Question

Successful innovation requires an in-depth understanding of the dynamics of innovation, a well-crafted innovation strategy, and well-developed processes for implementing the innovation strategy.Innovation is an inherently risky undertaking. Most innovation projects are characterized by both technical and market uncertainty. Technical uncertainty relates to whether the project will result in a technically feasible product or service. Market uncertainty relates to what features customers will prefer and what they will be willing to pay for them. Considering these uncertainties, respond to following

QUESTIONS:

Explain why you think so many innovation projects fail to generate an economic return.

Give at least one example of a failure due to technical uncertainty and one example of a failure due to market uncertainty.

With the benefit of hindsight, what would you do differently for the examples you have given?

Answer 1

I believe that the reason because of which so many innovation projects fail to generate an economic return in because of the lack of market research and market feasibility of the idea planned to be implemented because an idea that is innovative has to generate some return on investment or else there is no point of such innovation in terms of a business. It may happen that the idea may take time but there should be potential in the product to generate revenue even in the future.

Example of a product that failed due to technical uncertainty is The Zune launched by Microsoft in 2066 as a competitor of the Apple iPod. The major technical limitation of the product was its software was limited and restricted and the product was not compatible with other software.

Example of a failure due to market uncertainty is the New Coke introduced by Coca Cola in mid 1980s which made the product flop because of its poor marketing strategy.

In the Zune case I would have made it an Open Source which would have given it a competitive advantage over the Apple iPod because of its better availability of resources. This would also made it an convenient option rather than that of iPod. In the case of New Coke, while marketing very less importance was given to regular coke drinkers which created a negative impact declining sales and I would have used effective marketing strategies so that the organization benefits from the same and make the products a success.