Earlier in this series I told you about some benefits related to implementing Open Innovation, now let’s go to the challenges this represents. First important thing to consider: not all kinds of innovation can be obtained from outside of the company’s walls. According to Judy Estrin -veteran Silicon Valley executive and author of Closing the Innovation Gap: Reigniting the Spark of Creativity in a Global Economy-, some of the innovation required for designing a company’s next generation of products cannot be learnt from what customers claim, simply because they may not know what they will need in five years.
But let’s suppose that Open Collaboration(*) is suitable for a certain company, then what issues should be thought-out? A very important decision is what people to approach. Complex R&D problems like the ones DuPont may face, or delicate researches like the ones conducted in the pharmaceutical industry, demand for expert collaboration. When it comes to picking customers, a good idea can be to invite users that are active on blogs or online forums that rate the product, whether they are happy with it or not happy at all. The software provider company TechSmith chose this path, asking users what features they love and/or hate about their products, and what aspects can be improved.
Another significant point is to understand that customers participating in this kind of initiatives are not employees, and therefore managers cannot assume they will be always eager to devote their time to evaluating products. However, companies can offer a number of incentives that help attracting and retaining this outside resources; these incentives might go from a “material level” -by giving them free samples to try, or cash prizes for the winners of design contests-, to a more “emotional level” -related to the possibility of being part of a community, or even an almost-insider at a company customers love-. In cases in which there are intellectual property issues involved there are signed agreements, so the behavior of the experts is more predictable. Nevertheless, giving royalties to the developers seems to be a reasonable policy.
Finally, the participatory platforms must be designed in such a way that the companies can get the answers they want. By this I don’t mean that all feedback should be positive, but that questions should be asked in such a way that the comments are relevant for the goal to be achieved. The people who participate may really like the company or the product, but the way they express it may be very different from the language used by the employees. Involving members of the company in order to moderate the discussions or to clarify any questions can be a smart move.
Although it’s still too early to draw conclusions about whether or not these new practices will grow over time, some numbers make them seem promising. Some studies suggest that 25% of Western Europe’s Internet users now post comments and reviews about consumer products; user-generated media sites are growing in numbers of visitors and participants by 100% a year, while the increases for traditional sites is between 20% and 30%(**).
(*) Here I’m using Open Collaboration and Open Innovation as synonyms because I’ve found both expressions. If the people a company is addressing in these initiatives are only customers, another possible expression is Crowdsourcing.
(**) These numbers can be a little tricky: if you’re familiar with the curve that represents the life cycle of any product, service or technology, then you know that once the Introduction stage is over, Growth comes… these user-generated sites are probably going through this phase, and the real question that should be asked is how long it will take for them to reach Maturity (where traditional sites seem to be now). And if you’re not familiar with this lifecycle model you can go to the link below to learn more!
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