Contours of Service Innovation: IBM

Posted on April 30, 2008 by Gary R Schirr

Everyone familar with this blog probably has heard the statistics:

  1. 80% of the US economy is services
  2. Less than 30% of innovation spending is on services
  3. Very little of the academic or practitioner research literature on innovation involves services

The purpose of this blog is to begin in a small way to address these imbalances!

IBM has been involved in a consortium for studying service science (a link to their site is on the right). They have –with the University of Cambridge — released a new report the contours of service innovation which is available here:

http://www.ifm.eng.cam.ac.uk/ssme/documents/080428cambridge_ssme_whitepaper.pdf

Or as an executive summary:

http://www.ifm.eng.cam.ac.uk/ssme/executive.html

Business week wrote a short article about it as well:

http://www.businessweek.com/innovate/next/archives/2008/04/ibm_the_new_con.html

 

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Interview with Eric von Hippel (2007)

Posted on April 27, 2008 by Gary R Schirr

von Hippel talks about his insight into user-driven innovation for services and goods in this 2007 interview:

http://www.gartner.com/research/fellows/asset_172822_1176.jsp

The PDMA blog points out some of the high points in the interview, so I can be lazy:

http://blog.pdma.org/

von Hippel was talking about co-creation in the mid-70s…

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“Process IS the product”

Posted on April 23, 2008 by Gary R Schirr

Service Innovation: Intrinsically Holistic?

Process is the Product

Ed Furash, a well-know bank consultant, was quoted by a banker I interviewed in my NSD research as saying “In financial services process is the product.”

One of the problems with applying NPD models and ideas developed for goods firms to NSD may be that NPD has typically differentiated between product innovation and process innovation.

When automation allows a washing machine to be built in 2 hours rather than over two shifts, quality or price may ultimately be impacted. When online tools allow a mortgage to be granted in one hour rather than one week, the service itself has been dramatically changed.

Those of us interested in service innovation must take a more holistic approach and view innovation in a broader context.

Business Model Innovation is Intrinsic

Helder Sebastiao, professor of entrepreneurship at the University of San Diego, sent me a note yesterday in which he noted that a central theme through the postings in newservicecreation is that in service innovation, unlike NPD-goods, “business model innovation is intrinsic“.

It may be that the key difference between service innovation and traditional NPD-goods is that service innovation is more holistic:

  1. Process is the product
  2. Business model innovation is intrinsic.

Your thoughts??????????

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Innovation vs. Invention

Posted on April 23, 2008 by Gary R Schirr

Innovation is not invention

A good discussion of this ongoing theme in Nussbaum’s column on whether Apple is innovative or adaptive:

http://www.businessweek.com/innovate/NussbaumOnDesign/archives/2008/04/is_apple_innova.html#more

 

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“Many crummy trials BEAT deep thinking”

Posted on April 20, 2008 by Gary R Schirr

Just do it

Last week I noted Clay Shirky’s comment that for internet innovation “the cost of trying is lower than the cost of analyzing.”

I noted that this was an affirmation of the “Probe and Learn” process advocated by Lynn and Morone in the 90s. Many customer engagement techniques discovered by analyzing high-tech firms in the 70s-90s seem even more relevant in the internet era. “Probe and Learn”, “user toolkits” (von Hippel), “experimentation” (Thomke), and others seem to be more relevant and useable in the Internet era.

This week’s internet example comes from a course at Stanford that assigned students to develop applications for Facebook.

B.J. Fogg, the instructor, noted “Many crummy trials beat deep thinking.”

http://www.slideshare.net/bjfogg/10-million-in-10-weeks-what-stanford-learned-building-facebook-apps

His key insights from observing the students include

Speed & flexibility in launch & iterations

  1. Many crummy trials beat deep thinking
  2. Flexibility beats quality
  3. Deadly: Getting too attached to one app idea.

Trying is cheaper than analyzing! Crummy trials beat deep thinking!

Nike seems to have it right: Just do it TM

Linear (or parallel…whatever), analysis-heavy, processes for NPD don’t seem to fit this model…they think about it; they don’t…just do it.

Posted in Co-creation or User collaboration, Customer Research Methods, experiential innovation, Experiment, NSD Process | Tagged , , , , , , , , , , | 4 Comments

Beta Culture

Posted on April 17, 2008 by Gary R Schirr

New Service Development and Agile Programming

Several people have emailed me for a definition of Beta Culture as mentioned in the posting yesterday. [Please consider posting a comment: WordPress makes it easy and then everyone can see it.]

