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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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      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.
      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.
      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.
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    « Early Book Fodder | Main | Why CRM Doesn't Work »

    December 01, 2005


    Patty Seybold

    You're right, motive IS important.. It's all about what I need/want to do (what I call a Customer Scenario) and the Experience of getting that done... It turns out, of course, that some times I want to play/explore/learn--not do something directed. Or, even if I have a task in mind, like buy a gift for someone, to use your Amazon analogy, I want to have fun doing it.. Increasingly, having fun means getting to do it MY way.. creating or customizing something.. or having fun means interacting with others.. as in this blog experience..

    So thanks for the link to Mark Pesce's Playful World site. He has a great site to support his book of the same title.. really nicely designed and interactive.. unfortunately, since the book was published 5 years ago, the book site has been taken over by folks who have posted pornographic stuff and some of the links no longer work, but it's a great lesson in how to let readers follow along in your research/thought processes...

    Happy New Year to you!


    Hi Patty - Happy New Year Patty- and Happy New Year to all you brilliant folk what read this brilliant site...its way cool...Patty you honor me by being so thoughtful and thorough in your responses. Our research is in the realm of CRM so your postings on that have really been helpful, thank you. Kurzweil is kind of cool - I also like Mark Pesce ("A Playful World") simply because it seems to me that much of what we are dealing with at all times is MOTIVE. Establish the motive, move the motive, now we say that we are allowing the customer to get into the game in a formidable way, via the technology, which is true...but actually - Pesce has a very real point...the motive is the fun of it all- to a large extent, wouldn't you agree? I mean - we tend to lose sight of how much fun it is to dial out to Amazon, get that gift - have it arrive- and everything be great- without the hassle of going to a store? But also...our technology is fun...and that's a factor it seems to me...and hence Pesce hit it on the nose I believe...anyway...deeply appreciate the using them like a big dog..even though I be a pup...


    Patty Seybold

    Thanks for the clarification. That will make it easier for me to read/digest Ray's latest oeuvre. Connectedness and the seamless connection with technology is definitely a huge enabler of customer innovation. I am seeing it everywhere--from the girls school in Uganda previously illiterate 12-year olds are now posting tips on organic farming online--to the designers who win the Threadless T-Shirt design competitions the "freeformers" who prefer to borrow and lend from one another via Zopa, rather than from their banks. All of these customer innovation capabilities aren't just enabled by technology, but they only work because technology and the ability to connect via technology has (finally) become seamless enough that it's in the background--just part of our infrastructure. Good point!

    Patty Seybold

    Thanks for the tagline suggestion. It's pretty close to what we seem to be gravitating towards.. You're right that the tagline needs to capture the inevitability of this trend! Yours does that nicely...

    I wonder where Expedia's customers will take you next? Possible book fodder??

    Thanks for the private email tip re: your wife, Jeanne Bliss, upcoming book, Chief Customer Officer: Getting Past Lip Service to Passionate Action. I can't wait to read it!

    Thanks, too for the link. I've already pre-ordered it. (I love One-Click!)

    Bill Bliss

    Here's a tagline suggestion for you... "Let your customers take your business where they want to go." The "they" could be italicized or perhaps even all caps. Happy Holidays!

    Dana Richardson

    Merry Christmas Patty- I'm such a newfer to this blogging business...but want to attempt to do an answer...hope it will be useful?

    Great question and counterpoint - the phase that Dr. Kurzweil is explaining touches the consumer in many differing ways. Connectedness is likely one of the metrics which we observe, as the totally seamless interaction with technology; as it comes into being. It is with such indicators (as Kurzweil points them out) in mind that it seems prudent for those of us who use, examine, research and report on the current state of the technology, to do so with as well informed and wide angle a viewpoint (regarding the potentials for the future of that technology) as we are able to bring into our methodology. You are right about Kurzweil being a bit daunting - but, other than Naisbitt, Kurzweil is as accurate in his appraisal of the future as predictability, seemingly; allows for. It is his science approach which I find fascinating. So to bring your question to point and focus, it seems to me that connectedness and the seamless nature of what we are arriving at technologically, is where I see customer innovation being a dominant factor in the singularity. Hmm, there is an article subject in there somewhere... now if I could just write that pup and sell it....

    -Thanks for being a considerate author..


    Patty Seybold


    Thanks for the offer of being a reviewer! I would love to take you up on that. In particular, I'd value your input re: the open source collaborative model and how you see it being applied outside of the software realm.



    If you are seeking reviewers for your manuscript, me and my coworkers will gladly provide you with candid feedback...

    Patty Seybold

    Thanks for the link to Ray's book. I haven't read it. It looks fascinating but daunting. Before I wade into it, what's the connection that you see between Singularity and Customer Innovation?


    Dana Richardson

    In your literature search did you take in Kurzweil's book on the singularity being near?

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