User Defined Innovation

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Executive summary (peppered with a few examples of my own) of Eric Von Hippel's book Democratic Innovation

Executive summary (peppered with a few examples of my own) of Eric Von Hippel's book Democratic Innovation

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  • 1. (adapted from: Democratizing Innovation by Eric Von Hippel)
  • 2. Objective
    • How to understand unique customer needs to create breakthru products and services
    • Agenda:
      • Customers customize – fact?
      • Customers customize – why?
      • Customers customize – how to channel into innovation ?
  • 3. Many Users want custom products
    • Enterprise Software users customize (often) heavily
    • Surgical and Medical users (MRI, surgical equipment)
    • Sports
    • Designer Cars
    • Holiday offered by a tour operator
    User Needs are heterogeneous … . unlike what mass market manufacturers believe
  • 4. Lead Users customize and develop products themselves … . Often without the manufacturers
  • 5. Why do Lead Users customize?
    • Lead users have needs that foreshadow the general market
    • They customize because:
      • they have unique needs AND
      • they expect high profits
    • They customize on their own because they find it:
      • Difficult to explain to manufacturers
      • Easy and quick to do it on their own
      • Interesting to figure it out on their own
    Manufacturers develop products for many customers … . leading to missed innovation opportunities
  • 6. Innovation = Need + Solution
    • Information is difficult to transfer
      • It may be tacit (“how can we explain this ?”)
      • A lot of it is required (“you did not tell us that ”)
    Information is sticky …. Which is why the twain find it difficult to meet User has NEED Information Manufacturer has SOLUTION Information
  • 7. Toolkits for User Innovation
    • Advantage to Manufacturers:
      • Can take one user innovation to other users
      • Can offers innovation cheaper and more functional
    Help both manufacturers and users … . they iterate within their information domain Manufacturer develops basic product User develops specific application
  • 8. Examples Automobile Car Color Selector for ICI (developed by a company I founded) … and of course Web Services architecture
  • 9. Good Toolkits should…
    • Allow complete cycle of trial-and-error learning:
      • Not just pick from a menu
    • Offer a solution space
      • Depending on the constraints that manufacturer wants to impose
    • User Friendly Tools:
      • Both parties need not learn others languages
    • Offer commonly used modules for re-use
      • So that user creativity is focused
    Quality of Toolkits is key to their effectiveness
  • 10. Will Users share information?
    • Reality :
      • Lead Users often freely reveal their innovations
      • Lead Users congregate and collaborate in communities
    • Why?
      • Enhanced functionality and better quality through collaboration
      • Enhanced prestige within their community
      • A secret is not really a secret at least not for long!
    Lead Users stand to benefit from developing the innovation … .. They benefit more by sharing its details
  • 11. Making Enterprise software development fun… … users developed product ideas in Idea factory