Why good concepts are strangled at birth
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?
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.