While proper research could certainly be part of the blame for the failure of some new products, I also see the realities of business pressures to launch “no matter what the research says”.

Most companies have internal objective to launch new products throughout the year. These new product launches have sales estimates of demand, which in turn feed through to company projections of future growth.

If you accept my statement to be true for a moment, then it would seem that part of the solution is to have a more flexible business plan and a corporate culture that would permit business objectives to be more fluid and allow for products not to be launched that are not ready to market in the first place.

But who is going to tell the CEO that they will miss their second half sales estimates because their new product isn’t ready to launch just yet? Do we have any takers for that assignment?

A rush to “get something out” can be driven by the calendar. In startup companies, specifically software ones, the advice is to release often. Get stuff out there, see how it performs. Y Combinator’s Paul Graham advocates this.

But does that advice work for large companies? Not just software entities, but other industries as well? It’s not as realistic. PT Boats can adjust course and channel resources much more quickly than can aircraft carriers.

Which puts a premium on “getting it right” as much as possible before release. Not fix what went wrong afterwards. One can argue that philosophically, big companies just need to be more nimble. That advice and $3.00 will get you a cup of coffee.

Big organizations would do well with a slower development cycle that…

Puts a premium on understanding customers jobs-to-be-done: Before developing anything, spend time talking with customers about what their needs, desires and pain points are. There is some of this via focus groups, but my sense is that those are (i) sporadically used; (ii) designed to elicit opinions on something already in development. People who express these jobs are potentially good candidates for any co-creation the company wishes to engage in.

Allows for small experiments: Once you’ve got a bead on what jobs customers are hiring for, try out some solutions. In many ways, this is taking a page from Steve Blank’s customer development methodology. Talk with some customers, particularly the ones who identified the job-to-be-done.

Finally, senior executives need to look at this as an essential part of increasing the odds of success for new product introductions.

We’ve launched ICON.

It has almost 200 companies signed up in less than 2 days. We’re feeling hopeful we have something people will really value. If you’ve already had a go of the tool, thank you. If not, signup is free, so please do try it.

Today, I wanted to talk about the process of getting a brand new product from idea to production. It was a cycle that’s had all the standard behaviours any company goes through when it attempt to do something new.

Are you surprised a company that does innovation for a living is really no different internally to any other company when it comes to doing innovation?

It is why doing innovation is hard. Here’s the inside story on the germination of Icon at Spigit.

Triggering The Innovation Antibodies

As I’ve written before, every genuinely new thing you suggest in an organization creates winners and losers. The losers quickly form groups to defend their territory.  There’s nothing aggressive or bad about this, it is just human behaviour.

But you have to be ready for it.

When we proposed a freemium offer internally a year ago, many people in our company were horrified.  In particular, revenue generating folk were strongly opposed. Their concern, obviously, was we’d cannibalize revenues from our enterprise idea management platform, Engage. How would they get paid on something that was free? And, they wanted to know, what would they tell their customers?

Icon, as it stands today, is pretty much in a separate space from our other products, but at the start, it wasn’t clear to everyone what our intentions were.

Here’s the problem you face: invariably, those with the most to lose are the ones who worry the most. They’re also the most vocal. Unless you’re careful, your concept gets shut down before you even start.

Vocal people with established business lines tend to have quite a bit more pull than a small group with a bit of an idea.  Furthermore, it simply isn’t reasonable to expect everyone in a company – even an innovation company – to be in an innovation-preferred segment. There are still late majority and laggard personality styles to contend with.

They’ll object to anything that deviates from the established trajectory, because these are the people you pay to make sure the established trajectory delivers. It isn’t malicious behaviour, they think they’re doing their jobs.

Actually, they are doing their jobs when they object.

Lesson 1: People will object. They’ll try to shut it down. Be ready with decent, non-confrontational arguments. Be prepared to take a longer term view, and create a momentum of agreement. Eventually, you get enough people on side your idea will become real.

The Attack Dogs Rise

As an idea gains momentum, and it looks as if it might actually start to happen, new behaviours start to assert themselves. This is especially true when resources start to get assigned to moving things forwards.

Spigit is still pretty much a startup, so our resources, especially in dev and design, are not unlimited.

But we’d decided with this product we wanted a beautiful user interface, one that people would look at and go “wow” no matter what device they were on. So that meant that we sucked up every graphic designer and UI developer in the company.

And then we wanted to make sure we had a beautiful backend, one that we could be proud to expose to the world eventually as an API. And that meant we sucked up the best engineers in the company as well.

In the meantime, other products still had their requirements too. And we’d taken many of the best the resources to do something that was gong to be “free”.

We were at the stage when people understood we were making an important play, but  couldn’t see anything except how inconvenient we were making things for everyone else.

This, too, is true of innovations in any company of any size. The pain that precedes any result is usually quite substantial, and you have to somehow show people that the stuff which will come out the end will be worth it.

We were lucky, though, that our engineering team decided to use an agile methodology for the build. It meant we had stuff to show very early.

Actually, one day, I walked past Paul’s office (our CEO) and discovered he’d been showing prospective customers our early wireframes.  Firstly, I was surprised he’d even gotten them, and then piqued that he was showing stuff that early.

But the point is, he had something to show. We were causing significant upheaval in the company but at least people could see early results. It is what saved our project from the attack dogs who wanted it shut down, or scaled back, or diluted to something that wouldn’t have been nearly as effective.

I don’t mean to be critical when I use the term “attack dog”, by the way. But as a person who studies innovation for a living, that really is the best characterisation of what happens when groups of people are threatened by something new. They form packs to defend their territory, and can be vicious when they don’t get what they (think) they need to perform their own jobs.

Again, I must emphasize that in companies with established businesses, this is what you pay these people to do.  You can’t possibly run a repeatable business without them.

