[MUSIC]. Next, industry constraints. We talk about competition, we talk about suppliers, we talk about markets and the roles that those play in constraining innovation. Well here we have this problem where there's, with this golden boy mentality. Venture capital funding, we just talked a great deal about that. what happened was these people got together and they assumed this was a technological product. This was not a technological product. The product was a technology certainly, but people were not going to use it in a technological way. One thing they also did was they only used insiders to test ideas. There's this notion of, you know, it has to be top secret, it has to be top secret. We can't let anyone else know about this. And so they only used insiders, people that they trusted, but also insiders who were people who were always going to tell them what they wanted to hear. They also, I mean by the way, they didn't bring users into the design process. That early on they didn't bring people in and say hey what do you think. Well that's basically par for the course with someone like Steve Jobs, also with Dean Kamen who view themselves as very, very smart, the smartest person in the room. They're also able to see things that others can't see. They're a visionary in that way and so they're seeing this thing and saying this is how it's going to be. And if you don't see it's just because you're blind it's just because it's not the right thing to do and so that kind of mentality in the venture capitalist industry I think drove them to have this kind of view. Also the tech industry added to that in fact there's a bunch of engineers and people talking to each other made it very much more difficult for them to see what was going on outside. In terms of infrastructure. So we talk about the market and we'd understood from our discussion about industry constraints is that adoption costs are a big deal. And that if people buy something and that forces them to change a lot of their behaviors or change the things, change the things that they assume about themselves. Change the ways that they Or go about things that's problematic. So in this case New York City has been expanding its bicycle bike pass system which would be great for a segway. However it's 10 years late. Right. So this is 10 years later before the infrastructure was in place to be able to use for the segway. And when this thing was built. The bike, this bike path was built. They're built for bicycles. And in many cases segways were forbidden from riding on bicycle paths. next is aisle constraints. We're talking about values and identities, social control and history, the things we've talked about earlier in this set of lectures. So is the segway socially acceptable? You know, is it socially aceptable. Is it something you are so proud of that you are going to ride down the middle of the street in your skimpiest outfit with your tiara... Miss Broadway, or that something that's unacceptable, like you know, Paul Blart: Mall Cop. Which is it? I was reading, as I was doing on the Segway, I ran across some, bulletin boards, that is some discussion boards where people are talking about the Segway. And here's one included this guy that said he was busted in Denver. He said a police officer basically pulled him over, said your not allowed to ride a Segway in Denver except on private property. And the guy says well, you know, I, I, I'm not aware of any law against Segways. And so the police officer who responded right, do you want me to give it to you in a ticket, so you have it in writing. So apparently there are[UNKNOWN] in this case explicit controls, explicit social control, for where you are allowed to drive it. And, ironically, this person, then goes on to say, how when he rode home, he sat next to a person on a bicycle and the person on the bicycle complimented him for being, sort of, eco-friendly, in the device that he was using. So he wasn't in a car, but he's using the selected device, at work. And he says, too bad politicians and police don't see it that way, that is, the fact that he is doing something good. And it's not something bad that he's doing. So here's the problem of social values, right? That he has different values than the values of the society, and society is pushing back against that. So, as these things get banned. they're considered too slow for the street and too fast for the sidewalk. You can't ride on either. What do you do? Well is it because it's too dangerous? Well guess what? Bicycles are pretty dangerous too. In fact lots, a lot more people die on and, and are injured on bicycles, probably because there are a lot more bicycles. But one thing with bicycles, we understand how they work. And so maybe the danger is apparent to us. We understand what the dangers are. Whereas, with this new technology that we aren't sure how it works, we're not sure what potential harm will come to people. And there is the potential for harm. If you don't believe me just type Segway Crash into YouTube and you'll understand it is potentially a very dangerous device, and so that's the thing that people are trafficking. Another kind of danger of this device came in the form of the battery. And so you may remember a time when these laptops were catching on fire and exploding. This particular laptop in fact, they had to evacuate an, a, office building, office tower because this thing caught on fire and exploded, and here's what's, what's left of it. And so it was these lithium batteries that was the problem. These lithitum batteries, there was a big recall on them. Apparently if you charged them improperly they're subject to this thing called thermal runaway, where this thing gets hotter and hotter and hotter, and then just explodes. Well guess what, the Segway is specified to have a lithium-ion battery,not just a few ounces of it like that laptop but 22 pounds of lithium. And so one of the ideas for the Segway is that you people to take this on an airplane, go to your next place and ride around, and this would displace the rental car. Well, with 22 pounds of lithium, subject to that kind of blow up and burning up, there's no way on earth you're going to be allowed to take on a plane. And so in fact, they were banned on planes. And this person in this, in this, again, I'm from, is one of these discussion boards, talks about, the kind of battery that they use is not this phosphate battery, they use, actually use a different kind of battery, in the Segway. But it was specified for a lithium battery, and that's what it says in the the data sheets. And so there on that basis it was banned. So, even on a perception that it's going to explode. Even though it may not be true. It was enough to think this thing. We want to think about diffusion rates. So what were they thinking? How fast did they think this thing would be adopted by people? Was it something like the telephone here, which seemed to have taken a long while? Or was it something more Quick. Like one of theses other things like the radio. Like the m radio or something. That was seemed to be a very rapid uptake of bi people. And then what drives these adoption rates and how do we think about those. So here some different categories of things with different difffusion rates. It's very dificult to predict. Now Marketing people and user analysis people are the kind of people who could help us understand these things but those weren't the kind of people they were having on the team when they were developing the segway and so again these are the kind of things these kind of social constraints that things that stop people the way that people view these things that stop people from adopting were not being considered. So, societal constraints, values, social control, and history, we can see all three of those things are ones that seem