Categories: Innovation Insights
The past is an excellent guide to the present, if nothing changes. It is also a good predictor of the future if no change is planned, or the proposed changes do not address the weaknesses of the past.
It is nigh on impossible to criticize a group’s current innovation or product development initiatives – if any of these activities were wrong, they would not be doing them. Even in product development situations where there is a known failure rate for projects and later for launched products, it is logically and emotionally hard for individuals to incorporate such logic into decision making processes.
However, in spite of reluctance to question current initiatives, the patterns of the past provide a much better picture of what will happen compared to any overly hopeful current plan.
The best companies in new product development and innovation realize this and spend time analyzing past performance. They learn from failures and successes, ideally focusing on key metrics to introduce more objectivity to the analysis. Based on this method, P&G, for example calculated that the best launch revenue a major New Product Development (NPD) initiative could reach was $200m in year one revenue. Knowing that you are unlikely to beat the odds is important. Using the historic odds to design a better process is the route to success.