Beta Culture is highly relevant to service innovation. Again it is an expansion of the Lynn and Morone “probe and learn” idea. Get a decent service into the market and let your customers improve it. It is similar to concepts in Agile Programming. This blog talks more about it:

http://adscovery.wordpress.com/2006/10/08/the-beta-culture/

 

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Happy Birthday Nokia Beta Labs

Posted on April 17, 2008 by Gary R Schirr

Open for one year…working toward co-creation and beta-culture

Nokia Beta Labs is a virtual organization to support “Nokia R&D teams (hundreds or thousands of people) and the beloved user community (~100k people and counting) to shape the future together.”

The site notes these measures of success:

  1. 4+18 application launches
  2. huge usage growth: ~1M page views, ~200k downloads, and thousands of comments / month already
  3. vibrant user community: experimenting with new apps, sharing thoughts, and helping each other
  4. early signs of a massive culture change inside Nokia, towards co-creation and beta culture

Check out their site.

http://betalabs.nokia.com/blog/2008/04/16/celebrating-beta-labs-1-year-birthday/

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My first academic pub

Posted on April 16, 2008 by Gary R Schirr

 Sixteen Years of NPD Research

The first academic article in the May issue of Journal of Product Innovation Management is a review of 16 years of new product development aticles in leading NPD, R&D, Marketing and Management journals written by Albert L. Page of the University of Illinois at Chicago and me here at Radford U.

The main conclusion of interest for readers of this blog would simply be that despite the fact that services are 80% of the economy, little academic NPD research has focused on services. Furthermore the research that HAS been done on services has largely focused on how well NPD models developed for goods innovation fit service innovation.

It is also interesting to note that much of the academic research on NPD continues to focus on the effectiveness of process variables — such as the use of Stage-Gate(R) procedures  or multi-disciplinary teams — despite a meta-analysis (Henard & Szymanski 2001) that showed that process variables had little effect on NPD success compared to marketing variables such as meeting customer needs.

—–

This is my first academic publication (the tenure clock is ticking). It is frustrating to realize how much more effort such an article takes than my former articles for industry publications; while knowing that I will never get as much feedback as I did on an article such as the one I wrote for Futures Magazine a couple years ago on innovation in online trading systems.

But reading 16 years of research on NPD was probably a good way to launch my own life 2.0.

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“A Fair Hearing” for customers

Posted on April 14, 2008 by Gary R Schirr

A proposed procedure for uncovering customer needs

The press release from Strategyn breathlessly announces that an article by two of its principals in the Sloan Managment Review “renders… traditional Voice-of-the-Customer research obsolete…”

http://www.businesswire.com/portal/site/home/index.jsp?epi-content=NEWS_VIEW_POPUP_TYPE&newsId=20080410005089&newsLang=en&beanID=1791428325&viewID=news_view_popup

In reality their proposed procedure makes extensive use of VOC techniques to uncover customer needs through a four-step process:

  1. Personal 1:1 interviews to understand the cutomer’s job
  2. In-depth observational interviews or ethnographicaly study to understand context
  3. Personal or group interviews to find success metrics used by customers
  4. Personal interviews to check details.

The only step that deviates from the VOC principles of Griffin and Hauser would be step 3, which allows for group interviews. However the authors point out that these group sessions would not be idea-killing focus groups or brainstorming sessions, but would serve to simply collect actual metrics that are already in use.

Note that two (or potentially 3) of the steps use 1:1 individual interviews. The Visions article by Cooper and Edgett that I mentioned in an earlier post, focused on VOC but left out this preferred technique. (They also treated focus groups as if they were a technique promoted by Griffin and Hauser.)

This seems to be a good application of VOC principles. The full article is available in the current ( Spring 2008 ) issue of Sloan Management Review or on the Strategyn site, linked under my “selected consultants” grouping on the right bar.

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More ethnography — Nokia

Posted on April 12, 2008 by Gary R Schirr

NY Times article on ethnographic research by Nokia

One of the readers of this blog, who is involved in ethnographic research, made an interesting comment on the last post — give it a read.

He also suggested a NY Times article about how Nokia was using ethnography in the third world. It is an interesting application of ethnographic research:

http://www.nytimes.com/2008/04/13/magazine/13anthropology-t.html?em&ex=1208059200&en=a3f185a62fe41fb5&ei=5087%0A

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