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External Innovation Communities

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    Notes on slide 1

    This contrast is a classic military metaphor. Castles are fixed and protect a specific location. They are a place you bring in your forces and defend against an attack. They are defensive in nature. Ships are both defensive and offensive in nature. They can protect your coastline or harbor, but can also be used for attack or discovery. These concepts have a high correlation to innovation. Traditionally it’s been the model that most innovation happens within the “four walls” and we kept a clear divide between what our scientists and engineers created and any ideas that might be provided from the outside. Now, many firms recognize the value of interaction with customers, business partners and channels, and seek a robust external innovation community.

    The Good news – unlike a lot of my other presentations, I don’t have to encourage you to start innovating. The question in front of us today is: how can we get the most out of our communities, especially considering external communities? Many of the factors are the same – who to invite, what scope and definition to provide, what outcomes are desirable. What adds excitement and interest to these potential external communities is the promise they offer for new ideas and new dialog with your customers and prospects. What’s a bit challenging about these external communities are the expectations your customers have about participating with you.

    Before we plunge into the discussion around communities, let’s first set our definitions. We believe that innovation can be defined as “people putting ideas into valuable action”. The definition accounts for private, commercial firms that are innovating for profit, as well as non-profits and governments where the outcome may be increased services or benefits. This raises a couple of questions. Where do ideas come from and how many do we need? Who generates those ideas? Which challenges and opportunities are the most valuable? Who decides? External communities can help address a lot of these questions, which means they can play a powerful role in innovation for your firm.

    We’ve identified five benefits of using external communities for innovation. Your team will get a new, and different perspective on what opportunities or challenges exist. Too often we innovate from the “inside out”, based on what our strengths are or what we believe customers need. Working with a community we gain insights from in outside in. A few employees may generate ideas occasionally, but customers and prospects can generate a lot of ideas quickly and over time. The volume and “flow” of ideas can increase dramatically Your customers and prospects will generate ideas and identify opportunities or concepts that are simply different than the ones you’ll have internally. You can begin to identify passionate, committed users of your products who may become “lead users”. Those are people who can identify new uses for your products or new markets You can obtain more feedback on the value, the importance and the relevance of ideas from the “Crowd”.

    So, there are five items where an innovation community (internal or external) can be helpful. You can get better insights and perspectives, obtain more ideas more quickly, gain a better sense of the uptake of the idea and whether or not an idea solves a recognized problem. You can generate ideas more quickly and more consistently over time.

    There are several reasons why an external community may not be a great idea. You won’t save much money – in fact it will cost more to run and manage a community. Don’t think your customers are necessarily more innovative – you’ll still need to wade through the ideas and find the best ones and the community will need guidance from you.. You cannot completely abdicate the innovation program to your customers, and you won’t identify many disruptive ideas within a community due to the pull of the crowd and the attraction to the mean.

    We believe there are two decisions to make about the structure of a community, internal or external, but when considering an external community these decisions become more important. The first decision is based on how ideas should be generated. A community can be “suggestive” – that is, the community can suggest any idea, or can be directed. A directed community solves specific challenges that originate from the managers of the community. The second decision is who can participate in the community. Can anyone participate? Or only certain individuals or firms? This decision has an impact on the kinds of ideas, and also concerns intellectual property. Next, consider whether your firm has the energy or the stamina for a continous community, constantly generating and submitting ideas. How much control does your firm want to have over the community? What are the options? What outcomes do you expect from the community? How much “work” do you want to place on the community to define and validate their ideas? What can you expect from a community?

    Using the two decisions we identified previously, I’ve placed them on this graph and used some examples to illustrate the different products/examples/communities that exist in some of these quadrants. Dell’s IdeaStorm and IBM’s Idea Jam are two products that are mostly suggestive, while communities that have a specific focus or context, like a LinkedIn community or a relationship with a trusted partner are more directed and specific. We’ll examine each segment in a little more detail, pointing out the strengths and challenges of each approach.

    The point here is to be intentional about your methods, decisions and choices. Depending on the kinds of ideas you want, the volume of ideas you want and the other goals you have for the community, you will make different choices.

    Setting up a community also means making commitments to the individuals in that community. How frequently will your team participate? How much effort will go into reviewing the ideas and selecting ideas for further investigation? Can you sustain a realistic engagement over time, or is an event or need based campaign program better for your team?

    How involved do you expect your team and your organization to be? Are you trying to solve very specific problems and have some solutions in mind? Are you open to see what the community may create?

    What do you want the community to deliver? You can have the community respond with nothing more than a few sentences around an idea, or with detailed drawings, sketches and plenty of market research completed. You’ll need to communicate your expectations and what the minimum, or maximum, amount of information that’s acceptable.

    As noted previously, you need to recognize going in that an active community requires involvement and engagement from your team. A community will not “run” itself and will want interaction with your team. Your organization may have rules about moderating a community to ensure nothing that is said or posted is inflammatory or illegal. If your team isn’t ready to commit the resources to engage a community, don’t start one. The anger and “betrayal” could damage your firm’s reputation.

