are not random,” says Hall. “You can meaningfully increase your odds for success. The biggest problem is that we’re working too hard and not using the right tools and knowledge.” Here's how Hall says we should beat the odds.

  1. Read and study to gain more knowledge to grow your creativity. For the vast majority of adults, more input is the best way to get more creative, better than if you practiced thinking flexibly or connected with creative people, he says.

  2. Focusing on what people will need is 10 times more predictive of success than listening to what they say they want (rearview mirror approach).

  3. Product performance and quality are more than nine times as important as pricing or sales support in industrial marketing.

  4. The smartest way to grow sales significantly is to find new customers. If you’re spending more time and effort to build loyalty, you’re playing not to lose. New markets and brands are 2.6 times more profitable than existing customers (who often get deals to stay).

  5. To win with new ideas, you need lead involvement from marketing, R&D, creative development, operations, and production.

  6. Breakthroughs take time to develop and recognize. Don't give up too early. Based on data from more than 30 mega-innovations (cars, color TVs, VCRs) over 100 years, Hall says it takes an average of six years for a breakthrough to take off. Even Apple iPod took four years to become an “instant” success.

For more on improving product and system design, read this online at www.controleng.com/archive under October 2006.

MHoske@cfemedia.com

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