Innovation and expansion plans are important keys to growth for companies across industries. Developing new growth ideas can be exciting, but at the same time fraught with risk. What can be better than leveraging the unique competencies of your organization to solve customer problems in a way that no one in the marketplace is currently doing?
Where we’ve seen pitfalls with this is where the excitement of the ideation stage and exploring the feasibility overwhelm the rigor around the efficacy, or reality check, needed to properly present the plan to stakeholders for funding. To put a finer point on it, the two most common mistakes are:
- Over-estimating the total available market, and
- Under-estimating the barriers to customer adoption
Better doesn’t necessarily translate to easy sales, and customers, and while they might be wild about the idea, are usually reluctant to give up their legacy solution, however outdated or inelegant it may be.
In B2B technology and services, there is the additional impediment; you have organizational inertia getting in the way of the adoption cycle. Organizations have become more democratic with respect to adopting new solutions. Lots of stakeholders at the table; risk aversion is rampant. Objections to your innovation can come from anywhere in the buying organization – and these naysayers can put the kibosh on adoption, despite herculean efforts to induce trial.
So, does this mean you shouldn’t innovate? Of course not. The key take-away is about taking a sober look at the path to profitability of any new product or innovation. Don’t let your excitement about the upside overwhelm your good judgement. This requires critical thinking, hard data, and some devil’s advocates in the mix. Ignoring these facts and challenges can be career-threatening.
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