The Big Miss: What It Is and How to Avoid It

The Big Miss is a phenomenon that occurs in larger companies. It’s what happens when a new organization forms around a new product or line of business that ultimately fails in the marketplace.

When investment and expectations exceed the project’s ability to deliver, what you have is a Big Miss.  

In the best case, a Big Miss results in a significant disruption in the lives of the people involved – as well as a large financial loss. At worst, it’s a fatal blow to companies with weaker balance sheets.

With so many smart people working on such promising projects, how can these disastrous Big Misses come to pass?

The roots of a Big Miss lie in the tendency of large companies to avoid fear and uncertainty. Large organizations usually value and promote people who can take an uncertain environment and create clarity and certainty.  Such certainty is valuable for customers and investors, and can even be useful for employees working in established branches of the company.  The problem is that when this demand for certainty is projected on new and developing spaces, it creates distortion and illusion.

When people are afraid to take the chance of doing something new, it’s comforting to have a familiar structure around you, and the illusion of stability. This comfortable structure — in the form of a highly-developed organization and a big team — numbs the fear, and the resulting business model is not rigorously vetted.  The seeds are sown for a Big Miss.

Facing this fear is where the juicy learning occurs. Building a big team just blunts the urgency to remove risk.  

I have been on both sides of this line as both a participant and leader.  On one program, we added people ahead of sales and so I wound up un-staffing over the course of a few days, helping people get new jobs. On other breakthrough programs, we fought endlessly for a budget and resources to complete the next deliverable.

Warning Signs You’re Headed for a Big Miss

Here is a typical scenario that is playing out in corporate America as we speak:

A historically successful organization sets up a new team in a new business model.  Optimism is supreme and C-level sponsorship is secured.  Senior staff is appointed, mid-level leaders are drafted – the best and the brightest are recruited internally and externally to the the new team.  There is enormous effort expended, with tasty glimpses of progress and visionary presentations to the chosen few.  There are press releases and analyst interviews, sexy marketing launches and large international supply chains.

Then, when results do not show up to support the hoped for future, the project is either killed quietly or implodes publicly.

Here are a few examples, both past and present:

All of the above products are examples of the Big Miss — too much investment with too little outcome. Sometimes companies are able to learn from their failures and use them on the road to bigger and better things or individuals are able to take the knowledge and run with it independently. As an example, check out this video from a member of the Apple Newton team and the amazing work she is doing now.

Unfortunately, the more common result is that these projects fade into obscure memory as companies either fold or move as quickly as they can to put the embarrassing episode behind them.

While a Big Miss can be a valuable learning experience, clearly most companies would rather not fail in the first place. So how can you structure your new innovations to avoid becoming the proud owner of a Big Miss?  Here are a few warning signs to watch for.

4 Warning Signs

  1. Assumptions. Big Misses are often fostered by companies that are large and have been previously successful in their core markets.  It is assumed that their success will map to the new endeavor.
  2. Big investment, early. Leaders are compelled to make it big before they make it solid.  In other words, the pressure to go big with people,money and facilities outran the validated performance of the product or service.  This can be partially due to a rewards system that is heavily biased toward rapid growth of organization and spending.
  3. Clones. The parent organization felt the best way to do breakthrough work was with a “mini me” organization that looked like a clone of the core organization.  Little copies of core organizations are huge parasites. Startups are business model discovery machines, not little businesses.  The skills involved in doing careful business model experimentation are very different than those to operate a large scale enterprise.
  4. Money trees. When there’s a “money tree” in the form of a government subsidy or a core business portfolio that allows lavish spending on a yet unproven business, it’s ripe for creating a Big Miss.  Although it looked for all the world like a real business from the outside, there was no sustainable value engine.  We know big money kills innovation.

Turning a Potential Big Miss Into a Big Win

If you’ve read the list above and you’re seeing warning signs in your organization’s current projects, what can you do to change track and help turn the tide from a Big Miss to a Big Win?

In order to turn the tide, you need disciplined leadership, and a culture of ruthless honesty in going after the weak spots in your offering.  Shoring up the portfolio decision making process to be constantly moving from intuition to fact is key as well.

7 Strategies for Avoiding the Big Miss

  1. Appoint an innovation project leader who is seasoned enough to not build a big team before it’s needed.  You need someone who has the reputation and ability to use a smaller team of commando-like troops and does not need the ego gratification of a big org chart.
  2. Have them report to an executive sponsor who understands that there will be experiments that don’t pan out on the first try.  Worthy experiments that disprove a section of your business model are invaluable — and skillful leadership knows how to reward shrewd and laser focused research that saves countless investment dollars.
  3. Use the latest tools.  There has been huge progress in lean startup, business model design and analysis, customer ethnographic and analytics that were not present even just a few years ago.  Don’t assume your current core products tools will effectively lead you to the next space.
  4. Set rewards for those who learn the most for the least – reward ingenuity.  If poking and mining the Twitter-sphere can save $50k in customer focus groups, go for it.  Reward people who get up and go outside the walls of the conference room to bring in new and insightful information.  Use a mixture of well executed, lightweight tools rooted in social media in addition to well designed face to face work.  Correlate feedback and be ruthless in drill down.  There is no such thing as an outlier at this point in the program.
  5. Set a fixed investment at the outset for the establishment of the business model.  Skillful organizations in this space set up tranches of funding that are only released on specific, validated and measurable success.  A great strategic CFO resource who is appropriately stingy and spendy at the right times is invaluable.
  6. Hire an outside expert or team who has a track record of telling the truth.  The pressure for conformity inside large organizations is enormous.  Hire a great critic, one that is not only critical but constructive – the return on this investment is huge.
  7. Keep your eye on the prize.  The goal is to build organizational muscle for serial innovation – not a one-hit wonder.  Taking the above steps will lead to a culture of openness and experimentation that will start you down the path.

Ultimately you want to build an organization where there are immensely motivated teams taking big risks with high support…in measured financial terms relative to the core enterprise.

If you found this helpful please send me an email or tweet me your thoughts.

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