On the other hand, of course, they’re the reason doing innovation so hard. Even for an innovation company.

Lesson 2: The attack dogs will rise. Your only defence is to have results early, something to show. Otherwise, it is all pain and no gain, and you will either be shut down or watered down. Be ready with great evidence of progress.

The Success Cats Come In

Eventually, you get your new thing to a point where even the most vocal objector can see there’s enough momentum that cancellation isn’t an option. At this point some of these folks even convert to the vision.

It is tempting, when everyone starts getting excited about the new thing, to relax and breathe a sigh of relief.  This is a mistake.

Two years ago, in my book “Innovation and the Future Proof Bank”, I wrote:

“Implementing innovation is a process of managing compromise… everyone will propose changes and enhancements to support their particular agenda. This results in dilution of the original idea which justified investment in the first place. Carefully select the compromises you allow so you have sufficient political capital to reject ones which have a dilutive effect on the initial proposition”.

There is a correlation between the amount of excitement your new product generates and the number of people and groups who want in on it. Success breeds success, obviously, but what you don’t want is a whole pile of new stuff introduced late.

As we got closer to the end and a launch, there were lots of suggestions made about product changes we should make and features we should add.

Now, I hasten to say, some of these were excellent.

But that is irrelevant.

Introducing things late is almost always a mistake. You have to hack your engineering and design, and invariably, the lack of thinking about implications bites you.

We had this a few times, and in the end had to make certain compromises to fit stuff in. For example, we had to limit the browsers we could support in order to free up development and QA time. The only version of IE we support right now, for example is IE9.

Most corporates don’t even have IE9 yet. So this was a significant and painful compromise. We’ll get to supporting IE8 and others, but since our target market is corporates, we hated having to do it.

Also, I think we made some pretty unreasonable demands on our wonderful development, design, and QA folk towards the end. I don’t really know how they lived through it, myself.

Perhaps if the team and I had managed compromises better, some of the scramble at the end would have been less painful than it was.

Lesson 3: Everyone wants to be a part of something that looks like it will be a success. To get their name on things, they’ll try to change your product in some way. Carefully manage this, and don’t accept stuff that will muck up the overall product if you can avoid it.

Out the Door

So we launched 2 days ago, and adoption is looking good.

People are feeding back positive things.

And we’re about to start the whole next development cycle, which will have icon do some more exciting things in June.

I’ll post back then with stories of how the second dev cycle went, and what we did differently this time around.

Idea management has gotten quite boring lately. Everyone, it seems has a tool. And they all do the same old thing.

Put your idea in. Vote a few times..

Be irritated when no one cares.

Repeat until you shut down idea management in disgust.

I’ve been dark for the last month or so on this blog, because I’ve been involved in imagining and building a fresh look at the problem.

Our realization was social interactions online are all very good, but they’re only useful for individual communications and one to many broadcasts.

If you’re trying to find the golden nugget, that gem of an idea that changes everything, you need a different unit of aggregation than individuals. You need to get quick, accurate consensus across groups.

So we built Icon, our new platform for collective intelligence. It’s a game with serious intentions.

Firstly, it’s a social network, but one with a difference. The basic unit of work is your expressed preference for one of you’re colleagues ideas over another. Instead of voting, you say “I’d rather have this, than that”.

Secondly, it is a game. Internally at Spigit, we’ve been using it for a month, and people get addicted quite quickly. Anyone can ask a question on anything, and expect to get quick results. Today, for example, someone started a whole thing on the best Super Power to have, and why?

At Spigit, the crowd is presently saying:

1. The power to turn socially awkward situations into song and dance routines from Chicago
2. The power to steal the super powers of others
3. The ability to f**t glitter (this was suggested by one of our brilliant designers).

This from a field of lots of suggestions, most more serious than No. 3

Now, you’d think this was all spammy and time wasting, but actually, it is really good fun. Sometimes you need fun when you’re dealing with other questions which are presently running, such as

“What are the top product enhancements or bug fixes to enhance the customer experience” – Spigit Says “Enhance Idea Merge and Combine”

or

“Delocalizing Spigit- How best to work across timezones”, for which Spigit Says “Support a Shift System”.

What we’re doing with Icon is implementing “[Your Company] Says” for any question that anyone inside asks.

That’s an important new capability, and one that I think lots of people would like to have.

I invite you all to try Icon, and I’d love to hear your feedback. Its free.

Today marks the official launch of Icon by Spigit. What is Icon?

The platform for fast, easy and powerful engagement with your crowd to gain insight.

Icon will deliver a completely different experience than anything you’ve seen. It employs a new voting mechanism, and game mechanics are part of its DNA. It’s pleasingly lightweight, and good for more than just ideas. Icon is built for employees to solve problems and get answers.

Oh, did I mention it’s free?

While using is believing (click here to get your company’s Icon), let’s highlight some of what makes Icon tick.

Simplicity is the new Powerful

Time was, the measure of software’s power was its number of features. The more the better, because that meant the application could do so much . Fast forward to the consumerization of enterprise software. What have we learned? That software that relies on social principles works better with a tight, focused feature set and a compelling user experience.

Icon is built to do these three things:

• Get solution-seeking challenges up and running fast
• Lightweight submission of responses
• Dynamic, real-time ranking of top submissions

The UI and the UX both reflect this focus. For example, look at the idea submission form. Overall number of fields is kept to a minimum, and only the idea title is required.

Notice also that insight requires an economy of expression. Character limits on the title and description necessitate focus on the core parts of the idea. The description is a text-only field, without the ornaments of HTML formatting.

For community members, this makes an idea quite consumable and ready for the new voting mechanism.

Pairwise comparisons elicit value judgments

Up-down votes and rating systems have become a pervasive part of our web experience. With Icon, participants are introduced to a new form of voting: pairwise comparison.

