The doctors Semmelweis failed to convince were reacting much as people from every way of life generally respond to a challenge to their assumptions. It seems to be human nature to reject new knowledge that contradicts long-accepted norms. In any contest between strongly held beliefs and the data, the data loses.
You know the expression, “I’ll believe it when I see it.” The Semmelweis Reflex inverts that: “I’ll see it when I believe it.”
When it comes to improving the odds at launch, the implications of the Semmelweis Reflex are enormous. People find it remarkably easy to dismiss or ignore the data that demonstrate how fragile and risky launches are. As if intoxicated by their own sense of self-confidence, they plunge ahead, often committing many of the same mistakes that have doomed countless launches before them. They end up adding to the dismal failure statistics.
So how do you get people to see something they don’t want to see? One technique that can be helpful when organizing a launch effort is this one: Rather than performing the traditional postmortem on a failed project, try a premortem before the project starts. Here’s how it works.
If you gather a team of experienced leaders and ask them why past projects failed, the explanations flow readily: The project was bigger than we realized … we were too slow … our design was flawed … we were operating from faulty assumptions … the market changed … we had the wrong people … our technology didn’t work … our strategy was unclear … our costs were too high … our organization sabotaged us … the competition was tougher than we thought … we reorganized ourselves to death … we fought among ourselves … our strategy was flawed … our strategy was good but our execution was lousy … we ran into unexpected bottlenecks … we misunderstood our customers … we were short on resources … the economics didn’t work … we got killed by internal politics …
Unfortunately, most teams never create such a list at the start of any project. That’s not in the genetic code of most innovators, who are (and who need to be) gung-ho optimists. But what if you ask your team to imagine a failure in advance, and explain why it happened? Research by Deborah Mitchell of the Wharton School, J. Edward Russo of Cornell, and Nancy Pennington of the University of Colorado found that “prospective hindsight”—imagining that an event has already occurred—increases the ability to correctly identify reasons for future outcomes by 30 percent.
Gary Klein, author of Sources of Power: How People Make Decisions and The Power of Intuition, builds on this “prospective hindsight” theory. He suggests that a premortem exercise frees people to express worries that they might otherwise suppress for fear of appearing disloyal or undermining the team’s confidence. Klein says the process reduces the kind of “damn-the-torpedoes attitude often assumed by people who are overinvested in a project.” People participating in a premortem might raise red flags before, rather than after, failure.
So try this nightmare exercise: Imagine disaster. Ask why you failed; list all the possible reasons. Then do your best to counter those mistakes before they have a chance to occur. Most launches die from self-inflicted wounds. It means that if you’re willing to take a clear-eyed look at the forces seemingly conspiring to derail your next launch, you’ll probably find that the most powerful factors are actually under your control.
AMONG THE BEST at confronting and dealing with the realities of launch have been the leaders of the Toyota Prius project—Takeshi Uchiyamada, Takehisa Yaegashi, and the other members of their team. They knew the odds of success were less than 5 percent. They didn’t avert their gaze from this dispiriting fact. But then they asked the critical question: How can we change those odds?
To begin, they created a dramatically different organizational system—almost a company within a company—to design the new vehicle.
The system started with a physical space. A room at Toyota headquarters was set aside for the project. They called it obeya, the big room. It was equipped with some personal computers and two computer-assisted design workstations. Team members assembled in this room daily to collaborate on the Prius project—the first time this had been done at Toyota. The idea was to raise the odds of success by getting all the relevant talent working together, sending off creative sparks and generating an intense sense of focus.
A virtual space was also created as a powerful supplement for the physical space of the obeya. Uchiyamada had an electronic mailing list compiled to encourage the team members to quickly and broadly disseminate key issues and problems as they arose. Rather than channeling issues through the usual hierarchical, command-and-control communications model, the innovative e-mail system encouraged everyone, no matter their job title or departmental assignment, to offer a solution to any problem they heard about. The clear message: The best minds throughout Toyota were to be intensely focused on any and every problem related to the new-product development process.
As the project grew, more and more of the company’s most brilliant thinkers got drawn into the increasingly fascinating and important set of challenges it posed for engineering, design, manufacturing, distribution, and marketing. In the end, a phenomenal two-thirds of Toyota’s entire prototyping resources were devoted to the Prius.
Uchiyamada also introduced other organizational innovations designed to intensify the company’s intellectual focus on the Prius project. For example, when a new vehicle is ready to go on line, Toyota usually sends resident engineers (REs) to work at the manufacturing plants so they’ll be available to handle any problems that arise during the early months of production. For the Prius project, they assigned reverse REs from the manufacturing plants to take part in the design development process. This was a form of premortem, a way of identifying possible manufacturing glitches even before the car was ready for the assembly line and eliminating them in the blueprint stage.
