Loss of revenue potential

New offerings have a life cycle, see below. They start at infancy, then expand, to slowly mature. Through these stages, profitability and revenues change.

In the early infancy, there is little competition, so you can ask a high price for the new service. Yet, often the cost of sales is high too because the offering is new. As a result, you need to put in lots of time and effort to sell the new service. So the margins in the infancy stage are typically not that high.

Then comes a phase that is golden. You can ask a high price, because competition is still low, yet the cost of sales is dropping significantly because people become familiar with the new offering. This happens at the transition from infancy to expansion and during the early phases of expansion.

Unfortunately, as your offering matures others will start to copy you and your pricing will come under pressure. The service becomes a commodity.

This pricing pressure will become even worse at the end of a product's life cycle, when the offering has matured. Now there is a lot of competition. To stand out, you need to offer extras which will increase your cost of sales. Your profit margins will dwindle, until a point that providing the offering is no longer worth it.

When delivering a new service offering, the highest returns come therefore during the expansion phase. If you are too slow with developing your new offer and take too much time in the infancy stage, the time of the expansion phase will shrink. You are given others time to catch on and catch up.

In other words, you want to speed up your innovation project, so you are far ahead of everyone else when you hit the expansion phase. That way, you can enjoy this phase of limited competition and high-profit margins as long as possible.

Inefficiencies

When things go slow, people start to do other things. Such multitasking is known to be inefficient and costly. Each switch may not take much time, but it adds up. There is an estimated 40% productivity loss when multi-tasking (source). Such productivity loss is worst when doing complex unpredictable work (source).

Momentum

When you have to stop and go, stop and go, etc., it takes up a lot of energy. Just like driving in stop and go traffic that is extremely tiring. So you want to keep the momentum going.

The same holds for driving at half speed. Eventually, you may get there, however, it is very likely that midway the journey you give up, because it all goes so slow. What more, others may start passing you on the left and the right. If that happens in traffic, most of us want to switch lanes. The same holds for your innovation project.

Try therefore to maintain the speed and momentum you built at the start as long as you can.

Opportunity costs

Last but not least, there are opportunity costs to consider. There is only so much you can do at the same time. While working on one innovation project, you cannot work on another. The longer it will take you to bring that project to a conclusion, the less time you have to devote to other growth opportunities. It is as simple as that.

How to speed up the pace of your project?

To avoid being paralyzed by a big uncertain task like your innovation project, it helps to divide up the innovation process into smaller doable tasks, so you can maintain speed. You don't have to do all at once. Instead of thinking about the huge undertaking that is ahead of you, stay focused on what is just in front (1).

What more, dividing the work up in subtasks that are worthwhile, will give you small successes to celebrate. These small successes will keep your project going and prevent your team from falling into the trap of procrastination and other self-defeating tactics.

To be clear, it is perfectly fine to have the ambition to change the world and dream big. However, that should not prevent you from starting small. It works much better to book small successes first, create momentum, and win big from there, than trying to win big out of nowhere. Small wins are your friend.

Below are a few other things that will help to speed up your innovation project.

Focus

Try to stay focused on mission-critical tasks.

Maintaining speed does not mean that you should work on the easy tasks first. Quite the opposite. Tackle the things that you know will make or break your project first. That is, fail fast to succeed sooner.

Speed is a matter of knowing what to do and what not to do. Cutting corners will only cause delays later on.

Follow the process

Put the time and energy there were it matters most, moving your project forward. Don't try to innovate the process. Stay focused on the delivery of your project.

Speed is a matter of knowing what to do and what not to do(1). Cutting corners will only cause delays later on

Build a solid foundation first

When working on the foundations, customer discovery, background research, obtaining buy-in, etc. it may look like you make little progress, as you seemingly have little to show for. However, that could not be further from the truth.

Celebrate each interview, each champion, each stakeholder won over, as those are huge steps forward. The insights gained during these interviews will enable you to keep speed and momentum when it starts to really matter - in the development phase.

So make sure you use proper progress metrics from the start. Metrics that incentivize you to do the right things, instead of delivering paper results. Make sure your progress and speed are real.

Better time management

Set time aside for your innovation project and don't work on too many projects at the same time. The innovators we work with usually cannot devote all of their time to their project, certainly not at the early phases.

I am not a time management expert, but I know that I progress much faster if I set aside dedicated time and make sure that there is continuity in the project I am undertaking at that moment. Even if it is just 5 minutes on a day, I try to move my project along. That way I stay on top and don't waste time having to refamiliarize myself and restart each time.

Work fulltime on your project

Of course, working full time on your project will provide you the biggest gain in speed.

However, very few of us have the luxury to be able to work full time on their innovation project.

Nevertheless, it is good to realize, that when you work 40 hours on your project instead of 4 hours each week, you go at least 10x as fast. That is worth serious consideration when you get to the development and implementation phases.

Success with speeding up your innovation project!

 

 

 

Related blogs:

• Business as unusual; create innovation options to thrive
• The Innovation Management Process
• How to stop? 3 tips to prevent escalation of commitment