Sometime ago I was reading through an MIT book about innovation and one of the definitions for innovation on the book was: “the successful exploitation of ideas”. While this definition could be true to a certain extent, I think that most people wrongly associate innovation with success.
In my opinion companies can innovate and still fail. Whether you consider success to be measured by profits, revenues or any other financial quantity there are plenty of cases where organizations developed innovations but failed to achieve success.
When Telecom Italia first introduced the WAP (Wireless Application Protocol) it certainly represented a promising innovation. The WAP would bring the Internet experience closer to the mobile terminals, allowing users to access their bank accounts and receive various information about the weather, the traffic and the like.
The Italian telephone operator, however, handled the introduction of the technology with a strange approach. They tried to create all the content themselves, so that the profits would not be shared. The strategy turned out to be disastrous since the company was not able to produce quality content at a pace that customers were requiring. The company also failed to reach partnership agreements with other actors involved in the diffusion of the WAP.
Telecom Italia certainly developed an innovation with the introduction of the WAP, but it burned millions of euros along the way.