How businesses can avoid three common product innovation pitfalls

In today’s fast-moving technological and competitive market, the gap between ordinary and extraordinary companies is widening. Product development is seen as a crucial part of innovation and companies are trying to crack the code to meet customer needs in a novel way and stay relevant. According to a recap on PDMA Best Practice studies, it takes more than speed, quality and costs to innovate and compete, with no one factor required for high innovation performance. Rather, the “best” companies are those that undertake many product practices, continually evolve their capabilities and embrace uncertain times as an opportunity to invest in innovation rather than retreat. This research and my experience helping startups and enterprises like Microsoft and Google build and launch products over the past two decades has revealed that innovation isn’t inherent nor is infinite. Innovation is a mindset and a muscle that companies need to continuously nurture and flex. A culture that values risk-taking and empathy is just as important as having the right budget and resources. Still today, the overall new product development success rate sits at around 50% and there could be a number of different factors contributing to this. In my experience, there are three major pitfalls that companies need to watch out for when commencing new product initiatives or programs. The endless quest for product perfection  The endless quest for product perfection
Or rather, waiting for perfection to launch new products. Despite what others may tell you, you can’t build something perfect on the first go. You never have enough information on exactly how the product will be used, what features customers will actually like or dislike, and all the other dependencies that come with it. It’s better to launch a “good enough” product, test your hypothesis about customer needs, and iterate over time. One of the biggest mistakes I made early in my career was spending too much time trying to perfect the design and definition of a product. When it did finally launch, we didn’t anticipate many versus any of the user requests that came through and how the product would actually be used. If we had shortened the design and build time, we could have spent more time on user cycles to refine and strengthen it. The most innovative companies are those that continuously launch and iterate.  Product value is in the eye of the beholder  Product value is in the eye of the beholder
Another common pitfall that startups and companies face in product development is customer value. How do you define the value of your product? Can you measure it? Still today, very few companies are able to answer those questions, and many fall into the trap of focusing on launching lots of new product features and service improvements that are unquantifiable in value, and don’t stand the test of time. To measure value, it is crucial to have a shared understanding of what the amount and nature of value in a particular product or service is. Customer value can be monetary such as growing revenue, or functional such as saving time and reducing manual effort. Value, in many cases, is distinct from price. Once you’re clear on what it is, you need a robust way to model and measure value creation over time. The absence of a clear vision and measurable goals  The absence of a clear vision and measurable goals
In every successful product initiative that I’ve seen, each has a clear vision that is easy to communicate to employees, customers and other stakeholders. The vision goes beyond numbers and helps to clarify the strategic direction in which the organisation is headed and articulates what you’re trying to accomplish with the product and why. Without a simple vision to guide people, product initiatives can quickly dissolve into disparate projects across siloed teams with no clear alignment or direction. Equally as important is setting clear and measurable goals around that vision and holding your team accountable to these goals. In successful product launches, leaders establish short and longer-term goals, measure performance improvements, celebrate milestones, and reward people along the way. Employees are emboldened to try novel approaches, develop new ideas, and provide leadership. Finally, you need the right people to rally around that vision. In product initiatives where you’re pushing the boundaries of what is possible, attitude matters as much as aptitude. While technical skills such as coding, data analysis, and prototyping are important, so are soft skills like having an ownership mindset, problem-solving, and the ability to emphatise with the users. In successful product teams, everyone has accountability and responsibility for the outcomes , not just the outputs. Production innovation starts by laying out a clear vision, prioritising discovery over design and encouraging experimentation to discover the right products to build. This will create long-term customer value and differentiation in an increasingly competitive business environment. Diya Jolly is the chief product officer at Xero.