I fully acknowledge that there is such a thing as too much information. My work on this site serves as Exhibit A of this problem. Or it will if I don’t do what The Lean Startup advises.
Case in point, yesterday’s lengthy post was all about how we need to learn quickly to expand our knowledge about a new endeavor. It was an argument against confidence (e.g., there are no black swans!) and a very basic introduction into bounded rationality. To expand the bounds of your knowledge, you want to discover all the unknown unknowns and you want to get feedback to validate what you’re doing in any effort.
As Eric Reis puts it in this week’s book: In the Lean Startup model, everything is understood to be an experiment designed to achieve validated learning.
Hmm … information from potential customers. Sounds like market research! So clearly, when taking on new endeavors, we should develop market research. The more, the better.
Sort of. But not really. Consider the Ford Edsel. It serves as a multi-million dollar lesson (a very expensive tuition) on how projects fail with too much information. It had all the love, focus, and resources necessary to be a success. It was even named after Henry Ford’s son. And yet, it failed. Why?
It started with some magical thinking. As an idea, the car was akin to the newly-announced iPhone XS. As you may be aware, the iPhone now has three models: a standard iPhone, the iPhone X (the “Cadillac” of smartphones), and the iPhone XS serves as our proverbial Buick.
It is “luxury you can afford”. Coincidentally, this is also the title of a decent Joe Cocker album.
The Edsel was supposed to be the same thing: an intermediate step up in the consumer market sandwiched between the standard makes and models of the Ford label and the premium tier occupied by Lincoln and Cadillac. Not a bad idea!
Here’s where the magical thinking came into play: Ford thought that, with enough planning and research, they could hit their moonshot on the first try. And take their time doing so.
Two years and $250 million dollars went into the research, planning and retooling. The designs were built on a dataset that included the target’s perceived motivations, personality, and aesthetic tastes. The result?
One of the ugliest cars ever produced. Delivered at the precise moment when consumer tastes shifted towards compact cars. Ford completely missed the moment. More importantly, they built something with tons of research and yet not coherence and soul. If a camel is a horse built by a committee, the Edsel is a car built by research and marketers.
Ever since, vehicles have been placed on annual releases (instead of the two years it took to launch the Edsel) and new vehicle concepts are field-tested more broadly in stealth deployments . Meanwhile, concept showcases have become an advanced art of the industry. All in order to gain better information on shorter cycles.
The point? Validated learning is not the stuff of market research and planning. Validated learning is what happens when our theories and research come into contact with the customer. You can spend a lot of time and money to build something that is perfect for your market research. But market research doesn’t buy cars. There must be a better way. The Lean Startup helps to show us that.
Photo from the APHS