    Once you open the doors, you can’t put the horse back in the barn. Expect to see people on social networks talking about what you are doing. Understand that a “public” open innovation forum is just that, and people from your partners and competitors will be watching those sites as well. Understand what’s being said.

    You don’t control the community, but you can communicate with the community and give it direction and feedback. Except in the case of the open/suggestive community, you can “talk” to the community and provide insights into your key goals or challenges.

    Except for the directed/invitational programs with trusted partners, IP issues abound. You need to involve your IP team to ensure ideas that are submitted in good faith don’t belong to someone else, and that there are clear stipulations about any ideas submitted and their provenance and ownership.

    Just because you’ve got an idea generation engine at the front of your process doesn’t mean you can neglect the “back end” process of evaluating and selecting ideas for further development. Put the process in place before you open the community, otherwise you won’t be able to capitalize on the ideas or implement them and you will frustrate the community.

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    External Innovation Communities - Presentation Transcript

    1. Innovation and Communities Benefits and Tradeoffs August 14, 2009
    2. Overview
      • Introduction
      • Why use a community?
      • Considerations
      • Differences external versus internal
      • Integration and staffing
      • Other Benefits
      • Wrap-up / Questions
    3. Introduction
      • I’m Jeffrey Phillips, VP at OVO Innovation
      • OVO is an innovation consulting firm focused on building innovation competencies in Fortune 5000 firms
      • I’ve lead innovation projects at WellPoint, H-P, AIG, T. Rowe Price and other Fortune 500 firms
      • Wrote “Make us more Innovative” and blog at Innovate on Purpose
    4.  
    5. OVO Capabilities
      • We help firms Innovate on Purpose™ by defining strategic goals and implementing consistent processes
      • Our capabilities include:
        • Linking innovation to strategic goals and intent
        • Trend spotting, synthesis and scenario planning
        • Qualitative market research – voice of the customer and ethnography
        • Facilitated Idea Generation
        • Defining and implementing innovation processes and metrics
        • Innovation Training
        • Addressing cultural barriers such as compensation, rewards and recognition and communication
        • Innovation Communities / Campaigns / Challenges
    6. Innovation Communities
    7. Ships and Castles
      • You’ll see my transition slide uses the metaphor of ships and castles
      • Classic military argument: defensive or offensive strength?
      • It’s also a metaphor for innovation. Internal knowledge or external engagement
    8. Don’t have to convince you
      • Already using Spigit to drive internal communities
      • You may be ready to launch an “external” innovation community
      • If so, what is your intent, your goal and your purpose?
      • What are you willing to share and to invest?
    9. Innovation
      • Innovation is putting ideas into valuable action
        • Where do the “ ideas ” come from? How many? How frequently?
        • What helps determine which ideas are valuable ?
        • Which opportunities or needs should we address?
        • How interesting or valuable is the opportunity?
        • How can we get to market faster?
      • External communities can help answer these questions
    10. External Community Benefits New, different perspective Volume Better, different ideas Lead Users Wisdom of Crowds
    11. Rationale
      • Insight - How much more (or better) insight exists outside than inside the company?
      • Bandwidth - Can the crowd generate more ideas more quickly? (also a question of culture)
      • Value - Can the crowd identify ideas that are more likely to be valuable or interesting?
      • Speed – Are we using communities because we can generate ideas more quickly externally?
      • Continuity – Are we using communities to receive ideas over an extended period of time?
    12. Not so great Rationale
      • Cost Savings - Are we using this as a cost saving method?
      • We’re not very innovative – so maybe our customers are
      • Strategic Abdication - Are we using this method in lieu of making strategic decisions? (“Customer-led”)
      • Radical/Disruption - Unlikely to see many disruptive or radical ideas in a public forum
    13. Implications
    14. Decisions
      • Structure
      • Continuous or event driven
      • Control
      • Outcomes
      • Participation
    15. Structure
      • Suggestive versus directed
        • Do you allow your community to suggest any idea with no direction from your organization?
        • Do you wish to provide guidance and direction for the idea submitters? If so, how much?
      • Open versus invitation
        • Do you want to allow “anyone” to participate
        • Do you want to invite specific partners, customers or experts only?
    16. Some Solutions Trusted Partner Suggestive/Open Suggestive/Invitation Directed/Open Directed/Invitation Invitees Select Group Anyone Context Directed Suggestive
    17. IdeaStorm – Suggestive/Open
      • Benefits:
        • Anyone can submit ideas, lots of ideas
        • Diverse set of topics and opportunities
        • Get a sense of what the “crowd” wants
      • Challenges
        • Lots of ideas (IdeaStorm: 13,000)
        • The “crowd” can be influenced by a small minority
        • IP issues are difficult
    18. IdeaJams – Suggestive/Invitational
      • Benefits
        • Good ideas focused on a specific issue or topic
        • Short term and short shelf life
