Choosing to take on a new business venture comes with a lot of uncertainty. The main objective of the project can be centered around learning and an equal amount of value can still be gained. This path may be right for you if:
- your company is facing an overall lack of innovative ideas
- promising projects continue to have disappointing results
- competitors are successfully capitalizing on internal innovations or ideas you abandoned
Oftentimes, the lack of success in new business development is rooted in management and evaluation issues. When management is focused only on the worthwhile outcome of new business, no effort is put forth to extract value from other outcomes deemed as failures. Lessons can be learned from projects that don’t meet goals or don’t mesh with strategy. Likewise, new technologies or capabilities can be gained from failed aspects of the project.
The main strategic flaw when undertaking projects like these is the go/no-go approach that involves forming a clear path and continuing through the stages only after a positive evaluation of each stage. This relies on meeting predetermined goals to decide on success. The problem is that people are unable to truly predict the future of business, so creating a plan that allows for adjustments along the way would be more realistic.
However, many companies are designed in a way that prevents this. A budget approval process forces a focus on the outcomes determined in the beginning instead of additional insight gained along the way. When it comes to a business venture, focus on all the doors that could be potentially opened and the value in those as well.
A “failed” venture could open the doors to several alternatives that could also derive great success. For example, reusing the business by directing it towards a new target market, forming a joint venture, adding a new business unit to your company, or making use of elements such as technologies, knowledge, connections, or equipment are all options for opportunities to undertake.
To improve the return on your investment, think of the venture like a scientific experiment that follows a scientific method. You are testing a hypothesis strategically and learning from the results to make changes before moving forward. If an initiative doesn’t work out as planned the first time, learn from the mistakes to make improvements for the future. This is what will ultimately create a successful venture; learning is key.
As a technology leader at your firm, you have the power to pursue the potential of your internal innovations. You can make others in the company aware of the opportunity for additional ROI, and use a strategic process focused on learning and adapting to increase the chances of success. Consider the unique software and capabilities your organization offers. If you see the possibility to make a profit, take advantage of the potential opportunity to develop a money-making machine.