Comparing Predictive Innovation to Other Innovation Systems

Predictive Innovation Process

Predictive Innovation® reduces risk by providing decision makers the comprehensive list of options; so, they can confidently choose the best.

It allows you to see, in advance, what customers will want and how to most profitably make it from readily available resources.

The three key uses for Predictive Innovation are:

  • Business Strategy
  • New Product Development
  • Problem Solving

Innovation requires thinking & doing. There are two broad categories of innovation systems:

  • Thinking Systems
  • Doing Systems

Doing systems organize your work. Doing systems are also called project management. Doing systems require the results of thinking systems to function.

There are some very good systems for doing. Examples of doing or project management systems are Staged Gate & Agile/Scrum. If you know what to make and how to make it a good project management system will help you efficiently do it.
Thinking systems help you find the answers to the crucial questions:

  • Who will buy it & who will make it?
  • Why do they want it?
  • What to make and the criteria used to decide it’s good?
  • How to make it?
  • When to make and sell it?
  • Where in the total supply chain to perform each task?

Project management does not help you answer these crucial questions. Innovation projects are notorious for having huge rates of failure. The root cause of the failure is skipping answering one or more of the crucial questions. Without first knowing the answers to these questions you’ll waste huge amounts of time and money on trial & error. Predictive Innovation solves that problem.

Predictive Innovation is a structured system for thinking. It’s based on the same science that allows digital computers to process information and is supported by over 25 years of research demonstrating its effectiveness. It breaks down any subject into the essential parts so you can quickly understand and see potential opportunities.

Predictive Innovation is predictive. It does this by giving you a structured way to efficiently focus in on the meaningful information and filter out the noise without missing anything important. That shines a light on the highly valuable unexpected ideas.

Doing Systems

Innovation doesn’t occur until the customer is using the product or service. Most companies consider the innovation process complete when they launch the product. That thinking stems from the belief that making something new is all that’s needed for innovation. The truth is that new doesn’t mean better or desirable. Even if a new product is absolutely amazing it doesn’t innovate unless customers know it satisfies their desire and are willing to pay to get it.

Agile / Scrum

Agile / Scrum is a project management system. It doesn’t have a thinking system. It assumes you have a customer who tells you “what to make” in the form of a backlog of requirements or “customer stories”. Designing, developing and bringing new products to market takes time. Waiting until customers are demanding an improvement causes customers to start looking for someone to provide it and they might not come to you. That forces you into a race. That leads to wasted effort, money, and lost profits.

Agile / Scrum also assumes that the people working on the project can just “figure out” how to solve the technical challenges and still stay on schedule. Without an effective “how to” thinking system, a project team can easily get stuck and waste time and money beating their heads against a wall.

Combining Predictive Innovation and Agile / Scrum is a powerful formula for success. Predictive Innovation proactively determines future requirements and Agile/Scrum helps to efficiently get solutions to market. Predictive Innovation also can show all the ways to make something so you know in advance if it’s possible and you can choose the most profitable approach.

Staged Gate

Staged Gate is a project management system. It doesn’t have a thinking system. It’s poor for new products because it’s based on trying a lot of different ideas and weeding out the failures. That’s deadly to a start-up that doesn’t have the deep pockets to keep funding trial and error. Staged Gate is notorious for high failure rates. However, Predictive Innovation principles have been demonstrated to increase the profitability of Staged Gate by 95 times with 96% success rates at launch.

Lean / Six-Sigma

Lean & Six-Sigma are not innovation systems. Lean and Six-Sigma are intended for repetitive processes such as manufacturing rather than innovation projects.
Many aspects of Predictive Innovation came from applying Lean & Six-Sigma concepts to project based activities. The result is by using Predictive Innovation you can make your innovation projects as repeatable and reliable as your Six-Sigma manufacturing processes.

Thinking Systems


TRIZ is a great thinking system for very specific types of “how to” problems. The name TRIZ is a Russian acronym meaning Theory of Inventive Problem Solving. TRIZ is great for its intended purpose but it’s too focused on problem solving and physical systems to be broadly useful for innovation.

Predictive Innovation vs. TRIZSince “how to” must come after knowing “what to make” TRIZ doesn’t help with the most critical part of innovation.

