A new study examines the role of user-created innovations in the services industry and sheds
light on the importance of observing and
involving users in the development of new
products and services.
Ever wonder where some of big and exciting creations of business come from? Sure you have, and even more likely you have said to yourself, ‘Gee, I could have come up with that.’ Well guess what, you might have and not even known it.
The working paper, “Users as Service Innovators: The Case of Bank Services” (download study here) by researchers Eric von Hippel and Pedro Oliveira helps shed light on one underappreciated source of great innovation---the customer. Their study takes a wide view of a number of banking innovations over the past thirty years and traces their source for being. Some came about through the work of the banks themselves, some were adapted from the unique creations of their customers, while others were a sort of hybrid of the first two. Some of the methodology and assumptions in the study are open to debate, and they readily admit that in some cases, determining who came up with an innovation was quite difficult, yet the conclusions they came to are supported by many other studies as well as numerous real world examples.
Below are eight lessons, guidelines, and interesting insights that we took from the study and use in our thinking for clients. We’ll share a couple today and the rest tomorrow.
- Many times end users are taking it upon themselves to create innovations that the provider of the product or service should adopt and offer to all. Most entrepreneurs and inventors were first customers of products and services that weren't meeting some need or expectation. Companies that pay attention to these innovators while they are still just customers can sometimes bring them into the development process and thus keep the new creations within the organization.
- If a service can be self-provided then you can expect user-created innovations. For example, users can't perform heart surgery on themselves (yet) so they don't have the ability to improve that process. But customers can and do transport their own groceries from the store to their homes and thus have the ability to develop clever new and useful modifications to that process.
- Lead users or early adopters tend to be ahead of trends compared to the general market and expect greater benefits from the solutions that their innovations will bring to them. Put another way, they are often heavily invested in the products and services they use and will devote a lot of time and energy making them better. Because of this, these early adopting innovators should be indentified and given resources to bring their ideas to fruition, as their innovations are more likely to be commercially viable for bringing to the mass market.
Enough brain candy for today, we’ll cover the last five tomorrow.
photo credit - http://www.flickr.com/photos/smith/ / CC BY 2.0
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