Built to fail: Innovation strategies for the web

Recently there was a post on the web analytics demystified users group about having a mistake in your analysis. This got me thinking about some of the classes I took recently around innovation and strategy (I recently finished up my MBA). The classes always pointed to the same thing, successful companies are built to fail. And the model of being built for failure is becoming somewhat of a disrupter because it nurtures innovation. Constantly staying ahead requires that you try different things and measure the success.

My last post was about Omniture and some of the concerns I had about the change from innovative culture to more organized and clanish. I thought about how this happened or how it was allowed to happen and it seems like this is a pretty common occurrence to any successful organization. Think about it, Omniture made some ground by being more innovative than Webtrends and other web analytics companies (well maybe not visual sciences, but visual didn’t get the marketing/sales piece). Having some success the executive team started looking around for experienced management that had success. They looked for the people that really did well at making money from existing products. When you move those people into another company with a successful product, they will also be successful. Why? Because they organize and market things very well.

Well, put them in a company where there is great uncertainty and that is where they have a tough time. Using the same set of tools that they have developed doesn’t work because it stifles innovation. You start to see huge planning cycles for products that may or may not have a market. A lot more money is spent to go after a market that may or may not want the product or the market may not even exist. The cool thing about being innovative is that you can try many things at a low cost and see which ones find a market. I was sad to see Omniture lose some of the agility it once had, but maybe Omniture has found its market, and they are ready to make the switch to being more organized. But if there is still uncertainty about where things are going with web analytics and web optimization they should focus on management schooled in innovation.

So, back to planning to fail. Planning to fail means that you try things that you think will be successful or at least have a chance at success and measure the success of the changes. The culture that creates innovation is the one that says it is “OK to fail”. But with that failure they build in a way to fail safely. That is the needed piece, designing an architecture that allows for safely failing. This way many things can be tried and a fraction will end up being a “bulls eye”.

I probably watched the sixty minutes video on IDEO like a dozen time in different classes. There probably isn’t a better company to get the point across about innovating better than IDEO. They basically get a bunch of people together from different backgrounds and allow them to brainstorm out a product for a market.

IDEO Innovation Techniques:

Different individuals’ backgrounds create more ideas.

  • They don’t hire the “you are like me” people. They look for diversity to engender different ideas.

There is no bad idea.

  • An idea should never be shot down. In fact the craziest ideas should be explored because there may be something there that has the seeds of innovation.

Rapid prototyping.

  • Once they have a few ideas they quickly create the prototype to see something tangible and get feedback from customers. They have a machine shop on premise to rapidly create a prototype for their ideas.

Get out in the real world.

  • They do a lot of customer research by leaving the building and interacting with potential customers. This includes showing different prototypes.

Even though they take these steps to be successful, still only a fraction of their ideas are successful, but the point is, they have successful ideas. With most companies they see a need and plain and simple get lucky. If they are looking at a market in fluctuation or at a market with an uncertain future, these types of concepts should probably be used to keep innovative and stay ahead of any potential competition, especially with those that compete on price.

But, back to my original thought on web analytics and web site optimization. We use web analytics to create actions that optimize the site, meaning we ‘help’ our potential customers better find our site and ‘help’ them convert once they click through. Doing any analysis without taking action is just silly, but sometimes that analysis is just going to be dead wrong. But as a web analyst we can’t spend our time second guessing if we truly want to find those gold nuggets that really kick the site into overdrive. That is why changes to the site need to be made, but measured and measured quickly. And, sometimes you really don’t know the affects of what your changes may have made. So, beyond using a good web analytics tool, a tool like RUM or Tealeaf would be great to quickly understand how the users are reacting to the changes individually rather than in aggregate. It is like observing your customer’s actions at a store when they pick up the new product. Also, survey any users who may have been affected by the change to get the attitudinal data. Combining the attitudinal and the behavioral should give the picture of the affects from the change that was made.

If the change is wreaking havoc on the site, get it back to how it was before and analyze what happened. You may learn something about your customers you did not know before and you may have just come closer to the gold vein you have been mining for.

And just to show that this should apply to the web here is part of a manifesto from Avinash Kaushik, a guru in web analytics.

“I believe that God created the Internet so we could fail faster. In the offline world it is very expensive to experiment and test, the cost of failure is very high. As a result we don’t take risks. We keep doing what we think ‘works’, until the day we go bankrupt. The web changes that. You can take dramatic risks, at very low costs and learn big. Your website is nothing but a machine built to make you smart by taking lots of risks. Why should you tolerate ideas getting killed on conference room tables or by your HiPPO’s? Why accept opinions when you can convert them into hypothesis and get them validated for cheap and quickly? Why not let your customers actively be a part of helping you create customer experiences that deliver value to them AND to you? The cost of taking risk on the web is low. You can try an idea. As soon as it is live data starts following it. If the idea is a total loser then kill it fast, does not have to cost you a ton of money. What is more likely is that you will find winners that you had never imagined. Give it a try. Fail faster.”

-Ryan Ekins

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