New ways to engage customers in co-designing your company's future - a weblog to complement the book, Outside Innovation, by Patty Seybold
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.
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.
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!
In more than 25 years of business strategy consulting, we’ve found that customer co-design is a woefully under-used capability.
This week’s main merger
news—Dell’s $3.9 billion cash deal for Perot Systems—caused a flurry of
discussions in our Pioneers’
group, since Perot Systems’ CTO,
Jim Stikeleather, is one of our Ur-Pioneers. (Jim hosted our first 2-day Patty’s Pioneers’ meeting in the early
1990’s.) Of course, Jim couldn’t comment on the news, but we all had fun
speculating about how the combined Dell/Perot Systems combination will
transform Dell’s business (and the computing landscape). My take: Dell and
Perot Systems will make a powerful combination as they shepherd clients into
the brave new world of cloud computing powered by Dell hardware. Many of Dell’s
customers are Linux-friendly and cloud-aware.Perot’s services business is well-positioned in healthcare and
government to reap the bounty of the U.S. government’s current obsession
with health insurance “reform.”