      • Challenges
        • Many ideas aren’t aligned to needs or goals
        • Gaining a diverse set of perspectives and viewpoints
    19. Linkedin Groups – Directed/Open
      • Benefits
        • More clearly define the opportunity, need or issue
        • Obtain more ideas that align to the need
        • “ Birds of a Feather”
      • Challenges
        • Intellectual Property identification
        • Reaching the “right” people with the right perspectives
    20. Trusted Network – Directed/Invitational
      • Benefits
        • Very specific insights and ideas about topics that are very strategic or important
        • Can share more details/plans with a trusted network
      • Challenges
        • Are we targeting the “right” or best opportunities
        • Is there a risk of groupthink?
        • Why different from a strategic partnership?
    21. Which works “best”
      • If your goal is:
      Incremental ideas Any Disruptive ideas Directed/Invitational Speed to deploy Open/Suggestive Gaining “wisdom” from the crowd Open Ideas tightly aligned to strategy Directed Significant number of ideas Open/suggestive
    22. Continuous / Event Driven
      • Continuous communities remain active over time
        • Do you have the resources to sustain the community and manage the ideas?
      • Some communities are event driven a response to specific topics or issues
        • Do you have the discipline to generate specific topics or campaigns on a regular basis?
    23. Control
      • What is your goal for “control”?
        • Tight control – active involvement by your team, guiding the participants, setting the agenda (Idea campaign or strategic partnership)
        • Moderate control – open to new ideas from prospects and customers (External community like IdeaStorm)
        • Loose or no control – building the framework and allowing the customers to determine what is important (Youtube/Open Source)
    24. Outcomes
      • Communities can deliver a wide range of outcomes
        • Wild ideas
        • Answers to questions
        • Solutions to specific problems
        • Highly evolved technologies or documented IP
      • What are your expectations? What are your needs?
    25. Participation
      • “ The way to get a good idea is to first have a lot of ideas” – Linus Pauling
        • Communities offer the ability to gain a lot of ideas from a lot of people
        • However, research indicates that most people in a community offer only a few ideas if any at all
        • General ratio – for every 100 participants, 10 will offer at least 1 idea, 1 will offer several
        • Demonstrated as Lotka’s Law
      • Implication: have a big community if you want a lot of ideas
    26. Differences
    27. “ Internal” vs “External”
      • What are the significant differences between an internal campaign or community and an external campaign or community?
        • Engagement
        • Visibility/Participation
        • Direction/Communication
        • Intellectual Property
    28. Engagement
      • Engagement
        • You can run and manage a haphazard internal community, but that won’t be tolerated by customers and prospects
        • They will want to know their ideas will be reviewed, evaluated and implemented
        • Without an active, engaged team inside your organization, the community will abandon the site, leading to negative publicity
    29. Visibility
      • Can’t be a “little” pregnant…
        • Once the community incorporates a number of prospects, partners or customers, it becomes a social networking site, subject to all of the opportunities and issues
        • It is as much about receiving ideas as it is about exchanging information with customers and partners
    30. Direction/Communication
      • Since you are working with people you don’t pay, don’t manage and don’t control, your success is based on the communication and directions you offer
    31. Intellectual Property
      • Any innovation can have IP impacts. Depending on the community, this can have consequences for your firm
        • Open suggestion – difficult to determine what is intellectual property and to defend anything discussed in “public”
        • Invitational – more control over the IP, agreements about ownership in advance
        • Trusted partnerships – already negotiated
    32. Connection to Innovation Process
    33. Connecting to the “back end”
      • Define your methods and process carefully
        • Transferring ideas from an internal ideation program or community can be difficult enough
        • Introducing ideas from the external world is very challenging
      • What is your process for doing this?
    34. Hypothetical Process
    35. Staffing
      • Based on your expectations and goals, you’ll need to staff the community appropriately
        • Resources to engage and interact with the community
        • Resources to rank, assess and evaluate the ideas
        • Resources to ensure effective communication
      • A vibrant external innovation community can consume three to five full time equivalents
    36. Beyond Innovation
    37. Other Benefits Listening Post Spotting Lead users Identifying Trends
    38. Wrapping Up
    39. Conclusion
      • It’s not an “either-or” it’s a “both-and”
        • You need a strong castle to develop ideas internally and ships to reach out to other for additional or different idea generation
      • It’s not the same
        • There are differences but they can be managed jointly
      • It’s not important
        • As long as you don’t mind being the “rear dog”
    40. Questions?
    41. Contact Us
      • Jeffrey Phillips
      • 919-844-5644 x789 (office)
      • [email_address]
      • www.ovoinnovation.com
      • http://innovateonpurpose.blogspot.com

    + Jeffrey PhillipsJeffrey Phillips, 3 months ago

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