Thoughts On Strategy: Facilitating Customer Innovation Online

• Innovation is nothing more than doing something new or something you have already done in a different way.
• Customer-driven innovation is the creation of ideas for doing something new from your customers.
• This has obvious applicability to online communication, community and collaboration!
• Track what people are saying about your company, organization, products and services online. Many ideas and new perspectives can be surfaced this way alone.
• Leverage existing customer communities anywhere on the Web when they are discussing how to improve your business.
• Determine how you can best engage your employees in this online conversation that is going on all around you. The more staff you have paying attention, the better a chance for new ideas to break through to you.
• Consider facilitating the generation, discussion, and evaluation of new ideas from your customers via interactive web sites. The case study below provides an example.
• Publicly calling for ideas from your customers conveys a promise: that you will genuinely consider them, indicate which you are going to pursue, and give credit where credit is due for the successes.
• The hardest part of sourcing innovation from customers is not going to be your customers. It is going to be getting your staff and organizational culture to incorporate them. Lay the groundwork and infrastructure to adopt great ideas before you ask for them from your customers.

Case Study: : Dell and Starbucks Customer Innovation Web Sites

Both Dell and Starbucks have launched web sites that ask their customers to suggest, rate, and discuss ideas on how to improve in any aspect of their company, operations, or products and services. Suggestions range from adding an extra shot to Venti sized lattes to ideas on being a more socially responsible global citizen. Both sites use Ideas, a service of Salesforce.com.

How are these sites different from a glorified suggestion box? Both are sponsored by the CEOs of each company, making them high profile projects internally. Each has staff dedicated to monitoring the site, responding to each entry, and taking ideas into the company for exploration. These are not trivial, feel-good, marketing campaigns. They have been designed as a key element of the overall innovation process for each company.

Dell has a dedicated blog, called Ideas in Action, where they report on the progress of ideas within the company and solicit feedback from the community of customers involved in the IdeaStorm web site. This is a great example of how the company shows its commitment to listening to their customers. It was also a critical step, given how Dell’s billion-dollar brand was bloodied by bloggers in the not-too-distant past.

This leads us to the key to success for this kind of effort: it starts within the company, rather than on the Web. If staff incentives and business processes are not redesigned to value and nurture this form of customer innovation, it will fail. Worse, publishing such a site without the organization firmly behind it reneges on the implicit promise to take the customer’s contributions seriously.

High Geekery: Occam’s Razor 2.0

The simplest solution online is often the best when interacting with customers. All you need to do to illustrate this is to complete a transaction on Amazon.com and then try to do the same on the web site of your telephone service provider. It’s rather obvious which company focuses on customer value and which does not, isn’t it?

This is even more important when you are trying to facilitate customer-driven innovation.

Take, for example, Proctor & Gamble’s effort in the late 90’s to use the web to allow customers to create their own custom cosmetics via a web site tied directly to an automated factory built just for this purpose. This was a very elaborate system to allow customers to innovate their own cosmetic colors and properties. It fell flat and was shut down at a huge loss a few years later. There were simply too many options for a normal person to pick from when all they wanted was good product from a brand they trust.

Now compare this to the simplicity of the Ideas application from Salesforce.com highlighted in the case above. Ideas are easily suggested, rated, and discussed. The company publicly responds to them, and everyone moves on, with the best ideas being implemented. The cost of a bad idea in this system is very low and good ideas are surfaced without strenuous effort. All with a simple, easy-to-use interface. This is Occam’s Razor 2.0 in action.