For each challenge, you are presented with two of the submitted ideas. Here’s an example:

You are asked to select the idea that you would rank higher, by clicking either ‘This’ or ‘That’. In keeping with the concepts of cognitive diversity, Icon is not prescriptive as to the basis of making a decision. Rather, people are free to use their own criteria for determining which idea ranks higher. The value here is accessing different perspectives, heuristics, knowledge and experiences of the crowd.

When done by a large number of individuals, these value decisions generate a ranking system for ideas. Icon also ensures that each idea gets multiple pairwise comparisons from the crowd, providing comprehensive coverage of all submitted ideas.

As comparisons are made, the ranking of ideas updates dynamically, in real-time. You can literally see rankings change as the crowd makes judgments about the different ideas. These dynamically changing rankings are part of the game mechanics that draw people to Icon.

Gamification spurs engagement and gets results

More and more, gamification is showing up in our online experiences, both on consumer sites and in enterprise software. Dachis Group’s Dion Hinchcliffe recently observed:

Although gamification can be successful without crowdsourcing, tapping into a diverse audience increases innovation, scalability, elasticity, and capacity of the gamified business process.

Key here, of course, is that gamification must be intelligently applied. Icon delivers game mechanics in a way that keeps participants coming back. Several of these gamification elements are described below.

Idea pairwise comparisons : Aside from being a mechanism for capturing value judgments, the pairwise comparison certainly brings a fun element to the voting process. You sit in judgment on two ideas, and make a call. And the dynamic updates to rankings as voting occurs bring to mind the real-time feedback one receives from a video game.

Front and center activity leaderboard : Integral to the experience is the Leaderboard. Each challenge, and the overall Icon site, shows the individuals who have contributed the most, via ideas, comments or votes. Points update in real-time, giving each person instant feedback on how much they are contributing to help answer different challenges.

Spend points to set up challenges : In Icon, it costs points to set up a new challenge. This has the effect of putting a value on a challenge, helping ensure the quality of a question asked of the community. Quora recently instituted a similar game mechanic. In addition, each challenge carries with it a specified payout. Top three ideas earn a level of points, as do the top three participants. The larger the “booty” associated to a challenge, the more incentive others have to participate.

Send gifts to other people : If someone does something that you find valuable or helpful, you can recognize that with a gift. Beside each person is a gift icon, which when clicked provides that person with an additional 10 points.

Not just for ideas

Here’s a quick way to distinguish invention vs. innovation:

Invention creates. Innovation changes.

In both cases, ideas are the core fuel. But Icon also works well with much smaller, less ambitious challenges that aren’t part of a company’s innovation efforts. For instance, Spigit CEO Paul Pluschkell posted a challenge asking in what location we should hold our customer summit. Not ideas in the innovation sense, but responses to a business question for sure.

While he could have done a survey, the problem there is that all the choices would need to be preset. This challenge allowed employees to come up with suggestions, and let them decide which ones were the best.

Think of Icon as a crowdsourced way to get answers.

Integrated with your existing Yammer network

Signing in to Icon is easy with your Yammer account. Both in initial registration and for all subsequent log-ins, you can simply click the Yammer icon. You confirm with Yammer that you give permission to Icon to use your Yammer credentials, and you’re on your way.

Dead simple.

Once you’ve established your Yammer credentials, several Icon activities are published into Yammer. In the main message feed, new challenges are posted. In the activity ticker, new submitted ideas and comments are published. This integration into your Yammer network expands the potential input that business challenges receive.

All of this is available for free. To get started, simply sign up for your company’s account here. Drop us a line, and let us know what you think.

• Transistors
• Silicon-based semiconductors
• Mobile communication
• Lasers
• Solar cells
• UNIX operating system
• Information theory (link)

They all have origins in the amazing Idea Factory, AT&T’s Bell Labs. I’ve had a chance to learn about Bell Labs via Jon Gertner’s new book, The Idea Factory: Bell Labs and the Great Age of American Innovation. (Disclosure: I was given a free copy of the book for review by TLC Book Tours.)

I don’t know about you, but really, I had no sense of the impact Bell Labs had on our current society. Gertner writes a compelling narrative intermingling the distinctive personalities of the innovators with layman points of view about the concepts they developed. In doing so, he brings alive an incredible institution that was accessible only as old black-and-white photos of men wearing ties around lab equipment.

For the history alone, read this book. You will gain knowledge about how the products that define life today came into being back in the 1940′s, 50′s and 60′s. I say that as someone who really wasn’t “in” to learning about these things. Gertner, a writer for Wired and the New York Times, invites you into the world of these fascinating, brilliant people and the challenges they overcame in developing some damn amazing technological achievements.

Those stories really carry the book. But just as interesting for innovation geeks are the lessons imparted from their hands-on work. There are several principles that created the conditions for innovation. Sure, the steady cash flow from the phone service monopoly AT&T held for several decades was a vital element. But that alone was not sufficient to drive innovation. How many companies with a strong, stable cash flow have frittered away that advantage?

Looking beyond the obvious advantage, several elements are seen which determined the Labs’ success. They are described in detail below.

#1: Inhabit a problem-rich environment

In an interview with a Bell Labs engineer, Gertner got this wonderful observation. Bell Labs inhabited “a problem-rich environment”.

“A problem-rich environment.” Yes.

Bell Labs’ problems were the build-out of the nation’s communications infrastructure. How do you maintain signal fidelity over long distances? How will people communicate the number they want? How can vacuum tube reliability be improved for signal transmission? How to maximize spectrum for mobile communications?

I really like this observation, because it sounds obvious, but really isn’t. Apply efforts to solving problems related to the market you serve. It’s something a company like 3M has successfully done for decades.

