The same analysis from IRI shows that while 34% of their respondents intend to increase R&D spending by 5% or more, those same respondents only 18% are intending to add headcount at the same rate. So companies are willing to increase spending – and along with it, their expectations for innovation – but not necessarily increase headcount to support it.
With so much on the plates of busy R&D teams, how can they possibly be expected to develop and modify product development and business processes to accommodate a social product innovation initiative as well? Keep in mind that social strategies, processes and technologies should enhance and extend the product development and innovation processes already in place, from idea generation and crowdsourcing through product development and management of in-market products. No need to create brand new processes here; social product innovation should support the business and innovation processes already in place, making them faster, easier and ultimately more successful.
Now may be the time to take that additional R&D budget and invest it in efforts to improve existing business processes for managing product portfolios and development pipelines. This includes proper governance and discipline to prioritize and manage development portfolios, as well as improved accessibility and availability of the information needed to make decisions.
Once that is done, companies can look at enabling those processes with new social models; for example, moving from a “closed”, internal innovation model to an open innovation model, where they collaborate with outside parties and external resources to develop new concepts and new products. A word of caution though – while pure “open innovation” models are incredibly valuable for creating a large volume of new ideas for the pipeline, someone still has to do the hard work of evaluating, prioritizing and deciding which of those ideas are worthy of pursuit.
To adopt an open model that helps meet innovation requirements and avoid overloading already constrained resources, successful companies are looking at semi-open innovation models. These models use defined groups of experts or customers as an innovation talent pool, so companies can take advantage of the same benefits of open innovation without the same overhead and effort required.
One example of this is virtual private expert networks. These are retained, contingent networks of 20-30 experts – including retirees looking for ways to stay engaged, easily-identified superstars from public networks, and academics – that operate virtually using a collaborative software platform to communicate with the organization and with each other as they develop concepts and build upon ideas.
Another semi-open example is networks of customers or consumers, which can help companies efficiently capture the voice of the customer. These work particularly well in B2C environments and come into play particularly during concept development and product positioning in a natural back-and-forth exchange of ideas to collect feedback and insights. These communities can be built out of targeted demographics – for example teens or seniors – where the internal R&D organization might not know exactly what’s in the mind of those particular consumers.
By identifying and selecting highly networked participants, companies also have the ability to build collective customer commitment to a product at launch, so the influencers are ready to help create some buzz in the marketplace. Similar to virtual private expert networks, customer communities are another source of capacity that add a valuable voice to the product development process in a very controlled fashion that does not require a significant investment of time and energy from internal resources.
Is your company considering adding social product innovation as an enabler to existing business processes? How did you incorporate these concepts? Have you tried to implement open innovation models with limited success? Have you experimented with a semi-open innovation model?
My next blog post will cover leading practices for navigating the myriad of technologies available to support social product innovation initiatives.
Amy Kenly has over 14 years professional experience in innovation, product development and PLM. Kenly, a regular speaker and blogger on social product innovation, has been selected by PDMA to author a chapter on “Social Media and New Product Development” for the upcoming third edition of the PDMA Handbook on New Product Development. Kenly leads Kalypso’s Social Product Innovation practice, which has recently published the white paper “Social Media and Product Development: Early Adopters Reaping Benefits amidst Challenge and Uncertainty.” To access the white paper and research findings, visit kalypso.com/spike.