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Innovation Diffusion - Feature Films and Episodic Television - Sept 2011 - Dave Litwiller

Innovation Diffusion - Feature Films and Episodic Television - Sept 2011 - Dave Litwiller

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Published by davidjl
Go-to-market and organizational development considerations for technology vendors pursuing feature film and episodic television production and post-production.
Go-to-market and organizational development considerations for technology vendors pursuing feature film and episodic television production and post-production.

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Published by: davidjl on Sep 18, 2011
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Innovation Diffusion in Production of Feature Films and Episodic Television:A Roadmap for Purveyors of New Technology
David J. Litwiller September, 2011The innovation diffusion rate in project-based industries has been studied by respectedacademics
. The trigger observation for this research was that innovation diffuses moreslowly and haltingly in project-based industries such as feature film and episodic TV production than in traditional vertically integrated industrial and commercial ecosystems.Project-based industries are characterized by major development projects being carriedout by teams of independent contributors from outside the sponsoring firm. The teamcomes together for the project, and then disbands afterward. The project-based nature of these industries has significant go-to-market and organizational development implicationsfor purveyors of new production technologies in order to maximize adoption speed,revenue growth and profitability.The following summarizes academic research and empirical evidence describing thecauses of cautious adoption, and goes on to detail the highest impact ways to enhanceadoption of new technologies in the project-based, production industry of mainstreammovies and episodic television:
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Much of Hollywood is about risk avoidance and de-risking. Many projects sputter  because of non-technical factors such as audience whim and executive discretion.People do not want to compound this natural environmental risk with additionaltechnical risk. There is a pronounced tendency for people to want to be the secondto use the new, rather than first.
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In movie and TV production technology, incremental innovation (one person or one business making an isolated change) happens much faster than systemicinnovation (adaptations requiring changing work methods and platforms for multiple people spanning multiple businesses).This arises from:
The lateral nature of Hollywood (rather than vertical integration) making itharder to get everyone on the same page for changes that crossorganizational boundaries,
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Maturity of the industry, meaning much spending power and managementtime among major players are dedicated to similar problems,
Oligopoly of the major studios, dampening competitive intensity to try toget ahead with new technologies, and,
Project-based nature of content creation. Teams re-form from project to project, changing stakeholders. Decision team reconstitution brings the“solidarity of three+” problem in risk assessment about carryinginnovations from past projects to new ones. This is where an advocate for a risky position potentially faces several opposing people. Also, project- based work with team reform each project means intellectual propertymoves around, lessening the incentive for businesses to invest indifferentiating technological or work-process intellectual property beyonda minimum competitive threshold.
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Adoption S-curves of multiple technologies are underway simultaneously,competing for finite capital expenditure, R&D and training dollars, as well asappetite for risk, especially in a fixed, mature oligopoly. Innovation moves faster when it has fewer competitive s-curves of conviction or there is more rapid growthto fuel investment enthusiasm.
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Empirically, systemic innovation diffuses at half to a quarter of the rate of incremental innovation in Hollywood. Even among technologies destined for long-term adoption success, it is common for systemic innovation to take four years from launch until the 10% penetration point into the accessible market isreached. Beyond the onset phase, a further twelve years is typically required to progress from 10% penetration to 90%. The inertia of systemic work methods andwork flows do not allow “tipping point” moments of rapid turnover to the new.This time scale can come as a shock to technology entrepreneurs and those whohold them to account whose backgrounds may be in other technology applicationmarkets with dramatically faster adoption and change patterns. An adoption timeconstant in the vicinity of half a decade brings with it a necessary bias towarddeferring fixed organizational costs, sometimes for years, until product-market fitis established, the resounding value proposition is known and validated, whenscaling of the business beyond a small missionary team first becomes appropriate.
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Faster take-up comes in part from innovations that are widely perceived to yieldstronger revenues, due to hit driven nature of Hollywood (the biggest successescover the losses from a large proportion of projects which are financial flops, andstill provides an overall investment return). Adaptations in technology or work methods with strong financial performance for early projects are widely andrapidly imitated. The challenge is that attribution for success is often subjectiveand spread among a variety of factors (such as script, genre, actors, topicality,director, VFX, etc.), making it often a challenge to get sufficient credit assigned toa new technology.
© David J. Litwiller, 2011
 
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Operating cost savings from a new technology are usually not as compelling todrive widespread user adoption as revenue enhancement. Empirically, operatingcost savings tend to be partially diminished by sloppier, wasteful usage patternsduring production and post-production rather than maintaining disciplined work methods to deliver ultimate savings. Revenue expansion doesn’t experiencesimilar erosion.
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Best technology take-up comes from innovations with a learning curve which can be completely traversed in one project. Otherwise, inability to get consistent usefrom project to project slows the transfer of tacit knowledge dramatically to attainfull efficiency with the new technology. Where the learning curve spans multiple projects, then team reconstruction from project to project compounds slowness of adoption because of both “solidarity of three” as well as inadequate availability of sufficient apprenticing time.
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Because of how resources are marshaled in Hollywood to initiate a content-creation project, and the high statistical fall-out from inception to approved production, the fastest technologies to be adopted are those that are seen to lift thelikelihood of reaching “green lit” status from the studios.
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The project-based nature of work means that first adoption can happen quickly,since risk for stakeholders is limited to just one project. At the same time, thespread of advantageous mutations in work process and technology can beforestalled especially if there is any undercurrent of disappointment with early project results. Evidence of first use, even enthusiastic, has significant head-fake potential with respect to rapid follow-on spread of usage.Influence, Promotion and Intervention to Accelerate AdoptionWith these observations and factors in mind, there are several model communication andintervention implications to promote a new technology:
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Show how better revenue came from early projects using the technology.
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Make one of the most influential prospective users a partner in development and pilot usage. The most respected and connected people have immense impactthrough persuasion and social proof over how others will go about production of movies, episodic television and big budget commercials.
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Show how all key players felt early projects were de-risked or otherwise enhancedfrom using the new, such as the producer, director, cinematographer, script writer,and perhaps even the art director.
© David J. Litwiller, 2011

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