Much like a teenager who starts playing a new video game without bothering to open the manual, he tried things and observed the results, abandoning whatever didn’t work and moving aggressively to exploit small successes. A profusion of ideas spewed forth from his mind. There was no such thing as a bad idea, apparently. But, perhaps, more important, there was no such thing as a good idea either, until it had been tried and coolly evaluated. It was clear how he had become the leader of a sort of gang back home: not by asserting his leadership but by being so relentless in his production, evaluation, and exploitation of ideas that his friends had been left with no choice but to form up in his wake.

It’s a great quote, and there are several crucial points about innovation in it:

• Prototype everything: the character being described was learning how to sail a boat after being left adrift. He did this by prototyping. We can prototype any type of innovation – a new product, a new service, or a new business model. Actually, it’s not just that we can prototype everything, it’s that we must prototype everything.
• We can win by experimenting faster: this is the principle drives John Boyd’s OODA loop. OODA is a method for winning in complex environments. It stands for Observation; Orientation; Decision; Action. Boyd’s idea is that if you go through this process faster, you will gain a competitive advantage. He developed the model to help fighter pilots, but it has been shown to work in business as well.
• There’s no such thing as a good idea, until it’s been tested: an unexecuted idea has no value at all. It’s not a good idea until we know if it will work or not. It’s a simple point, and an important one, and it’s often overlooked.

Stephenson has outlined an outstanding innovation strategy: prototype everything, experiment as quickly as you possibly can, and don’t think you have a good idea until you’ve tested it. Three steps for innovation success.