Furthermore, TRIZ is based on patterns found in patents; so, it heavily focuses on physical inventions. Since TRIZ doesn’t focus on the non-patentable innovations it can miss as much as 75% of possible innovations. That means TRIZ will tend to miss the highly profitable service and business model innovations.

Predictive Innovation shows you all the types of innovation. Seeing all the types of innovation gives you better choices plus creates synergies multiplying value.

Morphological Analysis

Predictive Innovation vs. Morphological AnalysisMorphological Analysis (MA) is a thinking system developed by the famous astrophysicist Dr. Fritz Zwicky. Morphological Analysis uses tables to identify combinations. Dr. Zwicky used MA to predict many discoveries including supernovae and neutron stars. The biggest problem with MA is it doesn’t have a clear way to specify what should be in the tables. Dr. Zwicky was a genius and MA tends to require similar expertise to set up the tables properly. Without clear rules for setting up the tables it misses valuable parts of the idea space. It can easily generate an overwhelming number of ideas yet completely miss entire categories of extremely important ideas.

Blue Ocean Strategy

BlueOcean vs. Predictive InnovationBlue Ocean Strategy is a combination of a goal, some tools, and a few guidelines for implementing a plan. It has a few aspects of a thinking system but isn’t complete. Plus, it makes several assumptions that are frequently incorrect.

The goal of Blue Ocean Strategy is to create a new market segment so you avoid competition; thus, hopefully being more profitable. This is a good strategy but not the only profitable strategy.

Blue Ocean offers a few tools that are parts of a thinking system. The tools offered only work for a few special cases. Unfortunately it doesn’t have a way for you to know if it will work or not. One of the tools is what they call the 4-Actions. These mirror a portion of Predictive Innovation’s 7 Elements and 15 Alternatives. Predictive Innovation shows there are a minimum of 15 Alternatives for each of the 7 Elements of each Outcome. Actions are only one of the 7 Elements. Blue Ocean doesn’t cover the other Elements. That means Blue Ocean’s tool is only 3.8% of a complete system. It’s likely to send you crashing into the rocks to sink to the bottom.

The most valuable parts of Blue Ocean are the guidelines for implementing a plan.
If you want to reliably create Blue Ocean Strategies you need the lighthouse of Predictive Innovation to guide you safely around the hidden icebergs to the treasure.


Creativity vs. Predictive InnovationCreativity is the most common system for finding ideas. It’s also the least successful.  There are countless creativity based approaches to idea generation. Some of the creativity approaches are: Brainstorming, DeBono’s Six Hats, Killer Questions, Lateral Thinking, the list is practically endless. All of those are supposed to be thinking systems but in effect are the opposite of thinking.

The supposed “Fuzzy Front End” of innovation gets the name because of people using Creativity to generate ideas. The lack of objective criteria causes the confused fuzzy blurred vision.

Creativity is a random approach. Because it’s random it focuses on increasing the quantity of ideas ignoring quality. It specifically avoids criteria for evaluating ideas so it wastes a lot of time on wacky irrelevant ideas that don’t lead to successful products. Without real customer centered criteria for evaluating ideas, creativity is prone to personalities driving decisions. With a less than 1% success rate, Creativity is worse than doing nothing at all.

Design Thinking

Design Thinking vs. Predictive InnovationDesign Thinking is an incomplete system. It’s just a set of goals without a way to actually do it. The main goal is an attempt to consider how a product fits with other parts of the environment. Most people who claim to use Design Thinking are just using creativity with an iterative version of Staged Gate project management. The lack of a real thinking system makes Design Thinking very person specific and dependent on inherent talent. That makes it unrepeatable and difficult to scale.

Jobs-to-be Done / Outcomes Driven Innovation (ODI)

JTBD/ODI vs. Predictive InnovationJTBD/ODI has been shown to be up to 9 times better than creativity based systems. It’s great for “what to make” ideas but not “how to” make it solutions. Another weakness of JTBD/ODI is it relies on existing demand so the predictive value is decreased causing projects to start late relative to the market opportunity. It only covers about 13% of the “what to make” ideas space. Predictive Innovation covers the entire idea space. If you know JTBD or ODI you can easily learn Predictive Innovation and multiply your profits by another 8-9 times.

