Outside Innovation: Traditional vs. Open Innovation

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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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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.

December 30, 2006

Traditional vs. Open Innovation « NextUp

Thanks to Doug Meacham in his "Next Up" blog for his mention of Outside Innovation Traditional vs. Open Innovation < Next Up.

Although he has just started reading the book, Doug was nice enough to say:

"Open innovation is one of the key trends in the world of business right now, and this book looks like a terrific guide to what it is and how to implement it in your company. This concept goes way beyond creating products that meet customer’s needs. Embracing the customer as a partner is a way to transform and elevate your brand. As competition increases and the ability to differentiate yourself decreases, are you asking your customers to help define your brand’s experience???"

Here, here!

Posted by Patty Seybold on December 30, 2006 in Books, Customer Experience, Customer Innovation, Customer-contributed content, Outside Innovation | Permalink

Tags: innovation

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Outside Innovation

New ways to engage customers in co-designing your company's future - a weblog to complement the book, Outside Innovation, by Patty Seybold

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December 30, 2006

Traditional vs. Open Innovation « NextUp

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