There are many reasons why innovation projects or new products do not break through on the market. Many companies realize that their innovations are doomed to failure only after considerable cost and intensive effort. Knowing the most common reasons for the failure of innovation programs is therefore important for robust innovation management. Although it is not possible to know all the potential problems in advance, the most frequent mistakes can be avoided.
Let's go through the four most common reasons for innovations failing:
The wrong direction is often taken in innovation projects or when choosing ideas. Making the wrong decisions could relate to the prioritization of ideas, the pursuing of concepts, or market tests. If even the company's management veer off from the chosen path (i.e. the innovation strategy) with their decision making, this increases the risk of innovations failing.
How can the situation be improved?
Inadequate commitment and a lack of support for innovations are one of the main causes for the failure of innovations. Dedication towards innovation being formalized in strategy papers and packaged in marketing claims is not enough. Innovation is something you practice. No matter how eager your innovation managers are, if the decision-makers are not on board, this will transmit through all levels of the organization.
How can the situation be improved?
What are innovations?
Innovations are new ideas, products, services, or processes that represent a significant advance over the current state of technology, science, or society and that can bring high benefits to people. They can be both incremental and disruptive and are often the result of research and development, creativity and entrepreneurship. Innovations can create a decisive competitive advantage for companies, organizations and nations and are an important driver of economic growth and social progress.
Many examples of failed innovations are down to a lack of focus on the market and the needs of customers. Consider the oft-cited example of Kodak, whose market of analog photography was disrupted by the digital camera. How can the situation be improved?
The bigger an organization is, the slower the processes often are. Sluggish processes with long decision-making cycles can be a death knell for innovations. On top of this often come interface and communication problems. All of this has a negative impact on the quality and efficiency of innovation projects.
How can the situation be improved?
There are all kinds of reasons why innovation projects or new products fail on the market. In most cases, a flop is not due to the quality of an idea, but rather the implementation. In other words, there are internal, organizational causes.
This is where company management and innovation management need to focus their attention.
If the framework conditions that foster and strengthen innovations are in harmony, companies with the same resources can record significantly higher innovation successes and thus additional sales. Innovation success therefore always depends on several factors: the innovation strategy, the structures, the methods, the processes, and the culture of innovation.
Want to learn more about how these factors are connected? The following paper provides the answers.