How to Identify the Promising Opportunities in a Flood of Ideas
In the park by my kids' preschool here in Maryland, there are so many acorns it is almost hard to walk or avoid getting hit in the head. They are saying that 2023 is a “mast year” for trees, which is why we are seeing all these acorns.
It may seem like an inefficient way to get to a tree, but it occurred to me that I’ve seen it work in businesses that know that entertaining a high volume of ideas is often the way to get to that one great, breakthrough idea - the trick for a business is, how do you find the nut the becomes the tree?
We hear things from our customers all the time like:
- “How do you quickly filter the promising stuff from the bad ideas that should be killed?”
- “It seems like a good idea, but how do I know if it will generate the revenue we need?”
These are some of the most common questions from leaders at B2B services organizations looking to productize. The challenge for them is rarely finding ideas; the real challenge is knowing how to sift the good ideas from the bad. But it doesn’t have to be hard. By establishing and maintaining a formal process, prioritizing ideas not only becomes easier but also can be a transformative step in building a consistent approach to successful innovation.
To prioritize product ideas, you need to build a process that reflects the four key elements of successful, sustainable product evaluation. The process must be:
Each of these elements will enable you to discover the best opportunities to pursue and create fertile ground for them to succeed.
To paraphrase one product leader: “Our initial approach to product development has been like the Wild West where we jump right to implementing customer requests or ideas from executives.”
In most organizations, there is no clear guidance on how to document an idea, where to put it, or how and when it gets reviewed. But a standard, replicable, and consistent process creates a remedy for the confusion and wasted effort of ad-hoc product decisions. Depending on how many new ideas your business generates, a monthly or quarterly meeting cadence should be sufficient to evaluate all new opportunities. The submissions should be in the form of a very high-level business case that would take no more than 30 minutes to document so that the team does not spend significant effort on something that may not be pursued.
This regular forum avoids the pitfalls of the two extremes of an overly rigid and opaque annual process, and the chaos of endless ad-hoc meetings and unstructured requests. But to enjoy those benefits, everyone needs to know about it. Which leads to our second hallmark.
A good product evaluation process accounts for the fact that the best ideas can come from anywhere. B2B services organizations often rely on consultants and account managers across the organization to bring new products to the existing client base. Instead, by giving everyone a voice, any employee with an idea should feel welcomed and encouraged into the innovation journey and are generally more likely to support the introduction of new products.
Korn Ferry, a global consulting organization, put in place their “Product Concept Commit” meeting, which invited broad participation in innovation across the organization. Christopher Ellehuus, President at Korn Ferry Digital said, “You can do a lot of change management with a well-designed governance process that allows a wide range of people to submit ideas and get involved in the process. Our Product Concept Commit process also gives us a chance to see who is willing to raise their hands, come on board, become true believers, and take that back to their own teams.” (p.148 of Fearless)
In order to realize the benefits of an inclusive process, employees need to feel like it is not just “innovation theater” as one client called it. Employees must experience the process as an authentic part of the organization’s governance. This means there needs to be a governing body that is made up of the right people to properly evaluate opportunities and who are empowered to decide what to pursue. Senior leaders need to be aligned and transparent on how they evaluate innovation, and disciplined enough to prevent anyone from going around the process. The stories of what happens in the meeting will reverberate across the organization and, if done well, can promote innovation to flourish.
The most common mistake we see from companies looking to productize is failing to solve an urgent and expensive customer problem. There are many reasons organizations fall into this trap, but it often starts by jumping right to picking solutions to deliver without understanding the problem, leading to product/market mismatch and, ultimately, disappointing commercial results.
On the flip side, I have seen firsthand just how impactful it can be to make the simple change to start by identifying customer problems to solve. When I was at Employee Navigator, I shifted how we tracked all the potential product work to be done from “Features” to “Problems.” That change alone helped transform the way the product team approached their prioritization, and it also transformed how all the other departments interacted with the product team and our customers. The biggest difference was that when a customer asked for something, the first question asked was “what problem will that solve?” That small change enabled the whole organization to listen better for customers’ true needs and discover the best solution to meet those needs.
And when products are evaluated and prioritized starting from the customer problem, it drives a more focused prioritization process; not to mention it also enables a more customer-centric, outcomes-focused culture.
4. Right Sized
A good product governance process must strike a balance between underdone and overengineered.
I’m almost embarrassed to admit how many annual planning efforts I’ve seen that included business cases for seven-figure investments based purely on assumptions that lacked adequate research. Over-engineered processes too early in the life cycle are typically based on wild assumptions, the result being that some poor product team will then need to try and deliver a fantasy.
For this reason, when vetting a new product concept the goal should be right-sized; the goal is not to decide if the product will be a huge profit driver or a decision to fully fund the development of a green-field idea. It should be simpler and lower-stakes.
The goal should be to decide on the next most important assumption to research further. It takes the pressure down and removes many of the biases in the selection process. The evaluation becomes an iterative process of vetting the results of tested assumptions as you build a stronger and stronger business case. You will simultaneously build an MVP, a beta, a v1, and so on, testing and learning as you go (for starters, does the concept solve an urgent and expensive customer problem?). If at any point assumptions are wrong, then it is a major win to have only spent X dollars testing a concept we now know will fail vs. 10X on building a concept that does fail and creates a huge loss for the organization.
Implementing an innovation process with these four key elements can be transformative for the business, and is not difficult to achieve. Helping organizations set up a prioritization process is one of the most frequent ways I work with our customers at Vecteris. If you want to learn more about how you could build a similar process for your organization, please reach out!