4.7 Conclusion

Whether you want to bring cool new products to market or improve process capabilities, don’t forget, innovation is hard! Many product ideas, for instance, never make it to market. Others struggle to gain traction. For evidence, consider the following statistics.

• Nineteen of twenty pharmaceuticals that reach clinical trial fail—i.e., they never make it to launch!

• Thirty thousand new consumer products are launched each year. Ninety-five percent fail!

• According to Nielsen Global New Products report, half of new products fail to attain year one’s sales performance in year two. The “vast majority” vanish from the market within the first three years!

• Only 3% of new consumer packaged goods reach the threshold of a highly successful launch: $50 million first-year sales.

Even successful companies with great brand recognition and deep pockets suffer painful product failures. Do you remember New Coke? (see Figure 4.11)

Despite the challenges and costs, you need to make innovation part of your company’s culture and daily routines. Why, you ask? Answer: Because customers always want “new and improved.” If you aren’t capable of fulfilling their desires, your rivals will. Moreover, even when you bring “new and improved” to market, rivals will imitate—and often improve—your products within a year.

Your cool process improvements aren’t safe either. They will also diffuse to competitors—60% to 90% do. You need continuous improvement and constant renewel to stay ahead of the competition.

Let’s close with some good news. Lean Six Sigma can help you develop the creative, but disciplined thinking and processes you need to unleash your people’s curiosity and reward them for acting on their innovative impulses. Lean Six Sigma will also help you manage the end-to-end collaborative processes that high-leverage innovators rely on every day.