Where you see companies get this wrong is they stray from the philosophy of solving customer needs, becoming internally focused in their “problems”. For instance, what problem did New Coke solve for customers? And really, what problems is Google+ solving for people that aren’t handled by Facebook and Twitter?

A problem of, “our company needs to increase revenues, market share, profits, etc.” isn’t one that customers give a damn about. Your problem-rich environment should focus on the jobs-to-be-done of customers.

A corollary to inhabiting a problem-rich environment: focus innovation on solving identified problems. This vignette about John Pierce, a leader in Bell Labs, resonates with me:

Pierce was given free rein to pursue any ideas he might have. He considered the experience equivalent to being cast adrift without a compass. “Too much freedom is horrible.”

#2: Cognitive diversity gets breakthroughs

Bell Labs’ first president, Frank Jewett, saw the value of the labs in this way:

Modern industrial research “is likewise an instrument which can bring to bear an aggregate of creative force on any particular problem which is infinitely greater than any force which can be conceived of as residing in the intellectual capacity of an individual.”

The labs were deliberately stocked with scientists from different disciplines. The intention was to bring together people with different persepctives and knowledges to innovate on the problems they wanted solved.

For example, in developing the solid state transistor, Labs researchers were stumped to break through something called the “surface states barrier”. Physicist Walter Brattain worked with electrochemist Robert Gibney to discover a way to do so. Two separate fields working together to solve a critical issue in the development of semiconductors.

The value of cognitive diversity was systematically modeled by professor Scott Page. Bell Labs shows its value in practice.

#3: Expertise and HiPPOs can derail innovation

Ever seen some of these famously wrong predictions?

Ken Olson, President & Founder, Digital Equipment Corp. (1977): “There is no reason anyone would want a computer in their home.”

 Albert Einstein (1932): “There is not the slightest indication that nuclear energy will ever be obtainable. It would mean that the atom would have to be shattered at will.”

Western Union internal memo (1876): “This ‘telephone’ has too many shortcomings to be seriously considered as a means of communication.”

Now, before we get too smug here…haven’t you personally been off on predictions before? I know I have. The point here is not to assume fundamental deficiencies of character and intellect. Rather, to point out that they will occur.

What makes wrong predictions more harmful is the position of the person who makes them. Experts are granted greater license to determine the feasibility and value of an idea. HiPPOs (high paid person’s opinion) are granted similar vaunted positions. In both cases, their positions when they get it wrong can undermione innovation.

Bell Labs was not immune. Two examples demonstrate this. One did not derail innovation, one did.

Mobile phones

In the late 1950s, Bell Labs engineers considered the idea that mobile phones would one day be small and portable to be utopian. Most considered mobile phones as necessarily bulky and limited to cars, due to the power required to transmit signals from the phone to a nearby antenna.

In this case, the engineers’ expertise on wireless communications was proved wrong. And AT&T became an active participant in the mobile market.

Semiconductors

In the late 1950s, Bell Labs faced a fork in the road for developing transistors. The Labs had pioneered the development of the transistor. Over time, the need for ever smaller transistors was seen as a critical element to their commercialization. Bell Labs vice president of device development, Jack Morton, had a specific view on how transistor miniaturization should happen. He believed a reduction in components was the one right way. Even as development of his preferred methodology was proving technically difficult, he was unwilling to hear alternative ideas for addressing the need.

Meanwhile, engineers at Texas Instruments and Fairchild Semiconductor, simultaneously and independently, developed a different methodology for miniaturization, one that involved constructing all components within one piece of silicon. Their approach was superior, and both companies went on to success in semiconductors.

Bell Labs, pioneers in transistors, lost its technological lead and did not become a major player in the semiconductor industry.

With mobile phones, the experts could not see how sufficient power could be generated. Fortunately, their view did not derail AT&T’s progress in the mobile market. In the case of semiconductors, Bell Labs engineers were aware of the integrated circuit concept, before Texas Instruments and Fairchild introduced it. But the HiPPO, Jack Morton, held the view that such an approach could never be reliable. HiPPO killed innovation.

#4: Experiment and learn when it comes to new ideas

When you think you’ve got a big, disruptive idea, what’s the best way to  handle it? Go big or go home? Sure, if you’re the type to put the whole bundle on ’19′ at the roulette table.

Otherwise, take a cue from how Bell Labs handled the development of the first communications satellite. Sputnik had been launched a few years earlier, and the satellite race was on. The basics of what a satellite had to do? Take a signal from Location A and relay it Location B. Turns out, there were a couple models for how to do this: ‘passive’ and ‘active’ satellites.

Passive satellites could do one thing. Intercept a signal from Location A and reflect down to Location B. In so doing, they scattered the signal into millions of little bits, requiring high-powered receptors on the ground. Active satellites were much more equipped. They could take a signal, amplify it and direct it to different places it had to get to. This focused approach required much lower-powered receiving apparatus on the ground, a clear advantage.

But Bell Labs was just learning the dynamics of satellite technology. While active satellites were the obvious future for top business and military value, they were much more complicated to develop. Rather than try to do of that at the outset, John Pierce directed his team to start with the passive satellite. To start with an experiment. He explained his thinking:

“There’s a difference, you see, in thinking idly about something, and in setting out to do something. You begin to see what the problems are when you set out to do things, and that’s why we though [passive] would be a good idea.”

#5: Innovation can sow the seeds of one’s own destruction

Two observations by the author, John Gertner show that even the good fortune of innovation can open a company up for problems. First:

“In any company’s greatest achievements one might, with clarity of hindsight, locate the beginnings of its own demise.”

One sees this in the demise of formerly great companies who “make it”, then fail to move beyond what got them there (something noted in a previous post, It’s the Jobs-to-Be-Done, Stupid!). In a recent column, the New York Times Nick Bilton related this story:

“In a 2008 talk at the Yale School of Management, Gary T. DiCamillo, a former chief executive at Polaroid, said one reason that the company went out of business was that the revenue it was reaping from film sales acted like a blockade to any experimentation with new business models.”

