The biggest challenge in innovation and entrepreneurship is not the search for THE idea, nor is it about the execution of an idea. Of course you need great execution to succeed. Of course you need some vision of where the opportunities lie. However, the real challenge and difficult part in innovation is the task of an idea and a vision of the future into something that can work.
7 out of 10 products and services fail to deliver on expectations and the #1 reason startups fail is because of a lack of viable business model. You could argue that all these failures just pursued bad ideas. That is probably true, but I’d frame it differently. All these failures resulted from a lack of testing and adapting the idea until it could work. They stuck with executing an idea that looked good.
However, the real challenge in innovation and entrepreneurship is not to find the perfect idea. The difficult part is the search for a customer value proposition and business model that will make an idea work. That’s why Steve Blank, the initiator of the Lean Startup movement, calls a startup a temporary organization searching for a repeatable and scalable business model.
Unfortunately, many established companies and startup entrepreneurs still believe in the myth of the “best idea”. Companies believe if they find the best idea--through idea competitions or maybe an inspired CEO--then all they need to do is start executing. In reality, companies should accept that the idea is just the beginning of a search problem. When you start out on your innovation journey your only task is to decrease the risk of executing something that nobody wants.
The search problem includes two activities:
- Designing and shaping ideas rapidly with the Business Model Canvas and Value Proposition Canvas.
- Testing the underlying assumptions that would need to be true for your idea to work and find evidence that you’re on the right path.
When you have enough evidence that you’re on the right track you can move to execution. In this next phase, the challenge is to scale your idea and get the potential business to the next level. In our prototype Business Portfolio Map, Yves Pigneur and I explain how the first part (search) happens in the innovation engine. The second part (execute) happens in the execution engine.