During the creative process opportunities have to be ranked and evaluated so that decisions can be made about where to expend resources. The danger here is in creating a ranking system so simplistic that critical small ideas never receive focus.
Determining market size and sales opportunity is a natural part of this process. Developing filters to help managers make quick decisions streamlines this process and helps focus human capital. Large organizations often create a cut-off point – “No ideas under $20 million.”
The difficulty with this simplistic approach is three-fold. First, truly breakthrough ideas are very difficult to size correctly. Second, sometimes strategically you’re better off firing 5 small shots at a market than one cannonball. Third, it reduces motivation for employees to explore ideas of anything less than obvious potential.
I’ve addressed the difficulty customers have in comprehending their need for breakthrough products (CFE #3) and therefore your ability to size a market, so I’ll just address the strategic issue here.
Strategically there are three primary reasons why multiple smaller markets may be better for an organization:
- Obviousness – If the huge idea is obvious then competitors are already gunning for the same space. Your chance of success is probably being over estimated. Smaller ideas may allow you to surround competitors and pick off more profitable sales.
- Definition – Your organization seems to be bubbling with exciting, creative apparently tiny ideas but only has a few big, kind of boring opportunities to choose from. Do you go with big and boring or small and creative? Your company is defined by the products and services it delivers. Your employees are motivated by the results they see. The strategic power of defining yourself through creative, unexpected solutions can lift your entire business.
- Resources – This one is pretty obvious – but you might be surprised how often it is missed. You just can’t seem to find that big $20 million idea that makes sense. Hmmmm, four $5 million ideas can provide the same level of growth!
Employee motivation concerns is also of key importance. A thumbnail target used by the president of a company quickly becomes the only evaluation tool used by your staff. Small ideas have no chance of gaining traction because every management level knows they have no hope of being funded. What’s the danger in this? Seems efficient? How many huge ideas jump out of the cosmos fully formed. Focusing on the need for only huge ideas will stop the development of creative huge ideas!
In other words: Most big ideas start off small. If you kill small ideas too efficiently – no more big ideas.