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April 21, 2005

"Where-is-the-box" innovation?

(Posted by francois to: product innovation )

Decision Analysts (a market research and consulting company) released a white paper titled “In the box innovation” (get it here – free but requires registration) – via Corante’s Idea Flow and also Innovation Weblog.

The paper posits that too little effort is spent on idea generation in new product development while too many resources are being spent on the idea-to-product process. With an idea-to-successful-product ratio of 1.5% (based on a Dunn & Bradstreet report), they suggest that companies should spend more cycles on idea generation. And when they do that, they should not just focus on getting out-of-the-box ideas from their creative employees – a common practice amongst companies that have formal idea management processes.

Instead, they recommend that companies use directed innovation methods to uncover new ideas. Directed innovation is when you ask a group of people to brainstorm within a fairly narrow focus area. The hypothesis, which they try to confirm through an online innovation project conducted late last year (and described in the paper), is that if you use directed innovation you will generate more ideas, more innovative ideas, more “relevant” ideas, and more actionable ideas. The case study which they use to make their point involves two groups of people who were asked to brainstorm on a new chocolate product, one receiving much more directions than the other. Note that the people they recruited were not your average consumer. Here is what they have to say about those people:

“Our Imaginators™ panel consists of everyday consumers who have been recruited based on their high levels of idea-centric creativity, their ability to come up with many original ideas for new products and services, and their skill in elaborating on those ideas as well. Potential panelists must undergo a creativity evaluation and score within the top four percent of the population before they are invited to join.”

First – I agree with the authors that most companies should spend more time on the idea generation and the idea-to-concept part of the product lifecycle. It is during that part of the lifecycle that you determine all the factors that will affect the overall life-cycle cost of your product. And it is also that part of the process where most errors that lead to market failure can be tracked back to (i.e., misread customer needs, bad ideas, bad market timing, etc.).

I also agree that if you rely on brainstorming sessions to generate ideas you will get more ideas in a directed way than in a non-directed way. For most people it is easier to react to something than to create something out of the blue.

But what I don’t understand is why you would limit yourself to brainstorming to generate ideas? And when you do use brainstorming why not allow for both directed and undirected brainstorms? And why keep the process to a select group of “creators” like that?

Idea management should be an ongoing activity that involves not only all employees but also customers, prospects and partners. If you treat idea generation as an episodic process that needs to be turned on and off only when you are ready for a new product, I contend you will miss lots of excellent ideas. And if you limit yourself to the creative types you will miss out as well.

Besides “directed” innovation there is also such a thing as “emergent” innovation – the water cooler type of innovation – which happens when a set of people share/critique/build upon ideas and thoughts with one another. Emergent innovation does not only benefit from the contributions of creative types, it also benefits from good “critics/reviewers”, and good “scanners” (those are the folks that can connect seemingly disparate pieces of information), just to name a few.

In the past it would have been too expensive to set up such broad idea gathering and management initiatives. But with the advent of the web, blogs, wikis, rss, discussion boards, tagging, customer-centric application software, etc. - it should be possible to have large, ongoing, multi-channel conversations in the marketplace at a very low cost.

Oh yeah...one more thing. If in the process you end up with workable ideas that do not fit your corporate objectives – sell them!

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Posted by francois at April 21, 2005 4:49 PM | Bookmark This

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Posted by: azahari at July 21, 2005 5:38 AM

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