In the last article I gave the first three of eight lessons and insights I gleaned from a recent study (download here) by researchers Eric von Hippel and Pedro Oliveira titled, “Users as Service Innovators: The Case of Bank Services.” In the study they look at the role of end users in the creation of new services and how their own innovations often can be modified and implemented by companies in commercially viable ways.
Here are the remaining five things I took from the study that I believe should be top of mind for any organization looking to fuel their innovation processes:
- There are three reasons that users bother innovating on their own: a) they have the "need" information--in other words they have some unique problem that needs solving. They live with the problem and they determine that solving the problem will improve their lives or work in some way b) they have a small need compared to a company which can't justify making such an investment or is even unaware that such an innovation would be of value, and c) the user has deemed making the innovation is of low enough cost in time and money and other resources to go ahead and prototype and test their innovation. If it would cost too much or take too long, the user may decide it is in fact not worth it and just live with the product or service as is.
- User-created innovations tend to be more novel in how they go about solving their unique needs. Conversely, many company-created solutions tend to be improvements on already well-known needs (think product feature improvements vs. creating an entirely new use for a product that wasn't thought of before) The real breakthrough innovations come about from the second group, yet those of the first type can bring incremental improvements to a company’s bottom line.
- Often a provider (the company) will take a user-generated innovation and modify it before offering it themselves and while possibly improving the experience for the users, these modifications can also remove the flexibility that the user was seeking by coming up with the innovation in the first place. An example given in the study is automatic bill pay which does make it more convenient for the user, but if the customer needed to skip a payment for some reason they have to go through a number of steps, thus making it less useful than one would think at first glance.
- Creative companies should develop "user-innovation toolkits," which are carefully-crafted sets of resources that customers can access to allow them to modify, adapt, and create entirely new uses for the original products and services they were using. For example, some software companies open up their programming code to outsiders who will then be able to make changes and create new additions to the original software, thus not only resulting in a better product, but making the customers feel like a real part in the creation process and lock in their excitement and loyalty for a long time.
- Products and especially services should be thought of as being part of larger modules from which numerous opportunities for innovation exists. Forward thinking companies are those that take this idea and apply it to their product/service offerings and in the numerous interactions they have with customers, something at Westfall | Group we call experiential design. By breaking down the entire process that a user goes through, from the learning about a product type and researching various options, to the process of buying, transporting and using the product, to the adaptations that a user makes to suit their specific needs--companies can gain incredibly valuable insights. These insights in turn may someday be turned into impactful new products, services, processes, or user-experiences that will give those observant companies a leg up in the marketplace.
Inside the Group is the brainstorming and discussion world of evolution firm Westfall | Group
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