You Need to Fail Fast In Order to Successfully Innovate. But What Does That Mean?

Many companies have adopted the language of “failing fast” because they know it’s how successful products get to market. The concept has been touted so frequently by innovation leaders that the phrase may be repeated to encourage speed, without the context of what it looks like in practice.

What is failing? How do you know if you’re failing fast? What should you be failing at?

Entrepreneurs are good at this – they throw prototypes out, listen to customers intently, and adapt on the fly until they get traction. It’s why big companies will invest big dollars into programs that promise to inject entrepreneur-like spirit or ideas into their organization.

By the time an entrepreneur’s idea is big enough to be noticed in the market, though, the hard part is over. The idea came long before the success, and what’s left are reports highlighting what a “good idea” they had. Which leaves many companies thinking that they could have big success, too – if only they had the right idea.

Companies known for their rapid innovation and growth can unknowingly further this notion in interviews or public appearances. “We just try things to see what works,” is a version of the comments made by leading innovators.

They aren’t wrong– they just aren’t explaining the whole process. Companies that “try a bunch of things” typically have other tried and true capabilities in place, along with clear lines for decision making and clear decision-making criteria. And when companies that are trying to grow their innovation capability latch onto these tactics out of context, they don’t get the same results.

What makes innovative companies successful is:

A clearly identified problem to solve.

This is the customer’s problem – not the company’s problem. A frequent mistake companies make when embarking on an innovation journey is trying to solve their own problem, which is almost always wanting more sales. You wanting more sales is not a problem that your customers are likely to latch onto, nor is it a long-term motivator for your employees.

Once the problem is identified, you can begin to fail. Because once you know where you are trying to add value, you know what you need to learn in order to get the job done. And failing fast is all about learning what will meet the needs of the market as quickly as possible.

A pattern and process for listening to their existing customers.

Listening to your customers does two things: it helps you find problems to solve, and it builds trust so customers are willing to buy new products.

How well are you already listening to your customers’ challenges? When a customer gives you feedback that a part of their experience was difficult, do you educate them on what they could have done better? Or do you come up with new ways to make the experience more seamless?

If you’re not delivering on what your customers are asking for today, you’re not showing that you care. And if they don’t think you care, chances are good that they won’t want to try your next new thing.

A full picture of what they bring to the table.

Just because the market is changing doesn’t mean a company is equipped to change with it. You may go out and identify the driver of market change, and thus the problem to be solved, but do you have the capability to solve it?

Many companies believe they do – they look at the numbers and think “we deserve a piece of this pie.” You may not deserve it, which is not an easy thing to hear. But you can earn it.

Why are others getting a piece of the pie? Do you bring similar qualities to the table? If not, is there something that makes you uniquely positioned to help the customer in another way? 

If you aren’t uniquely positioned now, identify the types of activities that would help you get there. Agree on how much you’re willing to invest, in which types of capabilities, and the growth rate you’re targeting.

Companies that skip this step and go straight to ideation find that they have no criteria with which to make a decision. This is much like buying a house. Early in the process, you need to answer some questions. What cities are you willing to move to? How many square feet? How many bathrooms? Yard? Budget? Schools?

Not addressing key criteria up front is the equivalent of sending a realtor out and telling them to “find something good.” You can imagine how long this process might take, and it’s the same in a company. Taking time to set parameters in the beginning makes the decision and execution quicker in the end.

A separate set of tools, metrics, and rewards versus the core business.

Companies looking to grow into a new area typically have a core business or product that is already doing very well. The metrics for that are typically dollars or volume.

In a new space, this won’t be the case. Many companies become disillusioned when they realize they can’t predict exponential growth with certainty. They call the new area niche, or they look at how strong and stable the growth is in other parts of their business. And then they pause. Because this area looks different.

They don’t try. They hold off saying “yes” until something looks a little more certain, which is the exact opposite of failing fast – because in order to fail, you have to try.

We can look to angel investors as an example of how this works well. Angel investors aren’t concerned with the growth projections – because they know any estimate of sales will be wrong at an early stage. They are more focused on what the team will learn and what capabilities will be built – not what is produced.

Much like angel investors do with a startup, companies must base metrics of success for new innovation to be based on learning and growth. Distinct markers must exist so that they can be celebrated alongside your existing business. Do not add these to the existing “pie,” or use existing units of measurement, or everyone loses motivation and interest.

A connection to their organizational strategy.

For a growth initiative to be successful, it must be built into the organizational framework at a high level – not just “approved,” but prioritized and integrated in a way that allows for it to receive equal or greater attention than the other parts of the existing business.

Aligning the pieces of a successful innovation initiative works best when done within the context of a large, specific organizational goal. It needs to truly be a priority and not just an experiment, as competing priorities that are seen as less risky will more easily grab attention without regular, conscious effort to elevate the new area.

Much like a startup, organizations need to chart a path for continued investment throughout the life of the effort to maintain momentum. Also like a startup, they need to be crystal clear on what the goal is and who has decision-making authority so that momentum can be maintained. Because if you can’t decide fast, you can’t fail fast. 

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