Open Innovation

The definition of Open Innovation is unclear. Typically it means asking potential customers for ideas. The concept of involving customers in the innovation process is great when used for gathering user requirements or “outcomes”. Just asking customers for ideas tends to be amplified random brainstorming which can be worse than nothing at all. It most often collects a tremendous amount of raw ideas causing even more wasted time on filtering and sorting.

Open Innovation can also lead to intellectual property problems that devalue otherwise good ideas.

Big Data

Big Data uses computers to brute force search through gigantic amounts of data hoping to find meaningful patterns in the noise. It can be great for finding connections or testing assumptions that would be impossible for a human to do because of the shear size of the problem.

By definition Big Data is looking at what was popular in the past. Big Data misses “why” it was popular. Without understanding why something was popular you can’t predict the future high value ideas.

Big Data is poor at predicting because it doesn’t understand the root causes. Computers are fast but can’t actually think. Ironically, it misses huge areas of information. Since Big Data is analyzing past records it only sees what you already chose to measure and record. The expression, hindsight is 20/20, accurately describes Big Data. That makes Big Data highly prone to unexpected “Black Swan” catastrophes. It’s like racing down the road while looking in the rear view mirror for guidance.

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95 Times More Profitable Products, Predictive Innovation Training

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Learn how to use Predictive Innovation® to predict what customers will want and how to make it so that you can increase profits reduce risk, and neutralize competition.

Find new markets, create new products, increase return on investment.

In a nutshell Predictive Innovation® is a structured way to describe what people want and how to provide it. Anything that can be made or done can be described. If you can describe it you can also describe the ideal version.

The Ideal Product does What I want, When I want, Where I want, with whom I want, in the way I want, for the price I want with no hassle.

If you step backwards from the ideal to what is available today, each of those steps is an innovation. There isn’t just one straight path to the ideal, and many of those paths are dead ends. Predictive Innovation® gives you a structured way to describe the entire idea space showing you all those paths.
Describing all possible innovations:

  • reduces risk
  • increases profits
  • maximizes return on investment
  • allows you to calculate the Total Innovation Value making it easier to choose and get support for good projects

The most common approach to New Product Development is to use a Staged Gate Process starting with a huge number of ideas then filtering them down through a number of stages until what is hoped to be a successful product is launched. Despite the typical Staged Gate Process having 7 stages the failure rate of new product launches is 40%, basically random. Despite 50 years of attempts to improve Staged Gate the failure rate has remained 40%.

A study of 576 projects at 360 Fortune 500 companies revealed there was a huge difference between the results of product managers at the same companies using the same process. The bottom 1/3 had an average of $2 million profits with the 40% failure rate. The middle 1/3 had an average profit of $21 million again with the 40% failure but the top 1/3 had $189 million profits, 95 times as profitable as the bottom 1/3. Instead of a 40% failure rate they had a 96% success rate. Clearly the top 1/3 were doing something very different from the bottom and middle.

The best definition of innovation is:

Profitably satisfy unmet desires.

Profitable doesn’t just mean money. Consumers profit from using the innovation. They give money to get their desire satisfied. Businesses profit monetarily. Charities profit from doing good. Whoever is involved with an innovation all of them must benefit or it just won’t happen.

Unmet desire is one that has not yet been satisfied some other way. Innovation does something new or better. To innovate you need to know what to do, how to do it and you must do it correctly. So there are two basic types of innovation systems, thinking systems and doing systems. Staged Gate is the most common doing system. Creativity is the most common thinking system.

Creativity is unpredictable, unreliable, unfocused, inefficient, highly emotional. Its often said in brainstorming sessions to leave egos at the door which shows you how emotional it is. Creativity is also person specific depending on people with special talent. Anyone can do Predictive Innovation® without being particularly creative.

Staged Gate manages the risk but you can see that the risk is caused by using creativity for ideas. If you use a different Thinking System Staged Gate can focus on the risks of doing and achieve the 6-Sigma results you want.

The Staged Gate Process using creativity starts with a large number of ideas and filters them down. On average it takes 300 ideas to produce 1 product. That filtering process costs 9 times as much as developing a single project.