Gertner’s second observation was this, with regard to Bell Labs’ various innovations that were freely taken up by others:

“All the innovations returned, ferociously, in the form of competition.”

This is generally going to be true. Even patented innovations will find substitute methodologies emerging to compete. Which fits a common meme, that ideas are worthless, execution is everything. It’s also seen in the dynamic of the first-to-market firm losing the market by subsequent entrants. After the innovation, relentless execution is the key to winning the market.

Excellent History and Innovation Insight

Wrapping this up, I recommend The Idea Factory. It delivers an excellent history of an institution, and its quirky personalities, that literally has defined our digital age. No, they didn’t invent the Internet. But all the pieces that have led to our ability to utilize the Internet can be traced to Bell Labs. Innovation students will also enjoy the processes and approaches taken to achieve all that Bell Labs does. Jon Gertner’s book is a good read.

March 13, 2012, Doug Collins:

Opening the Practice of Collaborative Innovation to the End User

In a past article I provided a framework for thinking about the practice of collaborative innovation. I recommended that people new to the practice start their journey by pursuing the internally focused, enquiry-led form (figure 1).

Figure 1: forms and areas of focus for the practice of collaborative innovation

Learning how to craft the critical question (the enquiry), form the community, and develop commitment between sponsor and member takes time. New practitioners benefit by honing their skills with an internal, presumably more forgiving audience ahead of wading into the deeper waters of externally focused innovation with clients. The complexities that define the supplier-vendor relationship do not intrude, internally. The administrative and promotional overhead stays more manageable, internally.

In time, however, you will want to explore ways to take your practice outside the organization and pursue the external focus. Co-creation through collaborative innovation remains the most profound, authentic way of engaging with clients and their end users. Studies by Von Hippel and others find that 10-40% of end users pro-actively innovate on (e.g., customize) commercially available products. Engaging this group in collaborative innovation yields valuable ideas on what it means to deliver value.

Looking ahead, I expect that organizations that have grown frustrated with social media as a means to grow closer to their clients and users will, over the next couple years, integrate the enquiry-led form of collaborative innovation. The days of counting likes and page views as a measure of engagement have come to a close. We see, by way of example, firms such as Cisco and Mattel’s Fisher-Price subsidiary pursuing this path with their recently launched, externally facing BIG Awards and My FP Ideas  challenges, respectively.

Name Your Goal

Campaign teams that dive into the mechanics of launching an externally facing challenge without first reaching a shared understanding of its purpose risk sowing ambiguity amongst themselves and their end-user participants later. Why are we here? Where are we going?

The campaign team makes two critical decisions on this front.

• What question, were we to pursue it fully with clients and end users, would lead to breakthroughs in our level of engagement with them and the ways in which we deliver value?
• Do we solicit ideas that we want to pursue internally or do we solicit ideas that we would help the contributor pursue by funding them or by providing other means of support?

On the first point, I advise campaign teams to go for the jugular: ask the one question most central to the business or the brand that resonates with the largest swath of the user community. We see Fisher-Price take this approach, for example: they clearly solicit ideas about baby toys, which ties closely to their brand and their users.

On the second point, the campaign team must decide whether the innovation campaign serves as a source of compelling ideas that they choose to develop or that they support the contributor in developing. Cisco, for example, chose the latter path. They use the BIG Awards to encourage entrepreneurialism at large in the United Kingdom (figure 2).

Figure 2: goal-setting on the front end of an externally focused innovation campaign

Name Your Community

Organizations express surprise at the extent to which users form formal and informal networks around their offer or brand. They form chapters. Users compare notes at trade fairs. They create email list services. They start LinkedIn groups. The digital age gives the networks visibility, boosting their participation. The networks often operate outside the influence of the organization itself.

As a first step towards identifying their community, the people designing the external innovation campaign will want to take time to explore and map the networks their users have created. Some organizations may have done so by way of soliciting participation in customer and executive advisory boards, for example.

The lead users that you identify through the mapping exercise serve as candidates for a mini-advisory board for the campaign in question—perhaps for a series of campaigns (figure 3).

Figure 3: finding user candidates to offer guidance on the external campaign

They provide invaluable end user perspective on the nature of the question and the associated commitment between the organization and the innovation community. They serve as peer-level advocates for the campaign with their fellow users. Properly trained, they can serve as moderators during the campaigns.

I admit my surprise by how often organizations will go far down the path of developing an external innovation campaign without having involved a leading subset of the very group they hope will participate. At times I sense concern in terms of who owns the relationship with the user. This concern can cause the campaign team to defer engaging with the organization’s lead users during planning: a rather large, missed opportunity.

Name Your Commitment

Campaign teams must tend to two items on the commitment front as they plan their external innovation challenge: the nature of the contribution they seek and the need for promotional support by a capable marketer.

Relative to the nature of the contribution, campaign teams can request fully formed ideas in response to the question. They can also request fully formed business plans. I see the latter request in cases where the organization proposes to fund the contributor’s idea to concept by way of offering a prize.

All entrepreneurs may be lead users; not all lead users are entrepreneurs.

Either approach can work. However, I find that campaign teams overestimate the number of people who have developed a business plan—or who can create one in short order—which they can in turn submit to the challenge. Whereas Von Hippel finds that 10-40% of the people in user communities engage in innovation (e.g., customizing the organization’s offer), a fraction behave as entrepreneurs. All entrepreneurs may be lead users; not all lead users are entrepreneurs.

To this end, I encourage campaign teams to consider asking the users to commit to contributing a fully formed idea to start. The commitment that the organization makes in turn in this case is to explore the potential that the idea represents. Does the idea explore a problem worth solving? Does the idea offer relative advantage over the status quo?