to be constraining the adoption of the segway. Now for the sake of completeness, let's talk about technical constraints. I know we're not going to talk about it at great length until next week. But let me just sort of preview for you and say there are going to be three kinds of constraints. Control of physical world, like to what extent do we know how to control the world, making matter behave. Time is another one. The timing sequence, windows of opportunity, those things can be constraints for us. And also the natural environment. Getting access to the resources that we need. Need in the natural environment may be a constraint as well, so those are what we're going to call the technical constraints. So, from the perspective of the technical constraints, the Segway really did not have a lot of technical constraints. The Segway was a the Segway Beta, the Segway was a derivative of a innovation that had already happened. It was the iBot, right, so they basically just took two wheels off the iBot made it a little bit more rugged, and then it became the Segway. And so there was not a problem for it to be developed in that way. You know, maybe the battery, they were still working on, but basically, it was not rocket science. It was not a big deal technically to make this thing work. So, if I look at the constraints of taking these all together, so we've been through them all individual, the reliance on prior successes, and this was Dean Kamen's failure, to think about this problem differently than he had before, and also the other individuals around him, Steve Jobs, Bezos, all those. Through the group constraints, there was no process, the lack of problem definition, they were doing emotion processing, not information processing. The organizational structure organizational constraints, we get this, argue the structure was problematic because the way the organizational who was composed of, also the, everyone reported to Dean, we had sort of a benevolent dictator model there, and also the market strategy seemed to be off. Industry constraints. the substitutes weren't considered. What is the substitute for a Segway? Well, I've got my feet. I might have a bicycle. I've got lots of other things I can use. They serve the same exact need, but they have a very different adoption cost. also the diffusion rates. Understanding what, how it was going to diffuse and then how long it might actually take. They knew they needed to leave a lot more time. To[UNKNOWN] up the learning curve in order to understand how people are going to use it. There's societal constranits, the sort of adversial attitude towards the segway. Not really sure where that came from. Maybe it was because of the fear of the harm. Maybe it was because people didn't understand how it worked. Maybe it was because people were seeking health and this thing represented laziness and this[UNKNOWN] represented because lots of police had it, lots of military had it. Maybe they thought of it as something as a facist tool. who knows? and so the result became highly regulated as well. And then the technical issues were cost, complimentary infrastructure, those kind of things that weren't there. And so of these, I would say really that the societal constraints are probably one of the big ones that they had. A way to look at this now, and so I'm using slightly different language to show the constraints here that we've been talking about but nonetheless, you know, think about it this way. They're focused on technical performance they're focused on patent protection they're focused on liability those things. And they're essentially ignoring and we can see where the star is catches the overlap of those. And that would if those were the only ones that mattered in this case they would have had a winner. But, things like price point and the demand at that price point, which market were they in, which market were they going to attack first, also where to ride. Those were three things that they weren't in the overlap, that they weren't considering, that they hadn't really sort of thought about how we open this up and encompass the things that came before. So the Segway hit, but it hit in a place where there was not complete overlap in the constraints. So I would say, you know, generally speaking that I think that thee socidal constraints on this one were the big problem, or the big constraints that we're not satisfied, and not adapted in some way. So let's take this around, all the way around and say so here's Dean Kamen saying, you know, if this thing we're widely adopted Urban design, the Segway would be the the car with the you know what the course with the car was to the horse and buggy, that we would've moved so far forward and life would have been such a much better place. Dean Kamen believes that his creation that this thing it suffered from inflated expectations. So basically he believes this is a great thing, this is such a good thing. And he was just quite about it, and had he told more people, more people would have wanted it. You know, he's like all dreamers, like all inventors, a dreamer who couldn't help himself. So I think, so we're thinking that we're back to the individual level where Dean Kamen's sense of, of self maybe gets in the way of him being able to see what the constraints are and be able to understand that he has to work against those constraints. It's not just what goes on in here, but it's also what goes on out there, in a way that helps innovation occur. That helps us push through innovattion. To wrap this up, I'm going to talk about just, just briefly about the kind of constraints on radically new products. So radical products, they tend to require a longer incubation and adoption periods. We need to leave extra time, which means we need to leave extra money also, because that time is money, right? Because there is time value in money. We need to leave that. And we need to account for learning. we're generally going to be wrong. You're going to be wrong about why people are using it, how people are using it. Among all the things that could be, you could be wrong about, you're going to wrong about, especially if it's a radically new product. And so, you need to leave time to understand those. You need to do market testing, you need to, to reduce uncertainty. Time may not have a large opportunity cost because with a radically new product, you're not going to have competitors, you're not going to have markets shifting very quickly. And so you have the time and you can make the time. You need to invest in reducing uncertainty and there can be incremental steps that you can invest in, market studies, prototypes, prototypes, market studies, just keep doing that to drive down uncertainty, that is drive down risk. Another thing that's important is to understand is that the need is independent of the technology you used to meet the need. That is to say that what is important, like what it does, not how it does it. And if you think that the how, like I have a, a self balancing two wheel device that that's the most important thing, that's wrong. What's the most important is do people need to get from here to there. What do they need. And then to say while needs are concept-independent your constraints are not. So, if I have a need there are lots of different ways of solving that. But depending on what my idea of solving it, the constraint that I face is not concept-independent. Right. And so the way that I'm going to solve a constraint that calls into account. So if I do it this way that might be too expensive. If I do it this way, that might illegal. If I do it this way it might be. So, I need to be able to stick myself to the need, and then develop concepts for, around it that will allow me to probe which constraints I can overcome. By having different concepts for that. [MUSIC]