Other great demand creators have also recognized the necessity for organizational innovation as a prelude to a successful launch. Jeff Bezos didn’t hand the Kindle project over to a working team within Amazon; instead, he created Lab 126 so this unique new venture could be developed with the clear focus and fresh, independent thinking it demanded. Helmut Maucher of Nestlé made a similar move when he created a separate skunkworks to shepherd the Nespresso project through the harsh reality of an unproven market for home espresso machines in the 1980s.
Another odds-raising innovation used by Toyota involved “accelerated evolution”—creating a plethora of varieties (“mutations”), subjecting them to tough-minded competition (“external pressure”), and then selecting the very best design options (“natural selection”). Toyota tested some eighty different types of hybrid engines early in the life of the project. Through extensive computer-based testing, the engineers at Toyota narrowed the eighty possibilities down to eight, then to four (it took months). Then they had an intense bakeoff among the four. The survivor of all these brutal comparisons was a highly evolved and tough engine.
A similar accelerated evolution was applied to the car’s overall styling. Toyota maintains seven separate styling studios, each normally working on a different vehicle category—small cars, trucks, minivans, and so on. But for the high-stakes Prius, all seven studios were asked to submit designs, which were judged by a panel of fifty people of various ages.
And all these innovative steps to increase the odds—in addition to a series of unprecedented technical breakthroughs—were conceived and implemented in record time. (Speed itself is another odds-raising move. Every additional month a launch slips creates new opportunities for the market to shift, for competitors to make preemptive moves, for technologies to change, for customer tastes to evolve in a different direction.)
Two years into the process, Uchiyamada and his team presented Toyota’s new president, Hiroshi Okuda, with their projected completion date for the Prius: late 1998 or early 1999. Okuda quietly overruled them. The Prius needed to be on the market by the end of 1997.
Uchiyamada would later describe his consternation in understated Japanese
style: “I have to admit that we were against the decision. Our team believed it was too demanding.” But then they returned to the obeya and set about implementing it. In the end, the Prius NHW10 was launched in Japan in October 1997—two months ahead of Okuda’s impossible schedule.
The Prius NHW11 was introduced in the American market in 2000, seven months after the Honda Insight. At first, sales lagged. Toyota seemed to be succumbing to exactly the same law of failure as Honda had.
However, Toyota didn’t stop. It kept redesigning the car, improving its efficiency but also going beyond the functional to the emotional. It created a new design that stood out, that let everyone know it was a Prius, not a Corolla look-alike—which meant highlighting the green sensibility and forward-thinking mind-set of the driver. The new model was launched in 2004, and sales took off.
Today, nearly half of Prius’s worldwide sales come from the United States. And in 2009, sixteen years after development began, the Prius became the bestselling car in Japan for the first time. By managing the launch process differently, Toyota found the demand that Honda didn’t.
The Toyota story also illustrates a truth that all the demand creators recognize: the power of second chances. Like the Prius, many new products don’t create significant new demand when they first enter the marketplace. But great demand creators keep talking to customers and redesigning. As a result, their products often reach escape velocity on the second or third try.
Many great products are built on a solid foundation of failure—but it must be organized failure, as Toyota and other launch masters exemplify.
LAUNCH IS a mind game. Success and failure hinge on how people think, and the degree to which they can overcome business as usual—and the innate proclivities of human nature. Great demand creators, like Uchiyamada and his team at Toyota, have developed a complete array of distinctive mental habits that distinguish them from most launch practitioners.
We’ve identified seven of these habits that appear to have the greatest impact on the odds of a successful launch. Let’s consider them one by one.
1. The first is the instinctive drive to conduct a fatal flaw search, seeking out the crucial weakness (or the two or three crucial weaknesses) that will undermine a business design and kill the value of a launch. Examples of such flaws include the misunderstanding of American grocery shoppers’ attitudes toward price on the part of Fresh & Easy, or the excessive cost of most of the eighty different hybrid engines that Toyota tested, or one of the early envelope designs at Netflix that made the DVDs prone to loss or breakage.
The Netflix team achieved a successful launch in part because the DNA of their style of thought incorporated this drive—in spades. For that reason, they were obsessive about searching for the best solution to the shipping problem, even after they’d tried and tested scores of reasonably good versions.
Finding the fatal flaw early—once, twice, or even several times—is a key step in practically every successful launch. If you find it and can fix it, fix it. If you find it and realize that you can’t fix it, it’s time to ask: “Should the launch proceed?” And if the honest answer is no, then shut it down.
Unfortunately, this is the opposite of how we ordinarily think. The genetic code of business as usual conditions us to look for confirmatory evidence—data that suggests we’re on the right track. That’s human nature, isn’t it? The Semmelweis Reflex. Success at launch requires us to recognize that reflex—and take conscious steps to reverse it.
2. The second habit practiced by great launch masters is competing inside the organization. The idea is simple: Make accelerated evolution work for you. Create meaningful variations and have internal groups or alternatives compete, then select the strongest to compete in the outside world. It’s the thinking behind Toyota’s excess-options program for the engineering and design of the Prius.
