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NEW RESEARCH | How to use failed innovation projects to your advantage – researchers advise
- Published: 12 Dec 2023,
- 9:09 AM
- Updated: 12 Dec 2023,
- 10:37 AM
Networks, skills and established procedures are examples of resources that can be reused from failed projects. Researchers can now explain how, and give their top tips for entrepreneurs who want to invest in new innovations.
Indulging in innovation projects is by definition a recipe for failure due to the inherent technical and commercial uncertainty. And the stigma around failure is high in most cultures.
– It discourages risk-taking and innovation, leading to a lower overall innovation capacity. So I was interested in exploring whether there are any resources from failed innovation efforts, beyond general lessons learned, that can be reused in new projects,” says Peter Popovics, Stockholm School of Economics.
Valuable assets
In his doctoral thesis, he focused on the benefits of failed innovations and was surprised to find several resources that can be reused.
– Technical expertise, professional networks, customers, former employees, existing product and service offerings and intellectual property rights are some of the resources that can be reused.
Recycled in two ways
Resources can be reused in two different ways. One is the reuse of resources without changing their role, function or form. Human resources such as skills and employees are examples, but also social resources such as professional networks and reputation. The second way to reuse resources is to use organizational resources – such as existing knowledge and skills – as catalysts to develop new business models, strategies, product offerings or strategic partnerships.
– Using already proven resources means lower costs and shorter time to market.
Quick restart the best
Human and organizational resources are the most reused, according to Popovic’s research. And resources from recent failed innovation efforts have been shown to be reused to a greater extent than resources from recent successful innovation efforts.
– But for the resources to have a positive effect on the new company, the project must be launched quickly after the failure. The value of reusable resources tends to deteriorate over time.
– Another exciting finding that surprised me is that resources are not only important building blocks, but also often the trigger for starting a new innovation project,” says Peter Popovics.
Contact peter.popovics@hhs.se
Three tips for entrepreneurs who have failed in a business and want to start a new one:
- In addition to evaluating the failed innovation venture in order to learn something, entrepreneurs should ask themselves what resources have we created and used during the project? Which ones can be reused?
- Keep in mind that some resources can be reused in their original form, while others are more suitable for developing new resources. Map out what applies to the different resources.
- Start the new venture relatively soon after the previous one. Pay particular attention to identifying human, organizational and social resources – they create more benefits than others.
More about the thesis
Peter Popovics recently defended his dissertation at the Stockholm School of Economics with the thesis Turning innovation failures into strategic assets: Exploring how novel innovation can leverage prior failure through resource reuse.
