For the last article of this series, we focus on piloting revolutionary initiatives, the ideas that can open entirely new businesses for a company, or reinvent legacy businesses stuck in the status quo.
Such initiatives are revolutionary because they lack precedent within the company, are transformational or have disruptive implications for the core business.
Pursuing them means facing high uncertainty and the need to learn by doing.
For these challenges, you want a dedicated incubation group that has the autonomy and specialised skills to think differently, act differently and learn on behalf of the entire company.
To illustrate the way this team thinks and acts differently, below are some tips and tricks for piloting under uncertainty.
Reset the context for failure
For all stakeholders – including the incubation group’s project team and governing body – the focus should be on learning and adapting, with failure defined only as not doing so.
Everyone involved should expect that at least some of the starting assumptions will be wrong and that the goal of the pilot is to acquire information to get closer to right.
That way, the team can assess and act on learnings objectively, rather than be defensive about things not going to plan.
That said, some projects’ best learning and adaptation will be to fail fast. Maybe the pilot exposes a fatally flawedmarket assumption or a technical roadblock.
Quickly finding such killers should be seen as an accomplishment. It saves the company time and money, and it steers the overall innovation portfolio to redirect resources efficiently from dead ends to promising avenues.
In that regard, you want a group that is built to succeed via productive forms of failure.
Pilot early and often
With high uncertainty, the value of speculating and debating about an opportunity in the abstract is limited.
The faster you can get something to market for the purpose of learning, the more quickly the arguments can be based on facts rather than assumptions.
Likewise, the more you can break up a big pilot into a series of smaller ones, the more cheaply you can buy down the risk and uncertainty.
This early tangibility can be critical to overcoming scepticism that might otherwise stymie a big idea.
Have hypotheses and goals
Although the focus is on learning, the pilot process still requires rigour and discipline to achieve that goal. At the start of each pilot, you will want to be clear on:
l What you want to learn.
l A hypothesis for the answer.
l Criteria for a go or no-go decision to the next phase.
If identified in advance, these three elements allow the team to hone in on what it is trying to learn when crafting the pilot.
They will also provide guidance to the team during the pilot when it is faced with the potential for mid-stream interventions or adaptations.
As the team monitors the pilot against its hypotheses and goals, and gathers other lessons, it will want to share the emerging results, with, for example, the core business or governing committee.
Proceed with caution. Both good and bad news travels fast and quickly loses the context of early results or emerging trends.
Define a public moment
Pilots need urgency or they can get stuck in the planning stage, especially when elements of the pilot are dependent on other parts of the company that are focused on executing for the core business.
As the team and its internal partners figureout what to do, is perfectionist about how to do it, or gets pulled into other efforts, timelines for milestones can slip by.
Speed and capital-efficiency evaporate.
A fantastic forcing function to drive momentum is committing to a public moment with customers or channels.
Whether it is a soft launch to a few customers, a joint press release about a beta offering to a small customer segment or a training session for distribution partners, once a date is committed and communicated in advance, everyone knows the game is different.
A pilot project often needs that extra impetus.
Embrace the kludge
A kludge – quick workaround – is a good-enough solution. In creating a pilot, a kludge is often sufficient, if not desirable, because you do not know where it will lead.
Some pilots will end up as throwaways, and most will end up pointing the way to significant changes. So don’t over-invest up front on technologies or expensive work processes that are subject to disposal or change.
Create the minimum viable solution for achieving the pilot’s goals, then use the budget and time you saved up front to build what you have learned is the right thing.
A few examples:
l If the pilot is expected to lead to a handful of people calling a helpdesk and you are not looking for call centre lessons, then route the calls to the innovation team rather than running them through the company’s call centre and having to train a few hundred representatives.
l If the pilot needs to integrate with a corporate database but is not testing that functionality, then just get a one-time copy of the database, or a sub-set of the database. Don’t spend the extra time and organisational capital to integrate with the live database until you need to.
Engage and prepare the core business
Communication and coordination with stakeholders in the core business is critical if the opportunity is one that will ultimately land there.
The incubation team partners the core business stakeholders throughout a project, beyond the day-to-day tasks of setting up the operational aspects of the pilot.
They work with, but outside, the core business to ensure initiatives have support and, if successful, have a way to transition successfully into the core business.
Have an adaptable and creative team
The incubation team needs to be results-oriented but flexible in how it gets there. It needs to be adaptable – ready and willing to change quickly.
Creativity is valued, not only up front for the concept, but also for running the operational aspects of the pilot, including kludges.
Finally, the incubation team must be committed to the innovation process firstand then to the broad opportunity – not the specifi cinstance – second.
As discussed above, it must recognise that killing or changing a project is not failure.
The leader of the corporate venturing and innovation group plays a critical role in helping the team – and sometimes the governing committee – to manage its emotional attachment to any single opportunity, guiding it to value the process and the portfolio.
In summary, when piloting transformational or disruptive opportunities, applying the tips and tricks described here can increase the chances of success.
They support the incubation team’s structural design to bring the focus, agility and speed of a start-up into the environment of a large corporation.