Drop Error

There are two types of errors in New Product Development. A Go error occurs when there is a failure at any stage (but especially at the screening stage) in the new product development process when a decision is made to proceed with a product which, in hindsight, should have been abandoned. This is quite common and much publicised. In fact, the major cause for 90% rate in New product failure is due to a Go Error. Classic cases are Ford Edsel, Segway....

What is not so common, for reasons that these doesn't get into the public domain, is the Drop Error. A Drop error is when a mistake made by a company in deciding to abandon a new product idea that, in hindsight, might have been successful if developed. The opportunity lost more often than not resulted in altering the fortunes of the Company.

"There is no reason anyone would want a computer in their home”, opined Ken Olson in 1977. Ken was the founder, chairman and president of Digital Equipment Corp (DEC) that had originally developed and fabricated 64-bit RISC microprocessor, Alpha AXP. For an acute entrepreneur, he was way of the mark. He missed the bus and his company was taken over by Compaq and subsequently sold out to Intel.

Similarly, IBM, who were the market leaders in main frame computing, refused to accept the potential of desktop computing, whereby losing out on grabbing the market leadership. Though they reacted late, they were never the force in desktop computing as they would have been if they had the first mover advantage.

In the early 1920s, D. W. Griffith, the premier pioneering American film director had declared, “Speaking movies are impossible. When a century has passed, all thoughts of so-called speaking movies will have been abandoned. It will never be possible to synchronise the voice with the picture.” History was to prove him wrong.

The year was 1896. The acclaimed Irish mathematical physicist and engineer, Lord Kelvin, (after whom the Kelvin scale of absolute temperature measurement is named) was serving as the president of the Royal Society. With full conviction he opined, “I have not the smallest molecule of faith in aerial navigation [flying] other than by ballooning.” Well, the Wright brothers first flew in 1905 making a mockery of Kelvin's prediction.

“Its only a toy”, reacted Gardiner Green Hubbard, the founder of the National Geographic Society on seeing Alexander Graham Bell’s telephone in 1876. Gardiner happened to be the inventor’s father in law. Even Bell did not realize the commercial potential of his invention.

Rex Lambert, founding editor of the Listener (established by BBC) mentioned—“Television won’t matter in your lifetime or mine” in his weekly magazine in 1936.

The Beatles were rejected by The Decca Recording Company in 1962 saying, “We don’t like their sound too much like the Shadows, and guitar music is on the way out.” We know how much they lost out.

So, next time you come across a wild idea, evaluate it carefully