There is much talk about co-creation at the moment. The idea is that it is better to work closely with customers in developing an innovation rather than relying on traditional market research. This idea is correct.
Traditional market research on innovation comes in roughly three forms. The first seeks to watch or question customers to identify their needs, the second gets them to brainstorm solutions in groups, and the third seeks their reactions to the firm’s solutions through surveys or conjoint studies. So either we ask customers to express opinions or create solutions without concern for their practicality or we ask customers to react to react to the firm’s predetermined solutions. Usually third-party agencies do these jobs, creating a barrier between customers and managers.
None of this is satisfactory because both primary parties--customers and the firm’s managers—have something to contribute to a successful innovation. The customers their understanding of their needs and insights on what would work for them, the managers a deeper understanding of how to deliver a useful and profitable solution. Successful innovation needs a close dialogue to develop between customers and managers. If the firm uses an agency this should just be to help in finding the right customers, rather than intervening between managers and customers in their co-creation work. And when a close dialogue develops between the two there is ample evidence it can indeed lead to better innovations.
But, and this is a big but, effective co-creation needs the right customers and the right managers talking to one another. Put the wrong ones together and the firm almost guarantees failure. Put the right ones together then, while this does not guarantee success, you significantly increase your chances of it. So who is the right manager and who is the right customer?
Chapters Four and Five of the Innovation Manual deal with these topics extensively. The short story is that we know a lot about the characteristics of both and they do not look like the typical manager or typical customer. The typical manager is not mentally open to big new ideas, often because the culture of the firm does not support these, or because he or she worries about the opinions their superiors should the project fail. In the typical firm “failure” is a bad for your career prospects. The typical customer is also not mentally open to big new ideas, unless those ideas have the support of many other people. (Then if the idea turns out to be bad, at least many other people made the same mistake, and the customer does not look stupid). If these two brief (and overly simplified) stereotypes seem similar to each other that is because they are. Both managers and customers are human beings, and common patterns of behaviour drive human beings. To co-create we need executives, managers and customers who are open to big new ideas and prepared to consider directions outside the current norm. They also need to be creative to develop good solutions and to have some base of expertise that can contribute to the practicality of these solutions.
See the book for more details on these selection criteria and tools to turn these basic notions into a practical method for a firm to use. There is much more to this story than you can put in a blog post! But the above is the essence of the right managers and the right customers to co-create successfully.
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