How To Make Sure Your Idea Doesn’t Suck Before You Waste A Million Dollars On It

Remember a few years ago when Netflix thought it would be a good idea to change the name of movie-by-mail division to Qwikster? It was a move criticized by Mashable as perhaps the worst product launch since New Coke. More than 23,000 people commented on a blog post by Netflix CEO Reed Hastings announcing the change, and most of those comments were ruthless in their criticism. After massive backlash, Netflix decided to abandon the changes.

The Qwikster scenario was likely a well-thought-out business decision that made sense within Netflix’s strategy for growth. However, the one group of people they apparently neglected to consult were customers. This ended up being the downfall of that decision, which caused a very public PR nightmare in the wake of the announcement.

It can be hard to know what constitutes a good idea until you see it in action, but there are some tried-and-true methods you can use to make sure the best ideas rise to the top. At FounderTherapy, we aim to be strategic about every move we implement. While we fully understand the threats of so-called “analysis paralysis,” we use a rigorous system to vet ideas. This process helps us and our clients make good decisions based on the information we have, and helps us decipher what additional information we need to inform any other decisions.

Here’s what we to do to make sure we don’t break the bank spending money on ideas that likely won’t be successful.

Ideas: A Primer

At FounderTherapy, we consider something an idea when it has a clearly articulated definition and is documented accordingly. We use Trello to organize ideas, and we try to offer as much description as possible on every Trello card so that even a reader who is unfamiliar with the product or business still has an understanding of what the idea could accomplish. For example:

Bad Product Idea Title: “Build Uber for dog walkers.”

Better Idea Title: “Build a product that allows pet owners to schedule dog walking services on demand while helping dog walkers be more efficient on their routes.”

The reality is that any idea that isn’t sufficiently documented will get buried. That’s why it’s important to use the right channels to document them, as opposed to having dozens of messages flying around on Slack, Hangouts, email or any other conversation medium.

Consider Alternatives

No idea is ever a sure shot. Sure, you might think that your approach to handling contractor invoicing solves all of your company’s internal issues with vendor payments. But, it’s possible you haven’t thought about how this change might impact your vendors.

This is why we recommend developing two or three additional ideas before deciding whether your idea is worth considering. Be thoughtful about the problem you’re trying to solve and try to make the ideas as unique as possible. This helps you examine the issue from all angles. In some cases this can be the catalyst to generate more ideas that drive even better solutions.

Once you have a collection of ideas, share them with your team members. If appropriate, include stakeholders at every level of the company, such as the technologists who need to implement the solutions or the assistant who will have to input data into a new tool.

Get More Feedback

If you’ve shared the idea with members of your team, reviewed alternatives, and have come to the conclusion that you might have a good idea on your hands, it’s time to share with people outside your team. These people may provide insights that you hadn’t even considered. Applying the example above, you may discover your vendors will have trouble applying the new approach you’ve suggested, which could cause more problems than it solves.

Don’t limit feedback requests to people you know and trust. Ask people outside of your circle for their opinions. They have little to lose from being completely honest with you, and their thoughts can help you be more objective in your idea analysis.

Some startup founders are scared to share their ideas, harboring a fear that the ideas will be stolen. But the reality is that this almost never happens, at least until the business model has already proven lucrative. Put simply, it’s too much work to steal an idea for a startup if there’s no guarantee of success. After all, an idea is just an idea, and what matters in building a successful product and business are the myriad details and smaller decisions that will make your path different from someone else’s, even if you start from the same place.

Know Your Goals

A great idea for the sake of a great idea is worthless. If you’re not honest about the goals you hope to achieve with an idea, you may accidentally find yourself executing on a costly idea that can actually harm your business. I recently heard about a team that scrapped a very expensive project because there was no alignment on what it was supposed to accomplish. In retrospect, it was not a good idea to develop it without a well-defined goal in mind.

It’s not always essential to identify the problem it solves before you start ideating around it. For example, if the idea is to start donating old office supplies to charity, it’s possible that this great idea was a result of a moment of inspiration. But, when you can apply it to your company goals, such as a cost-saving measure as a charitable tax write-off, then you’ve come up with a creative idea that wasn’t necessarily founded on a need to solve a specific problem within the company. These ideas can be just as useful as a list of cost-saving ideas that came as a result of a specific directive to save company money.

The Big Picture

In the product space, we’re forced to make decisions every day. Many times, we have great ideas about things that would be fun or interesting to the end user, but at the end of the day, we have to always carefully consider what’s going to help drive the business forward. The thing that helps service the business might not always be the fun, silly, creative idea.

