increasing the potency of ideas,
lowering the cost of commercialization, and
improving the success rates.
Investment dollars and project mix tend to be skewed toward small-increment product extensions rather than breakthroughs.
Areas of heavy investment are often the least productive.
External sources for ideas deliver higher returns.
Termination rates for unsuccessful projects are too low.
Unfocused budgeting criteria often lengthens payback.
Actual prioritization of projects is sporadic.
The Denominator Trap: Many companies greatly overestimate their ability to access and switch out a competitor's installed base, and they therefore include that entire base in their estimates of market size.
The Sustanability Trap: Companies often fail to include in their launch plans the costs of sustained support, multiyear promotion, and desired pricing moves. When a new product comes up for a second year of support, it is often the first budget line to be cut.
The Suhstitution Trap: Because innovation can succeed at the expense of existing products, screens must estimate cannibalization as objectively as possible.
The Uniformity Trap: No two new-product launches are identical.
The Tactical Trap: Innovations must be assessed in their full strategic context. Less obvious credits and costs, though material, can easily escape inclusion in a company's analysis of launch economics.