Putting the Research Horse Before the Development Cart

R and D signpostIn my work, I am surprised at how many times I come across carts placed squarely in front of horses in terms of how R&D resources are invested in product and service innovation. Too often I see teams that have already invested heavily in solving some problem before considering if it’s really likely to be the best opportunity they could pursue. Even worse, I see plenty of developed technology in the research lab that is touted as solving a problem, but it’s just wandering around in search of any market that actually suffers from that problem. Why is it so easy for smart people to focus their laser-like talents on creative R&D without being strategic about where their efforts are likely to prove the most beneficial?

It turns out to be a surprisingly steep uphill struggle to convince people that taking certain strategically critical research steps early on prior to prototyping is worth it. And it’s not just the steps you take that matters; the order in which you take them is important too. Based on 20 years of experience of seeing my own and others’ projects founder for the lack of those steps or because they were done too late, I developed a method we call “Opportunity Discovery” that helps make sure each necessary research and analysis step takes place at the most advantageous time in the process of product or service innovation. I can’t detail this entire proprietary process here, but I will outline the main steps in order (although they can be somewhat parallelized):

parc-innovation-lab-ad-JAN1. Collect:  Gather information about your own organization’s resources and strategic direction; know what you can leverage in-house. You’d be surprised at how balkanized employees in large corporations are, to the point where you often see irrelevant, duplicated, or even internally competitive R&D effort.

2. Analyze:  Analyze what’s happening in the world and how things are changing. Major change offers the most fertile ground for big opportunities.

3. Target:  Concentrate on areas where, perhaps because of colliding trends, there is a high probability of change and even disruption. Aim to be there first or at least before a dominant player can emerge.

4. Discuss:  Talk to diverse people about what’s happening in those spheres and what their needs are or are likely to be as a result. Pick the brains of experts in those areas who can give you the best, customized synopsis as to why your organization should care about those areas, in relation to what you learned in step one above. The most successful entrepreneurs I have met always seem to be asking lots of questions.

5. Assess:  Develop a clear picture of what a good opportunity would look like for your organization, especially in terms of your strengths and weaknesses, based on steps one and four.

6. Imagine Broadly:  Consider many, many possible opportunities, drawing on lots of people’s wisdom; keep your funnel open wide early on.

7. Eliminate Systematically:  Focus on eliminating possibilities as early, cheaply, and systematically as you can, based on what you learned in steps one through five.

8. Do Not Commit:  Keep all viable possibilities open while you investigate them in more depth, but only until you can rule them out. We use a structured template at PARC to help us organize our analysis. It includes things like understanding the specific stakeholder requirements we are addressing and who we might need to partner with to bring a solution to market.

9. Mind the Gap(s):  Do a thorough competitive analysis and learn from the competition individually and overall. Find the gaps where there are no good solutions and assess if and how you can plug them better than anyone else.

10. Choose and Verify:   Choose the most promising remaining opportunity and verify assumptions.

Step 10 is the point where most R&D endeavors start, so I will conclude there, since a number of well-known, rigorous processes exist such as user experience research, iterative prototyping, and Eric RiesLean Startup method. Suffice it to say that the preceding nine steps can be completed in a few weeks and drastically reduce the risk of investing heavily in developing a cart with no wheels. In fact this is a major area where we help our clients with tools we have developed to streamline this process.

In most cases, however, it seems a product or service opportunity is chosen based on intuition, a personal preference, or a top-down directive from management. And I have seen millions of dollars plowed into engineering before teams realize that their “solution” doesn’t have a market and belatedly start to do some of the above activities. No wonder everyone in high-tech innovation knows what the new meaning of the word “pivot” is.

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