Why Some Big Companies Struggle with Innovative Projects

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Big companies sometimes struggle to complete innovative projects for a number of reasons – but often, it’s because corporate leaders don’t recognize the limitations of their teams. This problem isn’t fixed by throwing money at the problem – just beacuse you have a huge budget doesn’t necessarily mean you can easily assemble a team of software developers who can get the job done.  Sometimes, it’s easier to pull in a seasoned, experienced team, rather than trying to build your own – but can this work?  Isn’t it just as easy to do this with your own people rather than consultants?  What’s an example of a project that failed internally, but was successful once it was outsourced?

innovative projectsAn example of a big company who found themselves in this situation is HBO – which had put the development of their streaming video service (now known as HBO GO)  into the hands of their chief technology officer back in 2014.

In their case, they had a huge budget but didn’t have the right team of software developers in place. They relied on the expertise of their CTO alone, who was probably excellent in other areas, but didn’t do well leading a disconnected and thrown-together team. After the launch of the initial version of the streaming service, customers started complaining about outages, which was embarrassing to the company.  Later, they found out that the CTO had known about a memory leak for nine months but had decided on his own that it was a “non-issue.”

The software crashed several times that year and the chatter on media sites became intense. HBO had to call in for emergency help and outsource this project immediately – and realized that they needed to change strategies for innovative projects, stick to their core competency of media creation, and not try to shoehorn themselves into being a software company.

Considering they are part of one of the biggest companies in the US (Time Warner), why couldn’t HBO successfully pull this innovation project off internally?

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Firstly, it seems as if their CTO underestimated the project’s complexity while ignoring changing requirements and warning signs along the way. He also delayed product launches and was unable to deliver on upgrades. With all of these setbacks, HBO got frustrated and wanted to get to market faster, which meant they had to rush out a less than perfect solution.

Secondly, the sheer size of a company like HBO (and Time Warner themselves) meant that even though their streaming app seems like a large project by some development standards, it is minor compared to the budget of a major HBO film series, such as Game of Thrones (which commands an average per-episode innovative projectsbudget of $10 million).  This meant that the streaming project likely could “hide” in the swirl of other projects at the company – so no one noticed it was off the rails until too late.

Thirdly, it is clear in this case that their CTO was guilty of what I refer to as “empire building” – which is when your goal is create a large, impressive, fancy department at your company, regardless of if you’re actually moving things forward at your firm.  This leader got caught up in the idea of creating a “dot com” like experience for his employees (by doing things such as building a very fancy office, rolling out the foosball tables, etc.), and forgot to provide value.

In my experience, with the right technology partner, this process can be very different.  A true consulting partner will have deliverables and goals very clearly defined, and will stick to the plan.  Since a development partner isn’t an employee of the company, there’s no conflicting goal to simply get promoted, or build a fancy office, or get to play with fancy technological toys – the goal is to deliver a working system for a set price that works – above all else.  And the proof is in the pudding – if you don’t deliver, you often don’t get paid.  Did HBO’s CTO face a similar expectation?

In HBO’s case, they had to go to the very end to see that they had made a mistake, which I suppose proves that it’s never too late.  If you find yourself in a similar situation with your innovative projects, feel free to reach out, and we can see if we can help.

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Sam Schutte
Sam Schutte
Sam is the founder of Unstoppable Software, and has his hands in all aspects of its operations and growth. He loves architecting software solutions to fit a specific business need and helping CIOs and other technology managers figure out their software development strategies.
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