Tuesday, March 12, 2013

The User Innovation Revolution

“What if much of what you know or think you know about the innovation process is wrong?”
That’s a question Eric von Hippel, a professor of technological innovation at the MIT Sloan School of Management, thinks companies should consider. According to him, ideas for new and improved products generally come from the users who develop improvised versions to serve their own needs. Companies then may discover, polish and commercialize those ideas particularly if they are accepted by a group of users.
After reading this week’s articles on next industrial revolution, it seems that mainstream companies have started to realize the user innovation’s potential. In this blog, I will illustrate some more examples and advantages of letting your customers design your products.
Making of Fiat Mio
Brazil’s most popular automaker, Fiat instead of using the expertise of its core team of designers and engineers, let its users design the look of their car - Fiat Mio. They received 10,000 suggestions on the car’s design from people in more than 160 countries. According to Carl Esposti, founder of Crowdsourcing .org, Fiat Mio is a great example of what companies can accomplish by crowdsourcing. Crowdsourcing help companies to think outside the box and gather more new and innovative ideas rather than just relying on the abilities of a limited staff of employees. This approach can be extremely useful for companies (especially for small start-ups) to provide desired value to their customers. In the videa below, Manager of style centre in Brazil and a few other managers are taking about this innovation and about how this process is so different and unique.


Invent with Nokia
In 2011, Nokia also launched "Invent with Nokia," a program that invites future inventors to submit their ideas on new and innovative technology inventions. Nokia will pay the inventor and would prototype the design if they like the inventor’s idea. In the video below, Stephen Elop, CEO of Nokia, talks about this program and their belief about finding potential investors outside Nokia.


A number of young start-ups like Ideaken are also breaking into the crowdsourcing ideas strategy to essentially take their internal struggles to a broader stage, and let the world have an attempt at solving various problems. Founded in India by Jayesh Badani, Ideaken  is basically a software platform where both enterprises and individuals collaborate to find solutions. They follow a three step process:

1. Companies submit a challenge.
2. Company can then collaborate with a network of "solvers".
3. The problem-solver is paid for his work

Some of the benefits of Crowdsourcing Ideas
User innovation is cheaper for companies as the users are actually doing product innovation using their own resources. Manufacturers also can decide which user innovations they should improve and commercialize based on market response. A nice example of this is LEGO. It allows its users to post their LEGO designs and to even sell what they have designed on their website. Then they see how much they sell and if something becomes really popular, they license it from the users.
All the above examples indicate that users have a huge innovation potential. But you may have this question in your mind as I did - Are there any specific users who are more likely to innovate? Where can the manufacturers find these innovators?

Eric Von Hippel has beautifully answered this question in his article for all the manufacturers looking for such innovators. He calls these innovators as the lead users - sophisticated users who are the most likely to innovate to satisfy their own needs.  So you can find your innovators among the users who have the problem and are trying to solve their problem. For example, in a case study on his MIT website, 3M was searching for lead users in infection control. They discovered that surgeons who treat cancer patients had come up with improved infection control methods as often their patients were immune-compromised and were really getting bad infections. So, if there is someone who would have developed and tested a good solution, he must be a “lead user”.
[4] http://sloanreview.mit.edu/tag/eric-von-hippel/

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