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“Discovery Driven Planning” praised by Clayton Christensen

In a Business Week Online interview, highly-regarded Harvard business school professor and author, Clayton Christensen, praises the work of Rita McGrath and Ian MacMillan:

“There’s a method that’s the brainchild of Rita McGrath at Columbia and Ian Macmillan at Wharton called “discovery-driven planning.” It’s a much better way to assess the value of projects. Most companies, when they look at the financial projections [of a potential innovation project], if they look good, they do it. If they don’t, they don’t.

But the desirability of attractive numbers has never been an issue. Why shine the spotlight on the numbers? Rather, a better way to do it is: We all know how good the numbers need to look for this to be attractive. But what assumptions have to prove true in order for those numbers to materialize out of this innovation? So you focus the spotlight on what assumptions have to prove true, and you launch a project to test those assumptions. It’s a much better way.

If you combine Rita’s work with mine — that a disruption always creates market capitalizatio — and if one of the assumptions relates to what job customers need to do when they hire a company’s product, the probability of success and of it being big can be assessed without even looking at numbers.”

To read the entire article, click here.

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