When we analyzed innovation as a process we discovered there are 7 Essential Functions to the innovation process.
Those steps are:

  • Reveal emerging expectations, the things customers demand in the near future
  • Generate ideas that satisfy the emerging expectations
  • Convert ideas into designs
  • Make new products or set up systems to perform services
  • Communicate value, both internally and externally
  • Deliver new product or service
  • Get and use feedback that is meaningful, and start again with generating ideas

Notice that you don’t need to reveal emerging expectations again. Emerging expectations are the criteria for ideas and products. This is what to measure and the current measurement. Since in the first step you defined the emerging expectations you already know what customers will want, it is something closer to the ideal. The ideal product perfectly satisfies all the criteria for a product. Each improvement between the ideal and what is available today is an innovation. Feedback tells you how close to the ideal your product is and how much closer is needed for the next improvement to be accepted by customers.

The second step is generate ideas that satisfy the emerging expectations. There is such a thing as a bad idea. Any idea you spend time or money on that doesn’t profitably satisfy a customer’s desire is a bad idea. If you skip revealing emerging expectations then the ideas are a random mess and you end up spending huge amounts of time and money sorting and testing the ideas hoping to find a good one. If instead, you start by defining the criteria of the emerging expectations you know what customer’s will want so you can focus on generating ideas that match the criteria. Predictive Innovation® also gives you a structure for ideas so you can quickly identify the right idea and all the related ideas. This makes it possible to choose the best idea and have a sequence of future products related to that core idea.

Once you know what to make you need to know how to make it this is what you do when you Convert ideas into designs. Even if customers want an idea if you can’t profitably make it then its not a good idea for you. Being able to solve the technical challenges so that you can profitably make what customers want is essential to success.

After you have the design you must efficiently follow it. Making the product or setting up the system to perform the services is where the doing system takes over. This is where Staged Gate and other process control methods like 6 Sigma will help you the most. You will still need a thinking system to improve your process and overcome unexpected challenges and Predictive Innovation® helps you there as well.

Communicating value is really done throughout the entire process. You must get approval from stakeholders, funding for projects, and motivate workers in addition to selling to customers. The criteria revealed with the emerging expectations provides you the tools to effectively communicate value to everyone in their own language.

Innovation hasn’t occurred until the customer has the product and is using it to satisfy their desires. So you must deliver the new product. And finally you should get and use feedback from all the steps. Knowing the criteria again is essential to asking the right questions and determining how to measure the results. Without first revealing the emerging expectations the entire process suffers.

Using Predictive Innovation® changes everything. Instead of filtering down from a pile of random ideas you start with accurate criteria to build up a family of successful products. This increases profits and reduces risk at the same time.

Predictive Innovation® Overview
There are 6 dimensions to Predictive Innovation®, these are:

  • Actors
  • Desires
  • Scenarios
  • Alternatives
  • Outcomes
  • Elements

For Practitioner we will focus on Alternatives, Outcomes, and Elements.

Every scenario has approximately 7 outcomes and each outcomes has 7 types of elements with 15 types of alternatives. This makes the hypercube of the idea space. 15 Alternatives times 7 elements times approximately 7 outcomes produce approximately 735 types of ways to innovate for any scenario.

These are types so there can be multiples for each type but there is at least one of each type, this defines the idea space. The complete idea space must have at least one of each of the 735 types. Most products don’t properly satisfy one or more outcomes and only cover 3 elements with 1 Alternative. This means that less than 1% of the idea space is covered by most products. That leaves a huge amount of space available for innovation.

By not covering the entire idea space a large amount of the possible profits are ignored. Most products cover less than 1% of the idea space and only 13% of the idea space is even explored. This is a huge area of missed opportunity.

That ignored space is not only missed opportunity it causes risk. That unexplored region is open to competition, might have easier higher profit ideas that better satisfy customers desires. If you remember the difference between the profitability of the different project managers its very close to the same ratio. The reason the top 1/3 of product managers are 95 times as profitable is because they reduce the risk and increase the opportunities by covering the entire idea space.


Describing all possible innovations:

  • reduces risk
  • increases profits
  • maximizes return on investment
  • allows you to calculate the Total Innovation Value making it easier to choose and get support for good projects

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