I know very few CEOs who would say they are good at stopping bad projects. The result is higher costs, lack of innovation, and unmotivated and fearful employees.

So, why is it so hard to stop a project that has not and will not deliver on its goal? In my experience, there are three factors: fear of failure and the results of that failure by managers and leaders, organizational momentum or culture, and lack of processes that produce transparency. According to published research, these three factors contribute to between 70 – 90% of new products failing. But, the problem is not the failure rate; the problem is how long it can take to kill a bad idea.

In the 1990's I was responsible for the Mobile Audio Group for Sony in the U.S. We had dozens of the most popular and profitable products on the market, CD-Walkman®, Sports Walkman®, and every portable music device you could imagine, including one that made digital audio recordings - MiniDisc®. MiniDisc® (M.D.) was a bad idea. 

MD was not a bad idea because the product didn't work; it did work as advertised. It was a bad idea because it was both early in the digital wars with the music industry and massively overpriced for what it delivered – 74 minutes of digital recording that you could not copy from a CD. 

Being early in digital recording made M.D. units very expensive, $500 and up in 1992 dollars, and Sony's ownership of Sony Music created the political problems that Apple never faced years later when they launched their iPod. But, Sony was famous for being early, think Betamax, Trinitron® TV, CD, camcorders, digital cameras, DVD and much more, so what went wrong with M.D.?

At its heart, Sony is an engineering company. They invented terrific things that, as Akoi Morita, co-founder, said, "people didn't even know they wanted…". That engineering culture was the basis for many monumental wins and a few biblical losses, think Betamax®.  We had many discussions, meetings, arguments, and long Sapporo-enhanced dinners at small tables discussing how to make M.D. a winner in the U.S. and worldwide. Still, the elephants in the room were always off the table: M.D. would never record a digital output from a CD player, and the price could not be lowered due to the component costs. So, the result was an overpriced product that didn't do what consumers wanted. 

Sony's engineering culture was dominated by legendary men such as Shizuo Takashino and Yutaka Nakagawa, who were largely responsible for developing Sony's audio and digital imaging global dominance. Their success put incredible pressure on the next generation to win and prove their worth. Engineers like Takashi Fukushima, "father" of M.D. and the person responsible for Sony's audio business in the '90s, had to live up to the mythology of Sony, and failure was not an option. But, the game was not set up to win, so the game was played all the way to checkmate in 2013. 

 The Sony MD case has all the makings of an innovation disaster: fear of failure, organizational momentum, a culture that could not adapt, and lack of processes that could potentially stop the project before billions were poured down the proverbial drain. I wonder what the results might have been if the culture of Sony engineering in the '90s had allowed for a process like Rita McGrath's Discovery Driven Growth? Fukushima-san was not a bad engineer or leader, in fact, he was one of the best in the world, but he was put in an impossible situation without the tools to help him win. But without the tools and organizational support to admit he was on the wrong path, the game was lost before the first pawn is moved to king's rook 4. 

Be well,

Ron