We deal with this by defining how the product or feature idea fits into the business model as a whole. When we are very specific about objectives and we aim to align them with bigger business goals, we can more carefully craft a solution that services both the end user and the specific project objectives.

The Implementation Problem

Sometimes, we overcomplicate what we need to do in order to implement an idea. It’s true that some ideas will require years of restructuring and reorganization to implement. However, many ideas can be introduced into the world on a smaller scale, which can help the creator determine whether the scaled-up idea is actually worth implementing at all.

Considering the previous vendor example, let’s say your vendors are interested but want to understand how the solution might work in practice before fully committing to it. In this case, you might trial the idea on one project or with a single vendor, which has the benefits of allowing you to validate the idea while also working out any kinks should you opt to go for a bigger implementation.

On the product side, this might manifest itself as a feature, which can be implemented with the goal of learning how people react to the change. This allows you to gather information, data, and feedback on your approach and helps you vet whether your idea is worth pursuing long term.

Workload Constraints

Ideas often fail in execution. Because trying to activate ideas that never take off is wasteful, and because failed projects and ideas can cost lots of money and wasted time, we aim to be very careful in our approach to idea acceptance and execution.

We stress the importance of realistic workloads and take measures to help people avoid taking on too much. In a future blog post, we’ll talk about the steps we take at FounderTherapy to ensure we’re not biting off more than we can chew with our workload. But for now, keep the following in mind:

• Build more time into your project plan than you think you will actually need. Some companies calculate delivery dates by evaluating team members’ time estimates and doubling them.
• One in, one out: Every time a new project pops up, take one off your plate. Otherwise, you’ll have dozens of open projects that are never completed.
• Hold someone accountable. Without accountability, projects aren’t completed.

Resource Requirements

When it comes to executing an idea, one of the most pressing questions is whether we actually have the resources to do it. If we always say “no” to this question, we’re seriously jeopardizing our ability to innovate and take amazing strides in business. But, we have to be realistic about what kind of resources we will need in order to succeed.

We have no idea if a project has a real possibility of success until we see it in practice, which is why we always have to try new things. But, because we know it’s not economically sane to throw away tons of money on a project that won’t succeed, it’s important to set our expectations around the idea so we can realign if the project isn’t moving toward some level of success.

This is why we take the time to effectively plan before we implement any idea. Typically, we tackle one thing at a time and analyze the smallest steps that can make a major impact. We figure out who, exactly, needs to be involved in the process and evaluate their workloads to ensure our team isn’t stretching the limits of its capacity. If implementing the idea seems like too much, we’ll analyze how to reduce the project itself, or we’ll evaluate whether it’s worth dropping something else in order to try the new idea. Sometimes we’ll postpone it and reevaluate when the team has more bandwidth.

Some companies address these issues by allocating a set amount of time to a given project. They’ll give an idea their all for a set number of days, and then make a decision as to its viability and as to whether to continue. Even if they opt not to move forward with the idea at that point, the teams involved often have excellent learnings that they can incorporate into future projects. This blog post provides a great example of the process in action by the product team at Basecamp.

Sunk Costs

It’s hard to decide when it’s time to call it quits. However, sometimes costs can spiral out of control so significantly that the potential benefit is unlikely to be anywhere close to the amount spent. Often we think about expensive projects with the mindset that because we’ve spent so much already, we should just continue to spend until we can get something — anything — out of it. Or, we decide that just because we spent money on a new piece of software, we should make use of it even if doing so isn’t actually in the best interest of the company.

It’s hard to avoid the sunk cost fallacy, and as humans, we fall victim to it every day. However, simply being aware of our biases are a step toward making sure we don’t continue to invest in ideas that have proven that they are not useful. At this stage, it’s important to either pivot or give up entirely.

Bringing It All Together

Great ideas are essential to the success of your company. However, just having an idea is not enough; it’s important to ensure it’s a good idea that services your company’s bigger goals. These are merely a handful of tactics you can use to vet your ideas so the best ones rise to the top.

Because startups thrive on innovation, it’s important to make sure we’re constantly pushing ourselves to come up with creative ideas. As long as you recognize that not every idea is a great one and that there are many things you can do to evaluate and prioritize ideas, you are cultivating an environment where the best ideas thrive.

FounderTherapy helps founders build better businesses. Visit us at www.foundertherapy.co to learn more about how we can help you grow your company.

Originally published at foundertherapy.co on March 21, 2017.