16 July 2008

A guru on innovation takes note

My "Breakthrough Innovation" co-panelist, Patricia Seybold, has spotlighted my blog posts on HP's memristor and photonic interconnect developments.

Patty's attention is worthy of note, as she has a track record of pegging paradigm shifts in the technology world and guiding organizations to capitalize on them. Savvy strategists listen to her, and successful ones put her advice to work.

Most critical is her relentless focus on customers and her insistence on involving them early in the strategic and developmental process, central to the ecosystem of stakeholders in a commercial endeavor. As she states in her blog's definition of Outside Innovation--both her mantra and the title of one of her books:

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.

Exactly right. Too many businesspeople are happy to say, "The customer is always right" while missing the opportunity to harness customers' insights early in the strategic or design process when it can have its most profound leverage and produce the most striking competitive advantage. As she notes:

You no longer win by having the smartest engineers and scientists; you win by having the smartest customers!

...And listening to them.

A corollary to that is to seize every opportunity to advance the education--the "smartening"--of your customers. Including: facilitate their learning from each other.

The same goes for the rest of your enterprise's ecosystem. Regardless of your business, one of the most valuable take-aways from HP's purposeful ecosystem-building was illuminated in their Photonics Interconnect Forum when Jamie Beckett quoted HP Labs Director Prith Banerjee: "Not all the smart people work at HP." If so, then the ecosystem-building and customer-smartening is a way of multiplying the ones who work with them.

Call it a positive feedback mechanism for organizational IQ.


Anonymous said...

The idea of harnessing customer intelligent is very interesting however, how would a company go about doing it??
This is one of the areas where a corporate blog might help, cause it would lead to less formal communications with the consumer.
We have recently started a corporate blog Mahindrauniverse.com, we hope this would help with bringing transparency to our customers and encourage their inputs towards the companies processes.
What do you think?

Anonymous said...

I believe in the wisdom of "smart small crowds" not the masses. Therefore I prefer to recruit "lead customers"--passionate, insightful customers (or non-) who are trying to push the envelope. People who need better products, services and processes than you currently provide. We advocate "harnessing" their intelligence through co-design--having the customers lead by designing their ideal experience for achieving their ideal experiences. Then, together with YOUR subject matter experts and functional experts, these customer consultants help your people see new ways of doing things to make their lives easier..

Once you've started the ball rolling with face to face co-design, you can continue with online discussions and sharing of examples and testing.

There's also a lot you can do with an open forum. But it has to be an open forum where respect and trust are the norm!