Outside Innovation

2007 Patricia Seybold Group

Outside Innovation

How to Leverage Your Customers’ Creativity

Patricia Seybold, CEO Patricia Seybold Group, Inc.

NEDMA- May 14, 2007

Page 2 2007 Patricia Seybold Group

What is “Outside Innovation?”

Customers roll up their sleeves to co-design their products and your business.



Customers attract other customers and partners to build a vital customer-centric

ecosystem around your products and services.



Customers drive the design of your business processes, products, services,

and business models.

I want to get a great deal and get my

rebate promptly, with no hassles!

Staples Easy Rebate®

© 2006 Staples, Inc.

Customers determined how to categorize products

Ethnographic research led to Easy Reorder


Lead customers

Consultants

Guides

Contributors

Promoters

Five Roles Customers want to Play


Patterns for Customer Innovation

1. Engage customers in all five roles: consultants, contributors, guides, promoters, lead customers

2. Nurture customer communities

3. Co-design with lead users/customers

4. Provide tools & streamlined support to help them reach their goals

5. Empower customers to “strut their stuff”

6. Open your products and engage customers in peer production


Mozilla is Designed by Lead Users & Contributors


Mozilla is QA’d by Users Acting as Consultants


Mozilla is Supported by Users acting as Guides


Mozilla is Promoted by Users


Karmaloop’s Lead Customers: Urban Streetwear


Karmaloop Community Finds and Reps the Products


Customers are acknowledged for posting

Customers rate each other’s contributions!

National Instruments’ Vibrant Community

50% of new products created

by customers










• Their self-image is deeply connected to the problem domain at hand

• Passionate about their outcomes and issues

• Influential in their circles

• Thoughtful and insightful

• Imaginative, visionary

• Pragmatic, realistic

Engage Lead Customers


Zopa Founders Co-Designed with Lead Users

Discovered a new Segment: Freeformers

• People who want control over their time and their careers

• People who don’t want to work full-time for one company as “slave laborers”

• Distrust banks and other financial institutions

• Have difficulty getting loans


Zopa Co-Designed a New Lending Model

• Identified Lead Users (in an un-served market)

• Conducted ethnographic research

• Ran co-design sessions

• Brainstormed possibilities

• Piloted peer-to-peer lending model

• Engaged in continuous learning


Co-Designed a Solution to Meet their Goals

I want to borrow money easily, on my terms, to meet my goals without

dealing with an impersonal institution.

I want to invest money safely, on my terms, grow my income, help others

improve their lives.


Co-Design to Meet Customers’ Outcomes

Customers’ Streamlined Scenarios

Your Company’s Streamlined Processes

Moment of Truth

Moment of Truth

Desired Outcome

s


Moments of Truth = Business Opportunities

• A real “Moment of Truth” is a showstopper

• It keeps a prospect or customer from reaching their desired outcome

• It’s when they can’t get things done “their way”

• Goal: understand customers’ contexts, outcomes and key moments of truth

• Ask them to quantify metrics around moments of truth (elapsed time, conditions of satisfaction, specific parameters)

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The Koko Fitness ExperienceDesigned with Customers

Customers’ Moments of Truth:

•30 minutes

•Don’t need to think

•Easy to use


Provide Tools to Help them Reach their Goals

Koko Fitness Smartrainer


Koko Fitness Provides Realtime Feedback


Build an Ecosystem around Customers’ Outcomes


Cu

sto

mer

-Cen

tric

Cu

ltu

reCustomer-Led

Innovation

Unified Online Experience Transformation

Customer-Prioritized Business/IT Roadmaps

Use Customer Co-Design to Achieve:


Moment of Truth

Moment of Truth

Co-Design to Meet Customers’ Outcomes

Customers’ Streamlined Scenarios

Your Company’s Streamlined Processes

Your Partners’ Streamlined Processes

Desired Outcome

s


What We Did in the Co-Design Session:• Co-design streamlined Customer Scenarios and identify customers’ moments of truth and metrics

• Build organizational consensus around customer-critical issues

• Use customers’ metrics to drive priorities!

Co-Design Customers’ Ideal Experience with Lead Customers










Provide Tools to Help Customers Reach their Goals


Application

Resources

DiagramLayout

SystemOverview

National Semiconductor’s WEBENCH Toolkit

SortableSelection

Guide

WEBENCHWEBENCHSimulationSimulation


How Customers’ Designs Spur Innovation

National Semiconductor has leveraged customers’ designs to be able to provide pre-packaged solutions for:

• Mobile phones

• Gaming controls and consoles

• Hand-held devices

• Flat panel displays

• Medical imaging

• etc…..


Provide Customization and Innovation Toolkits


Let Customers use Your Tools Anywhere!

Design your shoes on your cell

phone, and see your design on

the Billboard in Times Square


Let Customers use Your Tools Anywhere!


Support a Continuum of Customer Innovation

Lead Users Improvise

Create Customizable

Solutions

Customers Purchase

New Product

Customers Configure Solutions

Customers Hack or Extend

Solutions

Commercialize Lead Users’Innovation

Recommend Solutions

Lead Customers Improvise

Create Next GenerationProducts

CreateExtensibleSolutions

CommercializeNew Solutions

Partners Create New Solutions

Customers Create New Solutions

C O M M U N I T Y

CAPTURE PATTERNS

CAPTURE PATTERNS

CAPTURE PATTERNS

What Customers Do

What Brand Owners Do


Help Customers Strut their Stuff




Discover New Products & Services




Customers Will Create their own Mash Ups


Engage in Open Access and Peer Production


Next generation games: Co-designed by customers


Take-Aways








Patricia SeyboldCEO, Consultant, and Author

Patricia Seybold Group, Inc.

[email protected]

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