Strategic blind spots that superhard materials companies should avoid in technological innovation

In 1998, after years of research and development, Michelin tires introduced an unprecedented anti-penetration tire PAX system. This type of tire, after being penetrated, also allows the driver to continue for 200 kilometers at a speed of 65 kilometers per hour. It fundamentally eliminates the most dangerous punctures, as well as the inconvenience of changing tires on the roadside and waiting for rescue, and the design itself does not reduce the comfort of the driver. Michelin has introduced this new type of tires in a high-profile manner, calling it the most important breakthrough in the field of traffic safety. JDPower & Associates, a market research company in the United States that is known for providing information on the automotive industry, also highly praises this product and predicts that by 2010, 80% This new type of tire will be used in cars. Surprisingly, in 2007, Michelin announced the abandonment of the continued development of this new type of tire, acknowledging the failure. Let's look at another example. In the field of e-books, Amazon's Kindle Fire is a global leader, but in fact, the electronics giant Sony first introduced the first generation of e-books in 2006. The Amazon Kindle, launched three years later, lags behind Sony products in several key features, such as large size, heavy weight, and poor screen design. However, Sony products still suffered a defeat and had to completely withdraw from the market. Why are these high-performance innovations so unsatisfactory? In fact, these two cases are not isolated, and 80% of innovations have failed in the market. There are many reasons for innovation failure, such as not really targeting user needs, poor quality, high prices, high conversion costs and lack of supporting products. But there is another important reason that affects the success of enterprise innovation. This is the cooperation of enterprises within the industry chain. The failure of these two innovations was caused by the lack of corresponding support and cooperation from relevant enterprises within their respective industrial chains. In fact, Michelin was fully aware of this when it launched this innovation. It first spent energy and established a strong partnership with rival Goodyear to jointly advance this advanced tire. At the same time, it also signed contracts with major auto companies such as Mercedes-Benz, Audi and Honda to use the tires in their new cars. But it ignores another important partner in this enterprise ecosystem, the numerous car repair shops. Michelin did not consider the success or failure of this new type of tire largely depends on the support of the car repair line. In order to repair this new tire, the repair shop needs to purchase expensive equipment. Most car repair shops have neither such funds nor enough space. Moreover, after they made this major investment, the maintenance market for this new tire will take a long time to form, resulting in a long return period for their investment. Therefore, these car dealers have no motivation to participate at all. Without their support, this innovation, no matter how good, can't succeed in the market. The same is true of Sony's mistakes. When it launched the e-book, it only did not consider how to get support from other core members of the ecosystem, such as publishers and authors, from a product perspective. So, it didn't design a new business model around this radical new product. At the same time, as a hardware-based company, Sony has not been able to design a truly high-quality online bookstore for users to download books. The result is that publishers, authors and users have not accepted this new product, and its failure is inevitable. In general, companies will consider the cooperation of relevant companies that provide the corresponding accessories when they innovate. For example, in the high-tech industry, a product must contain hardware and software to form the overall product system that users need. Because of the high degree of interdependence between product hardware and software, a hardware company fully understands the importance of cooperation with other related software companies. But when the dependence between products or companies is less obvious (especially upstream and downstream support companies, such as services, distribution and retail), the introduction of innovative companies often ignores the importance of these related corporate support. Causes the failure of new products. This is the innovation myopia of the enterprise. Without eliminating this blind spot, it is difficult for enterprise innovation to truly succeed in the market. Johnson Controls, which produces electrical switches and sensors, is also well aware of this. It is the first to introduce a series of high-performance energy-saving switches and sensors that can significantly reduce power consumption, thereby greatly reducing the cost of electricity for commercial and general users. But in order to adopt this new type of switch, architects, electricians and other industry chain members need to adjust their daily work methods and processes, and they are not willing to make such changes. This directly led to the failure of Johnson & Johnson's new products. Today, more and more industries tend to be ecosystemized, that is, the traditional loose industrial chain structure is deeply integrated to form one or several symbiotic and coherent enterprise ecosystems. In this situation, if a company wants to launch a successful new product, it is far from enough to focus on the quality and performance of this new product, and it is necessary to manage the management dependence between related companies. The overallity of the ecosystem or industry chain examines the feasibility of this innovation and completely eliminates the blind spots of innovation. Therefore, the innovation of today's enterprises is not only a technical issue, but also a problem of managing the enterprise ecosystem, which is more challenging. For example, in the late 1990s, when Hollywood introduced the concept of digital cinema, it led the digital transformation of theaters in the United States through the launch of the highly successful film Star Wars, but only 5% of theaters have undergone digital transformation seven years later. The reason is very simple. To renovate the theater, you need to invest $70,000 on each screen. Hollywood realized that the cooperation of cinemas was important to the promotion of digital cinema, and finally adopted the method of providing subsidies to theaters to make this new technology popular. Professor Adner of Dartmouth College has proposed three methods to eliminate this blind spot of innovation. First, a company must clearly outline its own industrial chain, or the structure of the ecosystem and the location of all members, and from the user's point of view, identify all important partners in the ecosystem, especially downstream of the industrial chain. Those members of the industry chain who are in direct contact with the user. There are two types of important related companies, one is the upstream hardware and software supporting enterprise, and the other is the downstream commercial users. These business users must accept this new product in order to reach the end user, such as the car repairer in the Michelin tire case and the architect and electrician in the Johnson & Johnson case. These business users are often critical to the success of a new product, but are often overlooked. Second, identify and analyze all the risks faced by the new product in the process of successfully reaching the user, and rank these risks according to the importance of affecting the success of the new product to determine the core risks and the enterprises related to these core risks. Third, according to the value proposition of user needs, the smallest number of companies that can provide such value from the above enterprises is the most important enterprise in this industrial ecosystem to ensure the success of this new product. When a company conducts new product development, it has to take into account the needs of these companies. And when new products are introduced, the adoption costs and risks of these key companies must be reduced. Only in this way can we eliminate the blind spots of innovation and ensure the ultimate success of new products.  

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