Platt Perspective on Business and Technology

Some thoughts on identifying potential marketplaces and customers in the face of novelty and innovation – 3

Posted in startups, strategy and planning by Timothy Platt on January 2, 2012

This is my third posting in a series on the challenges of truly innovative, disruptive New, and in developing it and marketing it so as to effectively reach and build a new market space for it (see Part 1 and Part 2.)

I laid out the basic issues in Part 1 of this series and the need for new insight if you are to see and build towards the true potential for a novel and marketplace-disruptive innovation. In Part 2, I at least briefly outlined two approaches to this: one with in-house control of all relevant information access, and the other more publically facing and with a focus on primarily controlling access to crucial information. My goal in this installment is to pick up on that discussion, focusing primarily on the outwardly facing and involving use of crowd sourcing. I will simply note with respect to the internal to the organization approach that:

• For some innovations, this is in fact the only route available and particularly where you would maintain your innovation strictly as trade secret protected.
• If you are actively seeking patent or related protection, or if your new innovation depends on a technology, process or device that is already under patent or patent-pending protection you are much less vulnerable.
• Though I add there, that patent protection in and of itself can be fairly illusory and particularly where someone else can develop from scratch and without using your specific technology to achieve the same product or service results.
• The history of patent law is in significant part the history of patent holders learning this the hard way as they see their own patents bypassed by alternative innovations developed by their competition.
• So there are some very significant reasons why in-house innovation and brainstorming would make sense.
• And there are consultants and consulting businesses that specialize in helping client businesses and their employees to break out of mental ruts and see innovative new ways of thinking – and both about what they do and how they do it.

But my primary focus here in this posting is on that other alternative, where partial disclosures are risked in order to gain value and insight from the crowd and from the marketplaces that you seek to bring into active form.

• I have already at least briefly discussed in Part 2, some of the considerations that would go into determining what you might be willing to go public with and what you would hold close as proprietary information, and when.
• I specifically note here that there are some significant unknowns in what you can reveal and when, as you have to assume that some of the people who would learn what you share concerning your innovation will be more insightful than others and highly motivated to act on any insight they gain – as active competitors to your business.
• But let’s assume that you have carved out areas of potential discussion that you would share. This may be because you see the most sensitive areas and aspects of your innovation as remaining safely in-house.
• This may be because you feel a level of protection from holding crucial patent rights and other legal protections that would safeguard you even if you did reveal more from in-house than you might otherwise desire.
• This may be because you see overriding value in developing market insight and market buzz, for when you launch your new innovation as a realized product. Getting the word out to position yourself as a marketplace first-mover can be a significant incentive in and of itself.
• This, I stress, can be post-product development as standard marketing campaign, but for purposes of this discussion this can also mean “going live” in conversation in at least a controlled way with public pre-release and even during product design and development. There, being able to say this product has crowd insight to make it a better fit to real user needs can be very beneficial.
• How do you filter out the valid and valuable feedback from the flow of everything else coming in, and particularly where you are only telling part of the story as to what you are doing, to preserve control over your own fundamental insight and innovation?

First of all, I want to address the value of the not-germane and unhelpful feedback that comes in from the crowd – if you see consistent patterns in that, where a lot of people seem to be making the same disconnects and sharing the same misunderstandings as to what you are doing, that can offer valuable insight too.

• Either you are simply not revealing enough to allow people in the crowd to understand what you are doing, and even just in general outline.
• Or there are gaps and inconsistencies in what you are sharing, and perhaps in your thinking and planning too that you need to know about.

But either way, you have to filter out the gems of insight from the clutter. And if you do this entirely from within the conceptual constraints you started with before you tried mining the crowd for insight, you are likely to miss spotting the real value in what you hear. So even if you do seek insight and perspective from the crowd, you probably will still want to include finding ways to open out your thinking in-house too. In this case if you do bring in one of those outside consultants to help you brainstorm, you will bring your pool of crowd-sourced feedback to the table as raw material to work with in doing that.

And through all of this and regardless of strategy or process employed for more widely imagining your innovation, the same basic dynamic prevails that you have to find an effective balance point.

• You need to balance the value of basing your innovation implementation at least in part on insight into the needs and preferences of real users and real marketplaces and coming from potential customers, and
• The fact that the more you share in this crowd sourcing, the more likely that you will gain insight of value,
• With the fact that the more you share and the earlier you do so, the more likely that you will be fostering direct and early competition for yourself too.

I have not discussed standard and sometimes very-misused tools such as focus groups here in this series and for a simple reason. Just considering that approach here, there is a lot already out there as to the strengths and weaknesses of focus groups where you in effect bring a sliver of the outside in, and in a very controlled manner.

Be creative in how you gain insight that would help you make a possible innovation a likely success and in how you filter and use any insights so gained. I add that you can also use a traditional approach such as focus groups to help you filter through more openly gathered, controlled crowd sourced insights for identifying the real sources of value in that.

• Effective, novel approaches to opening your eyes to the potential in your innovations and building better products from them can in and of itself be one of your most effective unique value propositions – and difficult to duplicate precisely because anything of this sort requires finding a working balance between conflicting needs and pressures.

I am certain that I will be coming back to this topic area for future postings. Meanwhile, you can find this and related postings at Business Strategy and Operations – 2 (and see also Business Strategy and Operations.) You can also find this and related postings at Startups and Early Stage Businesses.

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