Co-discovery and co-creation with the organization and the peer community of users can serve as the most compelling prize to the contributor. Digital age trends suggest that organizations that master this form of engagement with their users, while acknowledging the economic value it delivers to all parties, have the greatest chance of remaining relevant and viable.

On the subject of promotional support, I recommend that the campaign team secure the full-time services of on experienced marketer for the length of the challenge, from planning to resolution. This individual articulates the goals for co-creation, identifies the disparate places where users gather so that they can receive this information, and engages them in dialogue throughout the campaign.

Organizations who take a “build it and they will come” approach underestimate the amount of work needed to solicit contributions from the target population of end users. The external form of collaborative innovation requires a lot more promotion than the internal equivalent. The former does not benefit from the natural incentives to participate and the grapevines of information that aid the latter.

Parting Thoughts

Depending on their backgrounds, campaign team members may have limited experience engaging their organization’s clients and users, directly. To this end and by way of a parting thought, I encourage people who embark on the external form of the practice to buy a copy of Eric Von Hippel’s Democratizing Innovation. Von Hippel describes the potential and the rationale for customer co-creation in rich, readable detail. He offers useful perspective that can deepen your engagement with your own users—first with your advisory board and then with the larger population of lead users.

By Doug Collins

About the Author:

Doug Collins serves as an innovation architect. He has served in a variety of roles in helping organizations navigate the fuzzy front end of innovation by creating forums, venues, and approaches where the group can convene to explore the critical question. He today works at Spigit, Inc., where he consults with Fortune 1000 clients on realizing their vision for achieving leadership in innovation by applying social media and ideation markets in blended virtual and in-person communities. Previously, Doug formed and led a variety of front end initiatives, including executive advisory programs for industry influencers, early adopter programs for lead users, corporate strategic planning, and structured explorations of new market and product opportunities. Before joining Spigit, Doug worked at Harris Corporation and at Structural Dynamics Research Corporation which is now part of Siemens Corporation.

In a recent edition of Product Management Talk radio, I had the opportunity to speak on the topic, Expanding the Innovation Pie, along with Prabhakar Gopalan,corporate strategist at Dell. The show lasted an hour, and will be available as a podcast.

In preparation for the show, host Cindy Solomonasked me to answer ten questions about innovation management. Those questions, and my answers, are included below.

Q1. What is the “customer job” (Clay Christensen sense) that needs to be filled by innovation management software?

When I seek innovations for organic growth, streamlining operations and customer engagement, I want to leverage the full cognitive diversity of my organization.

Note, for information on customer jobs, see here: http://www.therewiredgroup.com/jobs-to-be-done/”

Q2. Which employees are “right” for participating in the innovation process?

Those who can think.

Really, there is no stereotypical right employee. We™ve seen innovation communities involving highly educated professionals, and communities with in-store retail staff. Both get results.

Q3. How do you find high potential ideas from high volumes of them?

Three keys:

1. Ask the right question of the community at the outset
2. Scale the effort to find high potential ideas with the help of the crowd
3. Employ experts to find high potential ideas in their domain

This graphic from a previous post illustrates the point:

Q4. What are some models for engaging employees in a process that falls outside their “day jobs”?

Multiple ways:

1. Intrinsic motivation: This idea will help me do my job.
2. Burnish credentials: Success in the innovation program reflects well on the employee.
3. Part of their annual review: I recently came across a company that makes participation in the innovation program part of the annual bonus structure.
4. Prizes for participation and top ideas: Prizes can vary from smaller scale (e.j. Amazon gift cards) to career-altering (e.g. internal VC fund for your idea).
5. Game mechanics: Some employees really get into the game mechanics. A particular favorite is the Spigit system™s reputation score. It™s based on the feedback your submissions receive, and can be a source of friendly competition.

Q5. Isn’t this a popularity contest for ideas, and what company would operate that way?

Popularity, as in, an idea struck a nerve with front line employees and management is going to ignore it?

On the crowdsourcing front, think in terms of three insights being sourced. Ideasrepresent a pain point, or an opportunity someone has spotted. Commentsare the refinements to an idea, as well as the supporting context and clarifying questions. Votesare the judgment of individuals.

Crowdsourcing taps the cognitive diversity of your employees to identify high potential concepts sourced beyond the usual suspects.

Q6. What does it mean to “evaluate” an idea?

At the front end, the crowd is great for sourcing and identifying high potential ideas. But that doesn’t necessarily mean they automatically become projects. As Don Norman wrote:

Products enter into a complex eco-system, both within and outside of the company. Successful products have to navigate a complex path. The idea and initial design is only one piece of the story.

Part of the winnowing process for ideas is to have experts from different realms look at them, after the crowd has. Most ideas will require the scarce resources of an organization, and the evaluation phase is part of that allocation process. Evaluation includes rating the idea on different criteria, approvals and structured questionnaires.

Organizations need a way to move ideas forward after those with the most potential as identified. Otherwise, innovation programs risk falling off a cliff.

Evaluation also serves another sneaky purpose. It creates buy-in from those entrusted to do the evaluation.

Q7. How to say ‘no’ to an idea, and not discourage future participation?

Provide two elements in the feedback: (i) What is potentially interesting in the idea; (ii) Why the idea cannot be accepted. For employees, this feedback is valuable to plug into what makes innovation tick inside the organization.

An important element of participation is not to overly focus on generating ideas. Yeah, that sounds funny. But in the Spigit system, quality commenting is highly valued. Systematically, comments are part your reputation score, and virtual currency can be awarded for comments.

Q8. What are some best practices for running an employee innovation program?

Focus: Focus efforts on a particular challenge. Challenges are terrific for eliciting tucked away ideas people have had.

