How to Innovate Successfully

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Scenario: "Dude, we need to build a rockin' beta-ready product first. Then, we'll test it. Yay!" The problem with waiting until your product reaches that beta stage? Your financial risks increase exponentially in:

  • Resources.
  • Time.
  • Morale.
  • Lost opportunities.
  • Cash, cash, cash.

Now, let's say you build your beta-ready product 9 months later.

What if the market reacts negatively to that product?

  1. The pessimistic side would tell you to give up.
  2. The optimistic side would tell you: "Wait, that just means we have to refine the product to their needs more!"

You're choosing the right path with that last answer. But when you do, it hits you: "We wasted 9 months in lost resources, time, morale, lost opportunities, and cash -- when we could've received the same frickin' feedback 8 months earlier!" Instead, do this:

  1. Build something quickly that's test-ready.
  2. Then start testing the sucka.
  3. Measure the results: Are they promising?
    • If not, dump it -- you just saved lots of resources for better innovations.
    • If results however looking promising, juice up more investments into it.

Do that in a continuous cycle, and you'll build one ridiculously awesome innovation machine.

Why Spending Loads of Time on Something Sucks

You're no fortune teller. No one is.

  • Yet, you hear stories of Timmy Toothie on the other side of the town locked in his basement conceptualizing the next world-changing innovation that will make him billions.
  • You hear a similar story happening with Susie Saddy in Tulsa.

In fact, a close acquaintance just told you (1) he has the perfect idea, but (2) he can't tell you, and (3) he's so self-assured with his looming success that he's acting all self-pretentious on yo ass wondering why the !@^^ you don't have a spiffy idea of your own. They're all trying to predict the future. In other words, they're speculating what will happen. They're using a snapshot in time to predict a frickin' moving world months/years/yadda later. If the most experienced Silicon Valley venture capitalists still get it wrong, what makes them think they're ridicuslously better at predicting the future?

  • Segway -- heralded by Innovation Machine Man Steve Jobs as one of the greatest ever inventions, and the best VCs -- took a nosedive when it hit the market.

Predicting the future seems plausible; but, it's frickin' impossible. But, if you still think you can: trash whatever idea you have; those multi-billion dollar Wall Street firms want your brain. They'll give you trillions. The better way to innovating:

Build Just Enough for Testing

Only the real-world market decides if your product's successful. So:

  1. Get your idea into your customers' hands as quickly -- with as few resources -- as humanly possible.
  2. See how much you could sell.
  3. Measure the results, then proceed accordingly.

That way, you:

  1. Minimize risks.
  2. Maximize chances of success.

Religiously follow that cycle over the long-term, and you'll boost your success rate like a mofo.

You'll Lose Money. No Big Deal.

Think about it this way: If you played a coin-flip game where:

  • You'd get $100 for every time the coin lands on head.
  • You'd lose $90 for every time the coin lands on tails.

You'd play that game with anyone, anywhere, at anytime. Sure, you'll lose from time-to-time. $90 here, $90 there. But the more you play it, the more the odds will favor you -- and the more money you'll eventually make. Your winnings will more than make up for your losses. As in Poker, you don't worry about the individual results; instead, you focus on making consistently good decisions over time that will pull you ahead in the long-run.

Think of innovating the same way.

Conservatively, think:

  • 1 product will succeed for every 10 products you do.
  • That 1 product will more than make up for the failures.

The more times you go through that cycle (e.g. 20 products will produce 2 successes, etc., etc.), the more you'll pull ahead -- and, the more ridiculously rich your company will be. You could:

  • (1) take years draining resources to go through 1 cycle, or:
  • (2) take a few months conserving resources to go through it 10 times.

The faster you do it, the sexier off you'll be.

Go through it like a juiced-up ostrich on 'roids:
  1. Build test product quickly.
  2. Test how much you can sell.
  3. If results look promising, invest more. (If not, dump it.)
  4. Restart at ^1.

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Posted on May 23

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