November 26, 2019

Companies should fail more often

Instead, 70% of innovation projects are developed but then shelved

Maija Palmer

2 min read

Some 37% of big UK companies have tried and failed to implement a new technology in the past year, according to a newly-published study. That’s a startling statistic.

But Ritam Gandhi, founder and director of Studio Graphene, the independent UK-based innovation consultancy that commissioned the research, says this is a good sign. In fact, he wishes the failure rate was even higher.

Much better to have 20 failures that cost £50,000.

“Companies should be trying and failing — they should be having as many failures as possible. That shows they are really trying new things. But the failures should be limited, at minimum cost,” he says.


The worst, says Gandhi, is having just one big, expensive failure, such as the bungled digital programme the UK’s National Health Service (NHS) tried to implement in the early 2000s, which ended up costing £10bn and killed appetite for any tech improvements for more than a decade.

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“Much better to have 20 failures that cost £50,000. It would still cost only a fraction of the NHS failure,” Gandhi says.

Instead, says Gandhi, big corporations end up being too cautious. The reward/risk ratio is always stacked against innovation at big companies. A project that lifts sales by £50,000 barely registers in the annual results. But a £50,000 failure could become a disproportionately big embarrassment.

This dynamic is having a chilling effect on corporate innovation. Studio Graphene surveyed 750 UK business decision-makers and found that while 71% of companies have budgets and resources dedicated to innovation, most felt they weren’t doing it well.

87% of big businesses say there is too much bureaucracy preventing them from putting ideas into action.

Some 71% of large business (those with 250+ employees) believe they are less innovative than rivals. 87% of big businesses say there is too much bureaucracy preventing them from putting ideas into action.

Gandhi says that this echoes his own experience. He says about 70% of all the projects Studio Graphene creates for big corporate customers end up being shelved.

The consultancy has learned a few tricks over the years to increase success rate — for example tackling important issues like security testing from the outset and getting go-ahead from senior management. But companies still developed cold feet on an overwhelming majority of projects.

Studio Graphene founder Ritam Gandhi
Ritam Gandhi: 70% of corporate innovation projects get shelved

“You learn to be philosophical about it,” says Gandhi. Corporate customers, he adds, aren’t concerned either.

“Honestly, the money is just loose change for them. They spend more on the maintenance of legacy systems than on these innovation projects,” Gandhi says. That, too, is part of the problem.