Getting the jump on your competition is as simple as knowing what your customers want. If so, empathy, not just innovation, is crucial to success. Comparing the success of two Microsoft products, Xbox and Zune, Business Week's piece "Empathy is Growth" nails one key difference between unsuccessful and successful innovations.
Why was Microsoft able to create such a compelling video game system only to churn out a mediocre portable music player? The competitive context was the same. The research was similar. The design and engineering resources brought to the challenge were significant in both cases. What makes a company deliver a bravura performance one day and fall flat the next? Empathy. As one member of the team confided: 'The biggest challenge with Zune was trying to figure out who we were building it for. With Xbox, we knew those guys. Hell, we were those guys.'
There is no better strategy than a real understanding of people outside the business. Empathy can be meaning and means.