3 Cs of Innovation 2.0 - Crowdsourcing, Competition, Collaboration

3 Cs of Innovation 2.0
Crowdsourcing, Competition, Collaboration
Hutch Carpenter
VP of Product
@bhc3

2
What is this “innovation” you speak of?
Innovation: A change in a product offering, service, business model or operations which meaningfully improves the experience of a large number of stakeholders

3
Multiple Forms of Innovation
create new market
Low risk, many competitors
High risk, high reward
radical technology change
minimal technology change
Customer experience; cost savings
High risk, defensive strategy
manage existing market

4
Innovation = ROI
Leading innovators generate 430 basis points more in shareholder return than do average companies
My entire year has been a quest to find quantifiable ROI… Finance agreed - it ain't easy.
Where we did quickly find quantifiable business value was during an ideation proof of concept. Ideas that are discovered and turned into action have produced dollarized return of business value.
Laurie Buczek
Social Computing Program Manager at Intel
All I Want For Christmas is my E2.0

5
Innovation 1.0: Two Centers of Innovation

6
Innovation 2.0: Employees Rule!

Crowdsourcing
7

8
Crowdsourcing? What is that?
Crowdsourcing: Soliciting the ideas, knowledge, experiences and judgment of a large, diverse group of people to solve a problem

9
Diversity of Inputs Drives Idea Quality
Diversity Means Quality
Prof. Ron Burt, Structural Holes & Good Ideas
Crowds of people, each calling on their own incomplete and private information, are able to arrive at optimal solutions as well as, or better than,a small group of smart people.
Diversity in crowds expands a group’s set of possible solutions.
Idea Assessment
James Surowiecki,
The Wisdom of Crowds
high diversity of connections
low diversity of connections

10
Crowdsourcing Brings Edge Perspectives In
customers
customer service
customers
IT
marketing
R&D
account mgt
manufacturing
sales
product
finance
customers
customers
field operations

11
Three Models of Crowdsourcing
Crowdsourced Submissions
Crowdsourced Feedback
Selection by Experts
Crowd Sentiment, Expert Decision
Crowdsourced Selection
Crowd Decision
Selection by Experts
Expert Decision

12
Crowdsourcing Isn’t Immune from the 1:9:90 Participation Ratio
Estimated distribution of employees’ propensity to share ideas
Number of Employees
typical idea suggestion curve
Propensity to formulate & submit ideas
low
high

13
Goal-Setting Changes the Participation Ratio
Goals Stimulate Employee Idea Sharing
Number of Employees
goal-driven ideation curve
ideas increase due to goal-setting
typical idea suggestion curve
Propensity to formulate & submit ideas
low
high

14
Why Does Goal-Setting Work?
1. Signals increased management attention to ideas on a topic
2. Sets an expectation of participation
3. Establishes a target the community can rally around
4. It creates an event orientation

15
Goals Must Relate to Tangible Outcomes
Product Delivery Value Chain
Product Design
Procure-ment
Manu-facturing
Distribu-tion
Marketing
Customer Experience
What are the top emerging use cases of our product?
How do we increase throughput by 10%?
How do we increase fleet fuel efficiency by 10%?
How do we increase customer sat. scores 20%?
“Used in development of green technology”
“Reduce truck idling time during morning loading”
“Pre-build components for later install”
“Route service calls by component, not vertical”

Competition
16

17
Two Senses of Competition
System Competition
Individual Competition
Competition: Process of determining how a finite resource will be allocated among a set of alternatives
Competition: Actions taken to advance in a given endeavor, satisfying one’s internal need to excel

18
Innovation Thrives on Soft Competition

19
Marketplace Competition for Best Ideas
Competition reduces innovation friction

20
Paragone Creates an Innovation Meritocracy
During the Renaissance, paragone implied the placing of two artists’ individual works side by side in order to judge them, weigh them, distinguish them, and critique them.
Sofia’s idea
Using rivalry to spur innovation
Bernard T. Ferrari and Jessica Goethals
McKinsey Quarterly
Wisdom of the crowd distinguishes among submitted ideas
Maximo’s idea

21
Paragone Creates Performance Curiosity
Greater freedom to innovate and decide which ideas are best leads naturally to a desire to better understand one’s own performance.
Feedback
benchmarking
recognition

22
Game Mechanics Are Performance Metrics
…Translates to
Activity…
Authoring
activity currency
Interacting
collaborator badge
Positive Feedback
reputation score
Professor Andrew McAfeeShould Knowledge Workers Have Enterprise 2.0 Ratings?

23
Game Mechanics Are Reinforcement
Behavior achieved is what you actually reward. Pavlovian but true. To achieve full value of 2.0 need tech + culture.
I would suggest that @ replies in twitter trigger a dopamine response. And thus the addiction. Who's with me? /via @cammybean /// I am :)
Laurie Buczek (tweet)
Social Computing Program Manager
Intel
Claire Flanagan (tweet)
Senior Manager, Enterprise Social Collaboration
CSC
Social incentives reward and reinforce the goals in innovation

Collaboration
24

25
When I Say “Collaboration”, I Mean…
Collaboration: Building toward a defined outcome through the interactions and input of multiple people

26
Typical Collaboration Is Poorly Suited for Innovation
Standard collaboration group formation is…
…great for project execution…
…but limiting for innovation.
Group Composition and Decision Making: How Member Familiarity and Information Distribution Affect Process and Performance, 1996 (pdf)

27
Collaboration Based on Emergence

28
Innovation Requires Emergence and Structure
Emergent Collaboration
Structured Collaboration
crowdsourcing
competition

29
Reward Innovation Collaboration as Much as Idea Origination
What people focus on
Need to make collaboration as important as origination
The work that makes eureka possible
The Work of Innovation
Scott Berkun
Author, The Myths of Innovation (pdf)

30
Make Collaboration Sexy and Worthwhile
Purposeful Work
Stokes one’s passion
Part of project team
Solves a burning issue for me
Social Incentives
Community feedback on your input
Milestone achievements
Reputation rating
Recognition
Acknowledge team, not just originator
Publicize collaboration achievements

31
Spigit: Innovation Driven by Enterprise 2.0
spigit.com
Hutch Carpenter
VP of Product
@bhc3

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3 Cs of Innovation 2.0 - Crowdsourcing, Competition, Collaboration

by Hutch Carpenter on Jun 21, 2010

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3 Cs of Innovation 2.0 - Crowdsourcing, Competition, Collaboration — Presentation Transcript