Marketing: The best campaigns are marketed to the internal organization. It raises awareness and creates an event feel. Efforts can include newsletters, special emails, posters around the building, videos, branding, etc.

Clearly defined outcomes: Before the innovation campaign starts, know how it™s going to end. Participants should have a clear understanding of selection bases and what happens with selected ideas.

Q9. What about expanding beyond employees, and bringing customers directly into the innovation process?

Incredibly valuable to get customers™ perspectives. After all, they (i) know their needs better than you do; and (ii) are a source of potentially valuable ideas.

The important thing here is to be ready to handle the ideas from customers. Before you ever set up an innovation platform for customers, you should think through these items:

1. What sort of ideas you are seeking
2. How to engage the community
3. How ideas will be evaluated internally
4. How to manage ideas that (i) are accepted; (ii) are not accepted
5. Who will own ideas that are accepted

Q10. Where does a crowdsourced innovation management platform fit within the enterprise software ecosystem?

Innovation management is carving out a new category of enterprise software. It™s predecessors are the suggestion box and email account to which ideas are sent. It™s part of the broader social movement sweeping through organizations, but also includes elements of evaluation and workflow. The back end of an innovation management system is tied to project management and portfolio management.

What’s the reason so many great ideas turn out to be terrible ones once they’re out the door?

Over time and many years, I’ve learned there are only a few reasons:

“I did that”

You know these people: they’re great at self promotion and talking loudly, but very poor at doing much else. They take meetings and create relationships, but you can’t pin them down to much actual achievement.

They never get fired though, and here is the reason: they’re very good at introducing small, often insignificant, changes; changes which let them claim they’ve had a material impact on whatever it is.

For an innovator, the key discipline is working out which small changes make no difference (and hence let you keep such individuals on side) and which you must fight against to preserve the integrity of your initial concept.

The clever innovator knows how to pick the battles which matter.

“That’s Mine”

Watch out for empires – those non-collaborative silos that are more loyal to themselves than the organizations they’re supposed to serve.

Empires are usually fiercely protected by whomever owns them, because, more often than not, they’re defined not by their own capabilities, but the empire itself.

Into such a mix, inject something brilliant which, if implemented, will force the empire to move, however insignificant such a move might be.

The reaction is predictable: the owner of the empire changes the idea in ways which allows them to ensure it is logically incorporated into the empire rather than isolated from it.

A lone guy with an idea is usually not in any position to fight an empire, so the clever innovator knows how to hide things from empires until it is too late to change them.

“That’s Bad”

Any new idea polarizes everyone into two camps: those who will benefit and those who will lose.

The losers will do everything they can to change the idea so they’ll lose less. They’ll likely do this by painting the idea as something that is bad.

What does that mean?

It means the thing that made the idea brilliant in the first place is going to get changed. There’s nothing malicious about this: everyone tries to protect their positions when threatened.

But for an innovator, there is really only one defence: you have to motivate those who will win to stand up on your behalf.

Rule of thumb: you need a vocal winner for every loser you can identify, and then a few more on top to account for the political foes you have that are clever enough not to show themselves up front.

“That’s Too New”

People have preferences for adopting new things. In most organizations, the preference for newness is pretty normally distributed, which means approximately half the organization will be open to new ideas, and half won’t.

The half which isn’t open, of course, will try to introduce compromises which will make your idea less new, more like what already exists. They’ll try to water down your idea in (what they say) are the best interests of everyone.

Clever innovators realize they can’t convince people who don’t like new things to like their idea, no matter how brilliant it is. What they can do, though, is make sure their ideas are introduced in such a way that the amount of change is gradual – gradual enough not to threaten those who hate change.

Have you had any experiences of your idea turning into nothing because of the compromises you’ve had to deal with?

These days, my job at Spigit has me spending 50% of my time in London, and the rest in California at our head offices in the East Bay area. This is very interesting, because it really illuminates the difference between startup world in both places.

Firstly, the obvious: London may be a hot place to start something in Europe, but it lacks the scale of the community in the Valley.

But the real differences are all about attitudes to the way things are done.

The UK is a much, much less business friendly environment than the US. The amount of red tape involved in doing anything is absurd, and you don’t realize it till you have seen the two compared.

Let me give you an example. Here at Spigit, we have our employees provide themselves the mobile phone they want to use, and expense the costs back to us. It sounds sensible, right?

In the US, this is all fair and good, but in the UK, we have to report that as a benefit in kind to the tax office. Then, what happens is the employees all get these coding notices from the tax office saying they owe additional tax because they had a personally owned phone paid for by their employer. Most of the time they only use the phone for business calls, but that, apparently, isn’t the important test of taxability.

Our CFO, based here in the US, made a very sensible suggestion: just pay their tax bill. But no, we can’t do that either. The payment of the tax bill, apparently, would be another taxable benefit.

So, instead, we have to work out a way of taking over all their phones, which are all with different operators, just so our employees won’t be out of pocket when they do our business.

Stuff like that happens all the time. I was on the phone to some unhelpful people in the UK’s tax office the other day and made this point, and discovered, somewhat to my horror, that they hadn’t yet discovered Britain no longer had an Empire.

I’m also not the first person who’ll make this observation: there is a stigma attached to being in a startup that doesn’t work in Europe, whilst trying and failing in the Valley is celebrated.

In London in particular, this is a big issue. The idea that you’d leave a relatively senior job in a big company and go to a startup and not succeed is something of a career limiting move.

It says, if you ever wanted to go back, that you can’t run projects, you can’t manage budgets, you know nothing about marketing, and have poor networking and people skills.

To get that kind of taint in a large European organization, you’d have to screw up repeatedly over the course of years. But Europeans, and the UK in particular, don’t celebrate failure as a learning exercise: it is just failure plain and simple. And as a leader, you get associated with it personally.

