Why good concepts are strangled at birth

David Aaker

Companies need to assess innovations without prejudice, and with an acceptance of some risk, says David Aaker

One key to winning the brand-relevance battle by creating new categories or subcategories is to evaluate and select the right concepts to develop. In doing so there is a risk that a concept with high potential is not funded or has its funding cut off. As a result a firm loses the opportunity to create a category or subcategory in which the firm could hold an ongoing advantage and a potential source of profits and growth. The problem is hard to correct because the results of such decisions often are forever hidden.

What kills concepts with potential to make a difference with an innovative offering?

  1. Many are terminated by a gloom-and-doom bias that takes on several forms. Pessimism about technological advances meant that GM killed the EV1, a battery-operated car in 1998 just before a breakthrough in battery technology occurred. In 2005, GM CEO Rick Wagner said this was GM's biggest strategic blunder.