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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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    « The Big Idea: Focus on Customers' Outcomes! | Main | SPOTLIGHT ON OUTSIDE INNOVATION AT THE BBC »

    October 11, 2006


    Patty Seybold

    Thanks, Brenda..

    It sounds as if Hurley understands how to navigate this slippery slope pretty well.. He started by building a huge community of customer-generated and customer-pirated content. With no ads and no monetization but great fans, great traffic, great buzz! Having started by building traffic and buzz first, now they can offer monetary rewards for really good customer-generated content.

    Google/YouTube also need to figure out how to compensate those broadcasters and movie producers whose "customer-pirated" content forms a huge part of the YouTube ecosystem. While many content providers are thrilled to have their content handpicked and posted by customers, since it provides a PR benefit, other content owners have insisted that Google either remove the pirated content or pay them for its use.

    Thanks for the link!

    brenda michelson

    hi patty, did you see this yet:

    "YouTube CEO Chad Hurley said today his company (now owned by Google) “is going to move in [the] direction” of rewarding video creators for their content, as part of a panel discussion at the World Economic Forum meeting in Davos."

    Here's the link:

    The comments to this entry are closed.

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