Why Cheap Experiments Are Worth More than Good Ideas

Ideas are the wrong unit of measurement for innovation, says Michael Schrage, author of The Innovator’s Hypothesis. This is because so many ostensibly “good ideas” are a drain on capital that eventually end up going nowhere. Instead of investing in ideas, Schrage recommends reframing them as testable hypotheses that can be run in a fast, simple, cheap business experiment. It’s out of these that firms and innovators acquire the most value.

By far the most controversial thing I wrote in the b...