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2023-04-29
Too much of what we do in our industries is improving on products that have long passed a threshold of diminishing returns.
The foundation of what I teach my clients — lean-agile thinking — is easily summed up:
The world is constantly getting more complex, faster. The management and organizational frameworks that were successful and that have shaped the economic landscape for the last century are struggling in todays' world. Long-term planning and big-upfront design in a complex — and therefore unpredictable — competitive environment isn't economically sound.
The proven solution to this challenge is “iterative and incremental improvements based on empiric feedback”.
That's it, really. Of course the devil is in the details.
The idea is to build an initial version of a product fast and cheaply, and test its acceptance by the market _before_ investing in a fully fledged-out version. If acceptance is not there, stop entirely before major investments or come up with a variation that seems more likely to succeed based on the feedback of the first trial.
Once a successful variant is found, improve it until it is barely sellable and then do so: release.
After initial release, continuously improve the product by showing customers small improvements and keep the feedback cycle going.
Ultimately this requires many paradigm-shifts and a whole new work-culture. But once a company is on its way to transform accordingly, this really works. I'm constantly seeing the benefits for roughly 15 years now, the principles are even older. None of this is new anymore.
What companies and their people often forget though is that continuous improvements — in fact any form of improvements — cannot, and are not intended to, replace innovation and that many products these days are more than good enough and improving on them further does not automatically create a product variant that is better.
The inner-city bus I talked about a few posts ago is one example of this, link below. Multi-blade disposable razors which long-term are more expensive and immediatelly provide an inferior shave than traditional safety razors are another one. A third one is Microsoft Office which hasn't been missing a necessary feature for 99% of us for a long time.
Instead of investing massive amounts of manpower and marketing to create and sell ever smaller marginal improvements onto a line of products, I wish it would be less risky to invest in true innovation:
We need to experiment what _else_ is needed today, invent entirely new products (or rediscover great old ones and re-do them with todays possibilities) instead of riding a long-dead horse.
But the machine of our society doesn't seem to allow for it, at least not often. Innovation is risky, who can tell whether that new out-there idea will be adopted by the customers? So we improve rather than innovate.
Gradual improvements based on data and customer feedback do work for a long time. But they will not endlessly create better products where the actual benefit of the improvements outweigh the development costs.
As I've said before: “Progress” is one step towards a specific destination. Once the destination is reached, further “progress” will simply continue on the same line and take us _away_ from the destination: The product will get worse _and_ more expensive to make.
There is hope though: Thomas Edison and his Menlo Park Research Laboratory have shown that innovation can be made predictably successful. Today, Elon Musk is proving the same. I have many issues with his world view but he has a predictable success rate and routinely thinks outside the box.
The law of diminishing returns does apply to progress. Product marketing and the unnerving trend that fewer and fewer people seem to question what they're told seemingly makes continuous improvement seem lucrative longer than it probably is.
Be bold people! Be clear on the goal of your product vision and once reached, stop improving and innovate something new.
Improvement by nature is something gradual. Innovation is a an unforseeable riptide. We need more of the latter.
Thoughts on progress in an inner-city bus
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