User innovation

The latest issue of The Economist has an article on user-driven innovation. It's well worth a read, as it brings together a couple of important themes-- user reinvention, the economics of open source, and technologies of cooperation and collective action:

How does innovation happen? The familiar story involves boffins in academic institutes and R&D labs. But lately, corporate practice has begun to challenge this old-fashioned notion. Open-source software development is already well-known. Less so is the fact that Bell, an American bicycle-helmet maker, has collected hundreds of ideas for new products from its customers, and is putting several of them into production. Or that Electronic Arts (EA), a maker of computer games, ships programming tools to its customers, posts their modifications online and works their creations into new games. And so on. Not only is the customer king: now he is market-research head, R&D chief and product-development manager, too....

[T]he rise of online communities, together with the development of powerful and easy-to-use design tools, seems to be boosting the phenomenon, as well as bringing it to the attention of a wider audience, says Eric Von Hippel of the Massachusetts Institute of Technology, who is about to publish a book, “Democratising Innovation” (MIT Press). “User innovation has always been around,” he says. “The difference is that people can no longer deny that it is happening.” Indeed, it is “very likely that the majority of innovation happens this way,” says Mr Von Hippel. Such innovation, he says, has a “much higher rate of success”....

At the heart of most thinking about innovation is the belief that people expect to be paid for their creative work: hence the need to protect and reward the creation of intellectual property. One really exciting thing about user-led innovation is that customers seem willing to donate their creativity freely, says Mr Von Hippel. This may be because it is their only practical option: patents are costly to get and often provide only weak protection. Some people may value the enhanced reputation and network effects of freely revealing their work more than any money they could make by patenting it. Either way, some firms are starting to believe that there really is such a thing as a free lunch.

Comments

[Michael]

Companies everywhere should embrace this...with cautious optimism. For, with the explosion of self-promotion, not only will everyone be famous for 15 minutes, but, eventually, they'll figure out a way to make a buck out of it, too.