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  • What is Outside Innovation?
    It’s when customers lead the design of your business processes, products, services, and business models. It’s when customers roll up their sleeves to co-design their products and your business. It’s when customers attract other customers to build a vital customer-centric ecosystem around your products and services. The good news is that customer-led innovation is one of the most predictably successful innovation processes. The bad news is that many managers and executives don’t yet believe in it. Today, that’s their loss. Ultimately, it may be their downfall.

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    Observations

    • LEAD USERS
      Eric von Hippel coined the term "lead users" to describe a group of both customers and non-customers who are passionate about getting certain things accomplished. They may not know or care about the products or services you offer. But they do care about their project or need. Lead users have already explored innovative ways to get things done. They're usually willing to share their approaches with others.
    • LEAD CUSTOMERS
      I use the term "lead customers" to describe the small percentage of your current customers who are truly innovative. These may not be your most vocal customers, your most profitable customers, or your largest customers. But they are the customers who care deeply about the way in which your products or services could help them achieve something they care about.
    • LEAD CUSTOMERS AND LEAD USERS
      We’ve spent the last 25 years identifying, interviewing, selecting, and grouping customers together to participate in our Customer Scenario® Mapping sessions. Over the years, we’ve learned how to identify the people who will contribute the most to a customer co-design session. These are the same kinds of people you should be recruiting when you set out to harness customer-led innovation.
    • HOW DO YOU WIN IN INNOVATION?
      You no longer win by having the smartest engineers and scientists; you win by having the smartest customers!
    • CUSTOMER CO-DESIGN
      In more than 25 years of business strategy consulting, we’ve found that customer co-design is a woefully under-used capability.
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    « How Customer-Centric Visionaries Make Information Valuable | Main | Google Wave: It’s "My" Design, but Will I Use It? »

    June 03, 2009

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    Comments

    Customers can see a product that someone else has customized and reuse those patterns to create their own customized product. Thanks ;)

    Dave

    Consider the fundamentals of being a customer.

    In a barter system (such as ours), we trade.

    There are no customers. Only value creation and trade. One team takes wheat seeds and water and transforms it into bread. While another team takes grape seeds and squashing and transforms it into wine. Then they trade.

    So maybe your approach to customer participation is this:

    - A value creator wants a certain quality of value.

    - That value creator informs their trading partner (whose team creates that particular variety of value) exactly what they want.

    -The value creator takes heed, and produces exactly that quality of value.

    -The creator of that new variety of value sells all of their inventory and does it again and again.

    -The trader gets exactly what they want in the trade.

    In other words, it all comes down to the value creator answering the question "What do you want in exchange for the manifestation of all your hard work and creative, inventive effort?" And then going boldly into the market place and making it happen...

    Dave

    Mr. Dell and his corporation sold me a $2,711 computer four years ago - with extremely loud processor fans. If you google "Dell" and "XPS" and "Gen3" and "Loud" you will find out everything you need to know from the customer end.

    The problem is, Mr. Dell shipped the computer with a heat sink that does not dissipate heat. And therefore the processor fans run at extremely high RPM's in a vain attempt to bring down the temperature.

    I am not a computer repair person, nor am I employed by Michael Dell as a Quality Assurance engineer. Therefore it took me awhile to figure this out.

    But now that I have, I can see that Mr. Dell and his team made a costly mistake. Costly, at least, on my end. My wife and I have been paying for four and a half years. (Not to mention all the clients who just assumed we were talking on a pay phone at the airport next to where the jets take off.)

    Now that I have pointed out Mr. Dell's (what I am certain was a rare) error in judgement, I wonder how long I will have to wait for Mr. Dell to make it right?

    Anyone wanna bet? I take tomorrow. I bet he will fix it tomorrow. The answer upon which I bet my money is that Mr. Dell will fix his mistake and take me back as a loyal customer tomorrow. (Or the day after.)

    Any takers? My two cents are on the table...

    Dave

    Remember the scene? Harold was realizing the depth of his feelings for Maude. He watched her play pinball with a gang of biker dudes (as I remember it) and they were all laughing and having a very good time. Harold said to her in the next scene "You sure are good with people!" And remember what she said? Maude said, in the voice of an excited little girl, "they're my species!"

    Classic.

    Yes, we of the same species learn from one another. I hope. One of the things we learn is fairness. Then laws and rules right after that to corral those who lack the fairness compass. Then we regulate the rules.

    (Perhaps one day we will grow so sophisticated that we watch out for arrogant, obese radio show hosts who encourage us to deregulate. That pretty much always spells some kind of trouble.)

    As we grew as a species, we taught each other about Adam Smith and making pins. And then some of us read Dickens and we paid attention, and some of us read Upton Sinclair and we didn’t, and first thing you knew there was a yoke around the worker's necks and a whip on their backs.

    To counterbalance that whole mess - the corporation was born.

    Community ownership of stock. Professional managers. Profit maximization. Adam Smith in a can...

    Only after the corporation proved to be as prone to indulgent foolishness as raw Capitalism and raw Marxism, was the “Issues Resolution, Interactive, and Fully Commented” TALK WITH US blog invented.

    One such widget now resides right on the home page of every corporate web site. ("Products" "News and Events" "Contact Us" "About Us" "Talk With Us")

    That invention brought customers and businesses into synergy.

    If GM had implemented it, when they shipped bad products and the MBA's said the best thing was to just shut up and pretend it was not happening, the customers could have gotten through to them.

    Maybe they could have self-corrected, before they learned the ultimate lesson that while profitable in the short run, their strategy was corporate suicide.

    Unedited. Uncensored. Corporations now resolve their dirty laundry right on the home page. When a valued customer brings up some stupid thing they did, hits them clean between the eyes, the successful corporations – the ones with all the customers flocking to do business with them - feature it with bold text.

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