The Innovation Paradox
The problem is simple, and indeed, paradoxical. Research shows people like new products and services. They want them. And, indeed, they go out of their way to try to find them. Yet companies are truly terrible at providing the new products and services that meet their customers’ needs.
In the 1980s, research showed nine out of 10 new products failed. Some 30 years later, nothing has changed. Our research—confirmed by other firms—shows that nine out of 10 new products still fail today.
Moreover, when you look deeper—and we will walk you through our proprietary data in a minute—you actually find a second paradox within the original paradox: companies know introducing new products and services successfully is something they need to do to ensure a healthy future. And yet they readily concede that they are not devoting sufficient resources to make it happen. And at the risk of having this sound like the business equivalent of a matryoshka (those Russian dolls that nest inside one another) the reality is that there is even a third paradox within the second paradox within the initial paradox: Firms are aware that they have a problem—they openly admit that are not very good at introducing new products and services—but they have made remarkably little effort to improve their batting averages—apparently convinced that introducing new products is inherently a hit or miss process.
When you add all this up, it is easy to understand why there is a huge gap between ...