For all the hype on innovation projects that have started in the energy industry, why do projects get stopped? Or why do blockchain projects in the energy industry not continue to the next phase? Why do they fail to achieve success?
Three Show Stoppers
The top three reasons, in no particular order, for why blockchain projects in an energy context get stopped are:
-
The technology is not ready.
-
The business value is less than was anticipated.
-
Governance issues and dealing with decentralised ownership.
Often one or two of these is sufficient to shelve the project permanently. Once announced with big fanfare, now quietly put on hold. Lessons are written down to extract some value of it for the money and resources spent.
Leap of Faith?
So how is this possible? Did all these projects take a 'leap of faith' and dove right in head-first? Fortunately, that is not entirely true. While a lot of things can be anticipated upfront, this is a rather new space we are all exploring. We are making discoveries at every turn. New barriers only become known once we stumble upon them. With most of these projects, I see several things that contribute to a failure to deliver:
-
Learning by doing.
-
Hype-clouded judgement.
-
Innovation Theater.
Losing Innovation Faith
So how does this contribute to the 'Leap of Faith' falling short? What do the teams involved do? Of what do they neglect to follow?
Learning by Doing
We learn new things along the way. Along the way, when the rubber hits the road, things are more costly than anticipated. Things don't work as hoped. You learn by doing, and sometimes the lessons learnt are not favourable. Valuable, but they don't contribute to success yet.
Blinded by Hype
Clouded judgement and ambitions due to the hype. Inflated expectations fuelled by too much hype can make companies overly confident. When the actual project only delivers on a fraction of what we aimed for, it is only logical to put it on hold.
Just for Show
Not being open about Innovation Theater projects. We have big ambitions for a project. But when the actual goal is not disruption, but for PR purposes, the entire project is just for show. Shows are supposed to go on, but in this format, it is not sustainable.
Show Stoppers
Knowing why the faith was lost, why is it only logical to stop those projects? Proper foundations for a project are built with data, not with abstract concepts such as faith or hope.
##Technology is not readyOften when the technology is not mature enough, a project has a specific desire to do a particular number of transactions. The tech can not deliver the throughput that is required. It does not scale as expected. Two things are at work here:
-
Did the project take an honest, hard look at the initial requirements? Did they miss an opportunity to optimise the process before trying to capture in a blockchain format?
-
A lot of work and research is done to enhance the technology. What does not work today might scale in the future. Keeping tabs on your shelved projects to respond to these developments makes sense.
Business Value was Lost
The initial business case has changed dramatically, for the worse. Some parts were more costly. The benefits or savings were less than anticipated. Extra time and effort are required to make it work, eating up the business case.
Governance becomes a deadlock
When there is one owner, that owner gets to decide what happens. With a decentralised system, comes shared ownership. When changes are required, the shared owners have to reach consensus. A lot of companies are uncomfortable with shared ownership. These companies need time to get used to sharing responsibilities with their competitors.
Want to prevent early termination of your innovation efforts? Let me help you see prevent the common mistakes and navigate around them.
