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Add Profitable Business Model Innovation When You Don't Have Many Successes with Innovation Tests

Jun 5, 2008
With only a few successful experiments, you won't get far in creating and establishing an improved business model. You need to diagnose why you have had few successful tests.

The most likely problem is that you are not running enough tests. Few organizations are. If you have lots of ideas to test, this may mean that you don't have enough people with the skill and interest to run tests. If so, you need to change staffing and assignments to create more time for these critical innovation tasks.

Some companies will find that they are running lots of tests, but don't find any successes. This usually means that the quality of the testing is poor. In other words, you need to check to see if good ideas are being poorly implemented.

Finding this problem is usually a sign of an organization that is overloaded with tasks, or has people without all the necessary skills running the experiments. Examine what went wrong, and figure out how you can fix it. If you have these concerns before the testing starts, have someone with expertise in these areas evaluate the proposed tests and the availability of skills and tools to execute those plans.

One way that Paychex has ensured its ability to make many successful business model changes is by bringing into its top management executives who are experienced in performing many different functions. Tom Golisano, the company's founder and former CEO, looked for people with greater breadth of experience and psychological flexibility than is usually seen for the functions they head. In many cases, these executives came to Paychex after having succeeded in much larger organizations, as well.

Each senior executive had the ability to put together world-class tests and make them work, as a result. The difficulty of implementing a successful test throughout Paychex is always on their minds during the testing. The top management spends a lot of time together working on business model innovations, and as they do, each functional head becomes more and more aware of how the expanded demand affects all of the other functions.

If you don't have this sort of team, especially in a small organization, consider getting an unpaid board of advisors comprised of recently retired executives with varied functional backgrounds to play the same role. If that's not available, contact any of the organizations that provide free or low-cost consulting to entrepreneurs.
About the Author
Donald Mitchell is an author of seven books including Adventures of an Optimist, The 2,000 Percent Squared Solution, The 2,000 Percent Solution, The 2,000 Percent Solution Workbook, The Irresistible Growth Enterprise, and The Ultimate Competitive Advantage. Read about creating breakthroughs through 2,000 percent solutions and receive tips by e-mail by registering for free at

http://www.2000percentsolution.com .
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