Innovators today are told to run loose and think lean in order to fail fast and succeed sooner. But in a world obsessed with the new, where cool added features often trump actual customer needs, it's the consumer who suffers. In our quest to be more agile, we end up creating products that underwhelm.

So how does a company like Nest, creator of the mundane thermostat, earn accolades like "beautiful" and "revolutionary" and a $3.2 billion Google buyout? What did Nest do differently to create a household product that people speak of with...