Apple Inivation: Fail Wisely has a good story about Apple's style of innovation.

Listening to customers is generally a good idea, but it is not the whole story. For all the talk of "user-centric innovation" and allowing feedback from customers to dictate new product designs, a third lesson from Apple is that smart companies should sometimes ignore what the market says it wants today. The iPod was ridiculed when it was launched in 2001, but Mr Jobs stuck by his instinct. Nintendo has done something similar with its popular motion-controlled video-game console, the Wii. Rather than designing a machine for existing gamers, it gambled that non-gamers represented an untapped market and devised a machine with far broader appeal.

The fourth lesson from Apple is to "fail wisely". The Macintosh was born from the wreckage of the Lisa, an earlier product that flopped; the iPhone is a response to the failure of Apple's original music phone, produced in conjunction with Motorola. Both times, Apple learned from its mistakes and tried again. Its recent computers have been based on technology developed at NeXT, a company Mr Jobs set up in the 1980s that appeared to have failed and was then acquired by Apple. The wider lesson is not to stigmatise failure but to tolerate it and learn from it: Europe's inability to create a rival to Silicon Valley owes much to its tougher bankruptcy laws.

What I find interesting is that Apple does two things that most companies don't. First, they sometimes ignore the current state of the market when designing products. Second, they learn from failure rather than stigmatizing it. That sounds like a pretty different corporate culture than most companies.

  • The Economist article is indeed a good one. I recommended it on my blog as well. The question I have is how much of the great Apple innovation is due to Steve Jobs and how much to the rest of Apple. For my money, he is one of the best product development people ever, with the unique position to be able to drive what he thinks is important through to product launch.

  • We don’t hear enough about companies who’ve learned to fail wisely. There are several and they have learned how to foster a climate that encourages wise failure. One health care group has a rule, “It’s okay to make mistakes.” Seems counterproductive but stats show they have reduced medical error far below the mean since adopting the rule.

  • A right idea, though hardly novel.

    I recall it being impressed on me thoroughly in business school in 1975 that the rule of “find out what the customer needs and deliver it” is not valid in high tech businesses, simply because customers are not capable of envisioning products that don’t exist. The idea of market research a la P&G has to be subordinated to instincts of nerds in businesses like that, because only they can connect the dots.

    Jobs is simply continuing a lesson that companies like HP and Tektronix and Lotus taught us all about three decades ago.

    Still a right idea, just don’t call it new.