In similar fashion, Apple’s designers create ten pixel-perfect, unambiguous mockups of every feature for each new product. Their goal is to produce many very good, yet very different, implementations of the idea. Using specified design criteria, these ideas are narrowed down to three options. These three options are developed and perfected in parallel for months. One final option is ultimately selected for production.
This means that Apple throws away 90 percent of its design work. Wasteful? Not really. This system gives Apple’s designers enormous latitude for creativity that breaks past traditional organizational and psychological restrictions. When you know that the design you are crafting is one of ten rather than the one, your willingness to cut loose and try something a little wild—and perhaps a little brilliant—is that much greater.
Competing internally requires a large pool of variations, and an unreasonable degree of iteration. But it is that endless iteration that leads to perfection—and is quite contrary to the business-as-usual genetic code, according to which organizations compete externally only.
3. Masters of launch understand the value of imitating to be unique. This refers to the selective role of innovation in the work of launch masters. Great demand creators don’t innovate in everything. Instead they lavish creativity on the most critical variables; everywhere else, they borrow and steal shamelessly. They follow the dictum (often attributed to artist Pablo Picasso) “Good artists borrow; great artists steal.”
The reason is simple: When you’re running a launch, there is never enough time, money, talent, or emotional energy to analyze, master, and control all the thousand-and-one details that you have to get right to create significant demand. This is true even when a major corporation like Toyota or Apple is involved. After all, even a big company is really made up of a thousand tiny budgets—a million dollars here, half a million there—each of which is run by a manager who is under scrutiny and pressure to be as cost-effective as possible. And of course the smaller organizations most of us belong to, from a mom-and-pop stationery store or a local art gallery to a fifty-person tool-and-die maker, are often operating at the edge of solvency with little or no room for waste.
So investing resources in reinventing the wheel is a formula for failure. This is why great demand creators ruthlessly prioritize the handful of crucial elements when planning a launch and invest their resources in those. Everywhere else, they creatively recycle, reinvent, and reuse and so save money, time, and effort. Shakespeare didn’t invest time and emotional energy to invent a fresh plot for Hamlet; he borrowed the story from a thirteenth-century history chronicler named Saxo Grammaticus and devoted his energies to developing profound character insights and soaring poetry in which to express them. Developing his first movie on a stingy budget, Orson Welles rummaged the back lots at RKO in search of old sets, props, and furniture he could adapt to his purposes, concentrating his efforts on developing an audacious script and eliciting brilliant, unconventional acting from a company of relative unknowns. The result, as critic Pauline Kael explained, is an epic historical drama produced at a fraction of the normal cost—Citizen Kane.
Following the same principle, because Uchiyamada and his engineering team at Toyota knew they had a near-impossible array of technical problems to solve in designing the hybrid Prius, they opted to use the familiar and successful Corolla body design rather than creating a brand-new platform from scratch. They also collaborated with Matsushita on the crucial battery design rather than trying to develop it in-house. Netflix used some similar moves, emulating Amazon’s website rather than designing one from scratch and partnering with Sony, Toshiba, and Panasonic to generate awareness about its new business model and build its customer base.
4. Great demand creators always remember to emotionalize the offer. We generally behave as if customers and their behavior are rational. But the truth is that soft and fuzzy elements—emotions, impulses, urges, tastes, aesthetics—are often what separate winning offerings from their almost-but-not-quite-equally-cool competitors. Emotionalizing your offering turns “very good” into “magnetic.”
Zipcar started off promoting itself a
s a “car-sharing” service. Problem: Nobody really wants to “share” a car. Zipcar got traction with customers when it began promoting its super convenience instead. Who doesn’t love convenience? Honda engineered a great hybrid—but nobody fell in love with it the way they fell in love with the Prius. Sony produced a technically wonderful electronic reader—but it didn’t excite people the way the Kindle did. The ZEN music player was nice, but the iPod was cool. Nokia made great smartphones for years, but the iPhone turned people on.
Product design is a powerful emotional trigger. That’s why, when Samsung wanted to vault past Sony and Matsushita in the world of electronic devices, it tripled the number of designers working on its products. What’s more, it officially gave the designers precedence over the engineers—a gutsy move for an engineering company.
5. The fifth mental habit focuses on the unique organizational equation. This means looking for the managerial, structural, and communications strategies that are especially appropriate for this launch, at this time, under these circumstances. It’s an important corrective to the business-as-usual genetic code that generally leads people to employ their existing organizational structure as the default choice, even when a launch project that absolutely demands organizational innovation is under way.
At Toyota, for example, a successful launch for the Prius meant, among other things, creating the obeya, harnessing two-thirds of the company’s design capabilities to the Prius project, and creating reverse resident engineers to solve manufacturing problems in the design phase, long before those problems even had an opportunity to take shape.
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