May 25, 2005

News & Opinion: This book needs more love

By: 800-CEO-READ @ 2:44 PM – Filed under: Innovation & Creativity

I have not seen many talking about Eric Von Hippel's Democratizing Innovation. For all of you who believe that citizens are rising up to take back control, you need to check this out. If you are in business, you need to understand that your customers are probably modifying your products to work better for them. They may have a couple of ideas on how you could do things better or maybe you could give them the tools to do it themselves.

Here are three great pieces from the book:
  • Annual sales of lead user [citizen innovator] product ideas generated by the average lead user project at 3M were conservatively forecast by management to be more than eight times the sales forecast for new products developed in a traditional manner--$146 million versus $18 million per year.
  • ...[T]o say an innovation is minor is not the same as saying it is trivial: minor innovations are cumulatively responsible for much or most technical progress. Hollander (1965) found that about 80 percent of unit cost reduction in Rayon manufacture were the cumulative result of minor technical changes. Knight (1963, VII, pp. 2-3) measured performance advances in general purpose digital computers and found, similarly, that "these advances occur as the result of the equipment designers using their knowledge of electronics technology to produce a multitude of small improvements that together produce significant performance advances."

  • One major business of Nestle FoodServices is producing custom food products, such as custom Mexican sauces, for major restaurant chains. Custom foods of this type have traditionally been developed by or modified by the chains' executive chefs, using what are in effect design and production toolkits taught by culinary schools: recipe development procedures based on food ingredients available to individuals and restaurants, and processed with restaurant-style equipment. After using their traditional toolkits to develop or modify a recipe for a new menu item, executive chefs call in Nestle Foodservice or another custom food producer and ask that firm to manufacture the product they have designed--and this is where the language problem rears its head

    There is no error-free way to translate a recipe expressed in the language of a traditional restaurant-style culinary toolkit into the language required by a food-manufacturing facility...

    [Nestle created a toolkit to solve the translation problem.] Chefs interested in using the Nestle toolkit to prototype a novel Mexican sauce would receive a set of 20-30 ingredients, each in a separate plastic pouch. They would also be given instructions for the proper use of these ingredients. Toolkit users would then find that each component differs slightly from the fresh components he or she is used to. But such differences are discovered immediately through direct experience. The chef can then adjust ingredients and proportions to move to the desired final taste and texture desired. When a recipe based on toolkit components is finished, it can be immediately and precisely reproduced by Nestle factories...[R]esearchers showed that by adding the error=free translation feature to toolkit-based design by users reduced the time of custom food development from 26 weeks to 3 weeks by eliminating repeated redesign and refinement interactions between Nestle and purchasers of its custom food products.

The book has a Creative Commons license is available for download from Von Hippel's website. This should eliminate any reason not to read the book.

Other links to convince you to check out the book:

Video Lecture of Von Hippel (it is outstanding)
The Feature Interview with Von Hippel
Introduction Excerpt at Fast Company's website
Book Review from HBS Working Knowledge