This post originally appeared in Campaign Asia on 8 March 2016.
Everyone wants to channel the incredible disruption and success of Silicon Valley, but how should we go about doing it? Whenever great leaders write their memoirs or business self-help books, common themes tend to emerge. The path to success is rarely straight, usually featuring a fair dose of good fortune, adversity, hard work and close calls that make the story compelling. And the companies involved often share the personalities of their leaders. These companies, particularly those in the technology sector, often bear the hallmarks of resilience and adaptation that should see them flourish for years to come.
But when we look inside the typical organisation things aren’t so encouraging. We can see that many processes and practices are designed in such a way that they limit exposure to the conditions that drive success. A new business forged in harsh market conditions can only succeed through a maniacal focus on customer needs, so why do so many companies restrict this frequent contact with their customers?
It isn’t all bad news. Some processes, such as those employed in product design, have established methodologies to drive user engagement and validation, from inception through to launch. Maybe this is because failure rates are generally high if customers aren’t directly involved along the way. But others, particularly in the marketing space, fall short. From strategy to design to production, unvalidated assumptions are made about the customers’ motivations and behaviours, usually through rose-tinted glasses. The team works for months in an echo chamber, and then wonders why the end result falls flat. The failure to engage with customers across the board leads to a business which is less effective and ultimately more exposed to an unforgiving market.
Why is this so? Are the ideas so majestic and Earth-shattering that any member of the public would immediately break any non-disclosure agreement to get the news out? Of course not. In fact from experience I’d say not involving the customers makes the opposite likely. Assuming the leader has been brave enough to back an innovative idea, it tends to get watered down between agreement and launch as the lawyers and jobsworths have their say — unless the customer’s voice keeps the idea alive.
Given how many successful people and companies talk about testing and learning and iteration and validation, it’s remarkable how few companies actually put it into practice. Remarkable — but understandable. It’s time-consuming, can be expensive, impacts your potential to hit deadlines and it forces you to confront criticism. And those are just a few of the reasons.
But when we start to pull the thread of those excuses, they start to unravel. Testing with customers can be expensive, but it doesn’t have to be. By putting effective constraints around the ideas being tested, for example using paper sketches rather than production quality assets, and insisting on quick and fast tests, we can prepare in a fraction of the time and cost. Products and services such as Usertesting.com, Testbirds, Marvel and Invision can help. And as it turns out, the less time you invest in the assets, the better you take the criticism because you haven’t invested too much of your soul in them.
This one constraint can unlock a huge amount of potential. By testing early, we’re getting incredibly rich and valuable feedback from the marketplace. This doesn’t just help us to improve our idea, it can also help open up completely new avenues for exploration. It’s this repeated exposure to the market that helped Odeo pivot into Twitter, helped Game Neverending pivot into Flickr, turned Burbn into Instagram, and many more.
You might still find you can’t hit your deadlines, and that’s OK. Much better to know you’ll be failing early on in the process, and pursue an approach with far better prospects for success.
In short, having a boss that supports and drives innovative behaviour is the key to unlocking this huge opportunity.
One concern that has to be addressed head-on is the huge percentage of startups that fail. It’s said that somewhere between 75% and 90% of startups fail in their first three years, and it’s fair to say no-one’s career is going to last long with that kind of strike rate. But this is where comparisons with Silicon Valley and the world of start-ups isn’t really that helpful. You don’t need close inspection to see that the starting conditions are having a huge impact on the outcome. Large organisations have an existing successful business model and customer base that would be the envy of any start-up. And by their very nature, start-ups are typically bringing an untested product or service to market that has to successfully jostle for space in the crowded lives and wallets of their potential customers.
Protecting brand equity is also an interesting area to explore. You could argue that their nothing-to-lose attitude gives start-ups free reign to explore ideas that could cause irreversible damage to an established company. The bigger the brand, the greater the fear that a small mistake can have catastrophic repercussions - and the higher the chance that risks won’t be taken.
We can see there are dynamics at play within the start-up world that are appealing to established companies, but adopting them wholesale is unlikely to get the results we’re looking for. By carefully adapting them for the corporate environment, and by getting closer to our customers, we can plot our path to success.