Stopping runaway-train NPD projects … bring in a poker player


In a “runaway-train” project, an unprofitable idea for a product takes on a life of its own. Decision makers continue to overlook the idea’s shortcomings and make more funding available. Then the train crashes. The firm loses money and developers damage their careers.

Researchers, such as Bethany McLean, investigate runaway-train projects in a neutral, scientific way. Their conclusion? Smart people, not dumb people, make most of these bad bets. They are seduced by confirmation bias-. “A tendency to test ideas in a one-sided way, focusing on one possibility and ignoring alternatives.” (Wikipedia)

Stopping runaway train projects in the front end of new product development (NPD)

The odds for success are very low for a NPD project entering a new market.
But, when the project does succeed the payoff can be large.

My first job, as a materials scientist, was on a runaway train project whose goal was entering a new market. After the project crashed, I wondered, Are there NPD decision-making tools which limit confirmation bias? It turned out there were.

That was the beginning of my quest for better customer research in b2b NPD. By science-based, trial and error, I developed an effective process for doing so. A stint on the editorial board of the Journal of Product Innovation Management for 20 years helped me fine tune the process.

A successful poker player’s lens for decisions made in the front end of NPD

In the past 5 years I became aware of the work of Annie Duke, a scientist turned successful professional poker player. She says there are 2 things needed for better decisions when you’re faced with uncertainty. “The quality of our decisions and luck.”

You can’t influence luck. But, in the front end of NPD or playing a poker hand, it is possible to improve the quality of your decisions. You do this by an outside-in search for hidden information. Using this information, you figure out the odds against each reasonable action in the front end. Then, to maximize the quality of the outcome, choose the action with the best set of odds for success.

In my consulting practice, I’ve completed 11 projects where the client was dealing with a runaway project. To gather responses to the client’s product concept, I used elicitation conversations with 30, well-informed individuals in the new market. The projects were blind studies; individuals did not know the identity of my client.

Analysis of the responses provided new qualitative and quantitative information. For 8 projects the quality of this information, overcame internal political problems at the client, and the runaway train was stopped. In 3 projects, hidden information on latent needs, redirected the project to a more promising action.

NPD is a bet that chosen customers or needs will be enduring


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