Can Too Much Innovation Be a Bad Thing? Or Are We Doing Too Little?

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by: Idris Mootee

Managed to get home on a midday flight and getting some work done on the plane is not bad. I find it is often a good idea to have a few hours on Friday to plan what to do for the weekend (I mean what work to do). So I use Friday afternoon to prepare uninterrupted work and then Sunday night to plan for the week.

I get a lot of questions on "what constitutes an innovator" and there’s no simple definition on this one. There are companies that are serial innovators (3M,, Google) and there are occasional innovators. And then there are hyper-innovators (mostly in the CPG and CE world) who constantly innovate on a product level to the extent that they create diminishing return. There are strategic innovators who look for opportunities for disruption up and down the value chain.

There are challenges with hyper-innovators because they are adding too much complexity to their product portfolio and as a result miss out up to 40% in incremental revenues (according to a Bain Global Survey). Their findings suggest that hyper-innovators may make it harder for people to find exactly what they want, or for sales people to match the right product with the right customer. As a result, there are a lack of co-ordination and synergies among these activities. This is most common in consumer electronics, CPG and the automobile industry.

The most common mistake when people are adding too much complexity while innovating new products and services without realizing that’s what’s happening. A key part of any innovation journey is to find a path to ultra-simplicity and yet deliver the value customers expect. If you make your product or services complicated, it could be that you don’t understand enough your customer needs and should try to be laser-focused. Work hard to identify the optimal point of innovation as customer needs and technologies evolve.

Is there anything called too much innovation? No, it is where innovation effort is applied. There always is a time when any evolution of any products or services are only incremental and creating no new value to customers. This “overshooting” is common among software products and technical products. Almost all Microsoft Office products are “overshoots” and we only use 10% of those features but have to deal with the unnecessary complexity. Vista is a big overshoot. Sony PS3 is another one. Markets believe these performances claim can be key differentiators but the reality is customers just don’t care. The best example is any remote control. Almost 99% of all remote controls are “overshoots”. Ask yourself how many other buttons you would use other than power on/off, channel, volume? Why can’t they just give me 6 buttons? Every remote control I’ve seen failed usability and human factor test. What are these people thinking?

Innovation is supposed to bring progress to our societies, not slowing us down or creating short-term benefits at the expense of long-term economic and environmental costs. What makes such progress possible? Economists and historians of technology agree that scientific and technical innovation is fostered by the rule of law, low inflation and the absence of civil disruptions. These conditions encourage inventors and entrepreneurs to believe that they will reap the fruits of their efforts. This is not the whole story. Michael Darby and Lynne Zucker of UCLA suggest that innovation occurs when business leaders discover a path to dramatically increased profits and then follow up by spending funds on research and development and seeking patents for the resulting innovations. And government, they claim, plays almost no role in innovation. I cannot fully agree with that, I think government should play a role in promoting innovation. One simple example, there will be no Internet if US Govt had not invested in its development together with the universities.

Another important of our innovation effort is to innovation in sustainability. We have underestimate the true cost of what we produced and consumed. Most of the problems the world is experiencing today stem from a failure to tabulate true costs of products. We’re finally paying costs that we’d relegated to what traditional economic thought disregards as externalities (factors that aren’t included in a cost calculus). Products need to factor in their environmental and societal impact along the value chain. Sustainable innovation need to tackle the fundamentals of external cost. Expect to see waves of innovation on that front.

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