Why Do Innovations Fail? Learnings from failed innovations : 1: SEGWAY

According to Clayton Christensen, who wrote the Iconic "Innovators' Dilemma", more than 30,000 new products are introduced each year, and 95% of them fail.

This 95% failure rate is touted across many forums and magazines and by industry leaders.

And, some of these failures are not just "also ran" products. There have been products behind which huge monies have been bet and yet they have failed spectacularly.

Understanding how these products failed can give us great learning.

Let us start with SEGWAY.

This product which was as iconic as it can get. An invention behind which great brains such as Steve Jobs had bet huge amounts of money. And yet, it failed.

The Segway Story

Segway was founded in 1999. It was the first to be marketed with "self balancing" technology. By 2001, the company launched the "two-wheeled personal transporter". Given the hype around it and its initial success, its success was a foregone conclusion at that time.

But, it was not to be.

Segway sold just 23,500 units in the first 5 years. Just double of that by 2009. Dean Kamen, who had spent quite a fortune developing the product, sold it off to British milionaire and inventor, Jimi Heselden.

But, the new owner, Jimi Heselden, tragically fell off from a cliff face and died while riding his Segway just 10 months after the acquisition. This high profile case drew unwanted attention on the product and showcased its limitations.

The invention and the beginnings:

Cut to Jan 2001.

News was circulating that an incredible invention has been developed and it can change the world.

Steve Jobs was found saying that the invention would be “as significant as the Personal Computer.” Jeff Bezos was quoted saying it was “revolutionary.” John Doerr's VC firm made substantial investments into the technology.

None of the above should be surprising given the aura surrounding the invention.

But, the really surprising thing - as the world learnt later on - was that none of these people knew fully well about the invention.

The invention was surrounded in mystery. The invention was just called as "IT" reverentially. Till "IT" was unveiled to the world in Dec 2001.

When the world saw the product, as unveiled by Dean Kamen, all the aura seemed to vaporize.

The owner's obsession with secrecy and developing the product in secrecy ended up stunting the development of the product.

The huge expectation which kept building on the invention was too much for the actual product to cope with.

Details of the invention:

Segway was invented by Dean Kamen. The word Segway comes from the word “segue” meaning “smooth transition from one thing to another.”

Segway uses 5 gyroscopes. A 'gyroscope' is basically a mounted rotating wheel and it’s axis that are free to turn in any direction. This helps Segway to obtain “self-balancing”.

Segway also has tilt sensors that monitor the user’s center of gravity 100 times per second, giving the rider a feel that they’re gliding through.

It typically weighed about 30 kilos. It was touted as capable of going upto speeds of 20.1 km/h. It was electric powered.

And, yet, against all of these expectations - it still failed.

The product was very cleverly built. It worked reasonably well. The company, had lots of funding . And, yet, it failed.

Why did it fail? Some Lessons: 

Very high expectations:

It was supposed to be the "future of transport". It was supposed to be the "next PC" on the invention scale. All of this hype was continuously built up just before its actual launch.

When the actual launch came and the world saw the product, the reality just could not match the built up hype.

What was the problem being solved?

It was an innovative product. Yes. But, it was not clear as to the problem it was trying to solve. Wat is solving the problem of "short commute"? Say from the entry doors of office to the actual office buildings? Was it solving the problem of travelling on the road? Should the pedestrians use it instead of walking? What was it solving for?

There was no clarity. Instead, it seemed that the company promoting the product was trying to position it as an answer to "all kinds of travel problems".

Segway tried to be everything for everyone. Ultimately, it was not anything for anyone.

No clarity on who was the target customer

Who was the target consumer? There was very little clarity on that too.

Was it the person who was riding a two wheeler? Was it the pedestrian? Was it older people? Was it youngsters to show off "cool quotient"?

Who really needed it? No clarity there either.

It was not having the eco system

There was no "eco-system" available. It was not clear as to how to charge it. No clarity on where this can be parked. No clarity on how to use it on roads or sidewalks.

Those who bought the initial set of Segways had no clue to any of the above questions. Nor did the company try to address them before going full speed on production.

Priced high

Given the 'secrecy' surrounding its development, no "price discovery" was made. No consumer understanding of whose problem is it solving and how much will they be willing to pay for - was "discovered" - and subsequently it was priced very high.

Lack of consumer feedback hurt its design

Given it was developed under secrecy, there was no consumer feedback which went in as input into the design development process. So, the early prototypes did not have the benefit of having user feedback. So, when it was launched, consumers did not actually like the way it looked.

Regulatory issues

In many countries, it fell foul of traffic regulatory issues. It was banned from sidewalks. It was also banned on roads simply because it did not fit any existing categories.

Again, the promoters who thought of the technology (the self balancing gyroscopes and tilt sensors) did not think through from the regulatory lens or the legal lens.

Not designed well

The accident of Jimi Heselden was not an isolated case. There were other cases where people using Segway crashed. But, their crashes were not as fatal. The product needed customer feedback for its development which it sorely lacked, resulting in bad design.

It was too small. It did not have the height of a normal two wheeler and hence it was impossible to be spotted by the bigger vehicles on the road. It was said by some that it was a miracle that the truck drivers missed the Segway drivers on the roads.

Summary of Learnings

Segway is a story of great invention but which failed because the other aspects of developing and commercializing that innovation were not at all given any focus by the inventor.

The fear of the technology behind the invention being copied by the competitors drove the inventor more than the need to understand the consumer feedback.

That fear drove the entire development process. The whole design development was devoid of consumer feedback. Basic design elements and safety were missed. The legal and regulatory angle was not even thought of. The customer challenges of how they will charge it, where will they park it, how will they ensure they drove it safely - none of these were thought thru.

An invention is just that - an invention. But, for it to be a commercial success, a lot more than just inventiveness is needed. Consumer feedback - the bedrock of any commercial success was sorely missing - which resulted in a hugely missed opportunity for Segway.

Here are a few lovely books on innovation and how one can go about it.

1. Jugaad Innovation: A Frugal And Flexible: A Frugal and Flexible Approach to Innovation for the 21st Century

This is all about indian jugaad and how it works. A must read!!

2. THE ART OF INNOVATION by Tom Kelly

Lessons from IDEO - the iconic design firm. Great lessons indeed!

3. The Innovators Dilemma: When New Technologies Cause Great Firms to Fail by Clayton M. Christensen  

From the GURU of innovation. How success becomes the seed of failure. How great, successful companies find it difficult to cope up with disruptive changes in technology. How best business practices such as benchmarking the competition can often become the stumbling blocks towards success.

A must read!

Last week's question: What is the one habit that you would like to have - which will become the foundation for all other habits?

Somebody asked me this question - which in turn I asked you. My answer was a very simple "Reading Habit".

I thank my parents for inculcating the reading habit in me. They gave me books, books and even more books for every single occasion. They gave me library memberships as present. Encouraged me to read - it did not matter what I read. And, as I read, I figured out what I need to learn. I figured what habits would help me better.

So, my foundational habit has been reading. That has lead to other good habits.

What is your foundational habit? Please do share!

This week's question:

What's the one action that moves the needle more than 100 other actions? What's the one choice that renders 1000 other choices irrelevant?

James Clear had asked this question in one of his newsletters. Beautiful question that got me thinking.

Would love to hear from you.

Please do share your answer!

This week's quote:

“Be yourself; everyone else is already taken.” ― Anonymous