Here is the real challenge of the startup scene in London: it is an all-or-nothing bet. You are either completely off the career track in large organizations and doing startups, or don’t go there in the first place.

I think this might be more true for people who are at my stage in their career than those who are coming into this earlier on. It encourages major risk aversion, which, lets face it, is the number one inhibitor of innovation.

I do have this piece of advice though: startups are exciting, and they’re exhausting, but they put zest back into your work life. I used to get really annoyed with people who carried on in large companies about work/life balance, and I have come to realize something: it is only people who don’t like their jobs that rant on about it. Everyone else finds a way to make it work, because they want it to work.

The whole question of work/life balance is one that comes up only when there is a huge disparity between the amount of joy you get in what you do for money and what you do for life.

A startup, in my experience so far, has the chance to bring the two closer together than anything else I’ve tried so far.

I can’t, however, say, that the comparison between the Valley and London is all bad, though.

Europe, and London in particular, has phenomenal talent, and lots of it is available now that being a banker is so much less an attractive career choice.

The thing in the Valley is the best people are all in huge demand, and you have to be either exceptionally hot or exceptionally rich to get them.

In Europe, there aren’t so many great places for the talent to go. It is sad, but true. So, when you want XYZ skill, you can usually get it, and you can usually get it for a substantial discount on the rates you’d have to pay in the Valley. That’s wonderful for companies like ours who have operations in both places, of course. And it will continue to be so, I think, until the rest of the Valley works out what a phenomenal place for talent Europe is.

I suppose the interesting question is whether my experiences are typical or not.  So let me end this post by asking the question: if you work in both places, which is better? Or, like us, do you prefer to have the best of both worlds?

But don’t confuse that with understanding what your customers need.

Just because you’re on top of what you’re customers need from your current product, doesn’t mean you’re on top of market changes. Two titans of the television industry remind us of that. They have, in recent weeks, been dismissive of a rumored Apple HDTV:

Sharp isn’t paying much heed to rumors that Apple is developing an HDTV. Nor does it have much reason to, says Kozo Takahashi, head of the company’s operations in North and South America.

All Things D

“TVs are ultimately about picture quality. Ultimately. How smart they are…great, but let’s face it that’s a secondary consideration.” – Samsung AV product manager

TechCrunch

And there you have it. Apple HDTV? Whatever.

Of course, one might be reminded of the comment by Palm’s CEO before the Apple iPhone was introduced: “PC guys are not going to just figure [phones] out. They’re not going to just walk in.” Ouch!

What we’re seeing is incumbents falling back on the thing that got them to their position: features. This is feature-led innovation. It’s got its place in the market, but relying only on it puts companies at risk for missing either (i) critical market shifts; or (ii) emerging needs that will drive organic growth.

Divergence between Product Features and Jobs-to-Be-Done

In the graphic below, a typical scenario for feature-led innovation is depicted. What happens is that over time, companies lose touch with where the market moves, with customers’ changing jobs-to-be-done.

When a company “makes it” in the market, it has the features that meet what customers are trying to get done. On the graph above, that’s set as “Time 0”, where features match Job 1. Given this is the ticket to success, a company will of course continue to develop these features. And the people who were looking for Job 1 fulfilled will follow along as the new features are rolled out.

Somewhere along the line, a new job-to-be-done emerges. Call it Job 2. New jobs enter the market all the time, via what Re-Wired Group’s Bob Moesta calls the “push” force. After Job 2, Job 3 emerges. And on and on.

But many companies are never aware of this. There are too many customers. Product is selling. You know your company’s product, and you’ve gotten lots of feedback for improvements. Systems are in place to reward and nudge you further along the path that fulfills Job 1. When they do solicit feedback from customers, it’s all Net Promoter Scores, focus groups for new features, surveys, customer service ticket analysis. Believe me, I really can appreciate how companies get lulled into this cycle of feature-led innovation. Professor Freek Vermeulen of the London Business School calls this the innovation “success trap”.

Meanwhile, customers cast about for ways of fulfilling their new jobs-to-be-done. They improvise. They settle. They experiment. They’re open to new entrants that meet their emerging jobs. And this is how it happens to companies.

Let’s look back at what the Samsung product manager said: “TVs are ultimately about picture quality. Ultimately. How smart they are…great, but let’s face it that’s a secondary consideration.”

Here are three jobs I’d personally like fulfilled that aren’t about picture quality:

The first two of those jobs have emerged based on new technologies in other arenas (recommendation engines, social networks). The third is a tried-and-true job that’s been around forever. Might there be a play to improve that via my TV?

All three of those jobs-to-be-done are divergent from the ongoing focus on picture quality espoused by the incumbent TV leaders.

Parable of Digital Cameras

The feature race of the HDTV manufacturers has a parallel in the digital camera industry. A key feature of digital cameras has been the megapixels. The higher the megapixels, the better the image quality. It has been escalating so much in recent years, Consumer Reports ran a piece wondering when the megapixel arms race would cease.

But in another case of new jobs emerging, lower end digital cameras are seeing their sales decline. Why? As the L.A. times noted in December 2011:

According to a survey by NPD Group, 27% of photos and videos taken this year were shot with smartphones — up from 17% last year.

Wait a minute. Are you telling me that with all that megapixel firepower, we’re gravitating toward phone cameras? What’s wrong with people these days?

Nothing actually. There’s always been the job-to-be-done of capturing moments. It’s just that lugging around a separate camera everywhere you go is a pain. But people want to be connected – talk, messaging, email, surfing – and will gladly carry their phone with them. Which is quite sufficient to fulfill the job of capturing moments. Megapixels be damned. Of course, the megapixels are getting better on smart phones too. Clayton Christensen must be amused by the ongoing disruptive innovation.

Sharp, Samsung…heck, all companies…are you listening? How well do you know the emerging jobs-to-be-done by your customers?