Platt Perspective on Business and Technology

Keeping innovation fresh – 16: adding the crowd to this puzzle

Posted in strategy and planning by Timothy Platt on April 20, 2012

This is my 16th installment in a series on innovation, and on finding and developing paths to bring it to productive fruition within an organization (see Business Strategy and Operations – 2, postings 243 and scattered following for parts 1-15.) So far I have been discussing the development and productive implementation of innovation within an organization, and through consistent processes and mechanisms that would limit the loss of value that comes from ad hoc and unstructured approaches. I began with two case studies in this, that I have repeatedly referred back to, and after discussing industrial research and innovation centers and a variety of other standardizing systems and processes, I added in the capturing of innovative value as it arises in production, distribution and marketing in the more marketplace-facing lines of the business.

My goal in this posting is to connect the lines of reasoning and argumentation that I have been developing through the first 15 installments of this series with a line of reasoning and chain of evidence that I have been developing throughout this blog as a whole.

• Businesses do not and cannot function in a vacuum. They exist and operate in and as part of supply chains and complex business ecosystems.
• Businesses can and do hold confidential and proprietary information, but increasingly they operate in environments awash in information and expertise – no business can safely assume that they hold a monopoly on the expertise underlying their products or services, or even just of the sources of unique value they would bring to the marketplace.
• So effective implementation of innovation in creating and offering value to the marketplace has to include a blending of data, knowledge and insight developed in-house with complementing data, knowledge and insight that is brought in from the marketplace and from the business’ outside context in general.

And that is where crowd sourcing enters this discussion.

I have been writing about crowd sourcing in this blog for a couple of years now, and in that context cite some of my entries in that area:

Crowd Sourcing and the Opening Up of Open Innovation,
Planning an Innovative Offering to be Turn-Key Ready – 3: crowd sourcing and the permeabilization of corporate walls,
• My series Crowd Sourcing, Open Innovation and Open Organization, as can be found at Social Networking and Business as postings 44-46,
The Myth of Usability – and the impact of crowd sourcing as needs complexity expands, and
Meme Tracking as a Crowd Sourcing Killer App.

I have, among other things, discussed the issues of what to and not to crowd source as to a business’ unique value propositions, and simply note the lack of exclusivity that comes with crowd sourced insight and knowledge as one consideration there. But one of the key issues that has come up in this series as well as elsewhere in this blog is the need to connect the value offered to the marketplace to the needs and desires held by the people who comprise that marketplace. And as already noted in this series,

• The more novel and disruptively innovative a new product or service would be, the less market insight its developers and providers start out with, as they seek to create new business opportunity from it.

So I cite the crowd here, and externally sourced insight as potentially invaluable for helping a business commoditize an innovative insight into more effectively and readily marketable offerings – that real world consumers will seek out to purchase.

• This is where Marketing, and the development of marketing intelligence is crucial, and where simply gathering pre-developed demographics data that was developed absent any awareness of the business’ potential innovation might not suffice.
• If you primarily turn to stock demographics data resources, in-house developed or third party sourced for insight as to market needs and opportunity, and to data that comes from initial sources unaware of even the outline potential of what your business would offer, the more novel your potential offering the more likely you will not even be considering the right basic demographics parameters or groups to look at.
• I add that the artificial and somewhat stilted context of standard marketing intelligence tools such as focus groups can fail too.

And this is where new tools are needed for tapping into the crowd for insight, and even as potential sources of market insight open up and become available and even as this insight becomes more crucially important for business success.

Setting aside that challenge, at least for purpose of this discussion:

• Crowd and other externally sourced insight would be shared throughout the organization, and both to the marketplace facing lines and to the research and innovation center, and
• Responsibility for this information resource sharing would be held at least in part by the transition committee that serves to connect research and innovation efforts to the rest of the overall organization.

I am going to finish this series at this point, at least for now. I add that I am also planning on starting a new series on connecting into the crowd as a source of insight and market advantage. Meanwhile, you can find this and related postings at Business Strategy and Operations – 2 (and also see Business Strategy and Operations.)

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