If a business has been around for 5-10 years and it’s generally making money, there’s usually an established series of “cash cows” within the org — i.e. the things that actually make it the money. (Insert something about 80/20 rule here.) This is both a good and bad moment for a company; it’s good because hey, you’re making money. It’s bad because once you have cash cows, the idea of innovation or creating new projects/pipelines/etc. becomes limited. People want to focus on what’s working, and resources are limited.
For example, I worked at ESPN for years. ESPN is a big place and has a ton of money; it’s part of an even bigger place (Disney) that also has a ton of money. It’s not necessarily hard to get a new project going there, but … most people know the true money is coming from the cable subscription fees, so there’s a prioritization of resources towards all that, sure. This happens, at some large/small level, probably everyplace you’ve ever worked.
But how do you create urgency around a new idea in this situation? Well, thankfully there are a few approaches out there.
This article details a process of initiating a new product/concept at Redbox, and the basic breakdown is:
- Incentivize innovation: Essentially, reward people who think of new things that work.
- Set a protected budget: So that workflow can’t be routed back to the cash cow products
- Be material: Whatever you’re doing has to actually matter, or else no one will be invested in it
- Time Horizon: This is a big one I’ll address in a second
- Framework of Evaluation: How do you know if something worked?
On the time horizon one, well… that’s tricky. Most businesses, and all publicly-traded ones, are set up on a quarterly system. It incentivizes them to win, win, win but do it now, now, now. Oftentimes a new product or new project needs about a three-to-five year window to actually work successful and start producing value. That’s 20 quarters. That’s a lot of patience for some executives. I feel like the time window concept is always a problem with allocating resources correctly.
On the evaluation piece, Redbox used 20 metrics or something; that seems like too many. I’d honestly probably just ask, “Hey, did this make money? Did it make the amount we thought it would?” That’s typically all anyone really cares about.
If you look through those steps above, you can break the process down to this:
- Why would an employee want to do something?
- How is it going to get done, process-and-people-wise?
- Who is involved?
- What is the end goal?
- How will we know if we were successful?
It’s interesting that you can break most business ideas down into a series of core questions, right? But most of them, ala Simon Sinek, do need to lead with the why. If you start with the how, where’s the real buy-in?