Posts filed under 'Customer Development'

Listening to Customers

Add comment March 18th, 2010

In “Moore’s Law Beats Customer Feedback” Chris Morris highlights a quote by Jensen Huang from an April 8, 2009 talk at the Stanford Technology Ventures Program on “Favoring Moore’s Law Over Customer Feedback“  (Mr. Huang has a number of talks available on Stanford’s Entrepreneurship Corner):

Sometimes you have to ignore your customers and follow Moore’s Law.

My feeling is that Moore’s Law is customer feedback.

What I think he means “ignore some of your more established prospects.” NVIDIA sold chips to customers in its first five years. By that I mean that they had customers that were using their products.  Just not to some of his larger potential prospects. NVIDIA also had SGI as an “existence proof” for a market for high end graphics. They had lead customers from the beginning, he doesn’t mention who they are, choosing to focus on the larger prospects who were initially not interested, but they didn’t invent their architecture in a vacuum. For example, from Firing Squad’s History of NVIDIA:

Curtis Priem, NVIDIA Chief Technical Officer, had been the architect for the first graphics processor for the PC, the IBM Professional Graphics Adapter, and more recently had developed the GX graphics chips at Sun Microsystems. Chris Malachowsky, VP of Hardware Engineering, was a Senior Staff Engineer for Sun Microsystems, Inc., and was co-inventor of the GX graphics architecture.

In fact, when it came to standards for representing 3D they initially picked the wrong standard and had to “listen to their customer” and change horses. See, for example Tom’s Hardware: 13 years of NVIDIA History:

The principal problem with the NV1 was in its management of 3D: it used quadratic texture mapping (QTM) instead of the technique used currently, which is based on polygons. DirectX appeared just after the card was released, and it used polygons, so the NV1 was a failure over the long term. [...] The NV2 used the same rendering method and was never completed. It was to have been used in the Dreamcast console (which replaced the Saturn), but Sega finally chose a polygon-based technology (PowerVR) and Nvidia abandoned QTM in favor of polygon-based rendering with the NV3.

My take away is that if a large established customer shows no interest, talk to smaller players who are interested in becoming larger and help them to disrupt the market. Don’t wait for the established players to embrace your product idea before proceeding.

Customer Development Helps Entrepreneurs Assess the Value of an Invention

2 comments February 13th, 2010

Colin Cherry in “The Telephone System: Creator of Mobility and Social Change” makes the point that the full impact of an invention is very difficult to predict (emphasis added).

Inventions themselves are not revolutions; neither are they the cause of revolutions. Their powers for change lie in the hands of those who have the imagination and insight to see that the new invention has offered them new liberties of action, that old constraints have been removed, that their political will, or their sheer greed, are no longer frustrated, and that they can act in new ways. New social behavior patterns and new social institutions are created which in turn become the commonplace experience of future generations.

Such realization does not come easily, quickly, or even “naturally,” for the new invention can first be seen by society only in terms of the liberties of action it currently possesses. We say society is “not ready,” meaning that it is bound by its present customs and habits to think only in terms of its existing institutions. Realization of new liberties, and creation of new institutions means social change, new thought, and new feelings. The invention alters the society, and eventually is used in ways that were at first quite unthinkable.

I think that we are now at a transition point in our use of web applications: the larger challenge for software entrepreneurs is not inventing a new technology, but determining how to apply the last two decades (Tim Berners-Lee had the first webserver working in 1990, SLAC had one in 1991) of invention to business problems in new ways, many that would have been unthinkable earlier.

This is what customer development helps entrepreneurs to understand: how to apply inventions to problems that customers will pay them to solve.

I Don’t Understand, We Won the Argument, Why Didn’t We Win The Sale?

Add comment February 9th, 2010

Three true stories:

We were driving back from a sales call and the CTO said “I don’t understand. We won the argument. Why didn’t we win the sale?” He was very disappointed at their stupidity and stubbornness.

Different startup, I had been recruited by a new CEO as a part of a turnaround. A team had gone off to meet with a new prospect and I asked the sales rep how the meeting had gone. He said “It was one of those meetings where the actual purpose of the meeting became figuring out who the smartest person in the room was: one of our guys or one of theirs. After a while it was time to leave.”

About a decade ago while I was still at Cisco I got invited to a large meeting with an outside vendor. Cisco had two software vendors providing similar but incompatible tools that solved the same problem in different ways. Times were tight:  folks were being laid off and projects were getting canceled. Our inability to be able to share scripts and models between these two tools meant that management had decided we needed to standardize on one. This was a meeting for all of the supporters of tool A to compare notes and develop a common set of reasons why it should be the standard. The vendor sent a large contingent and there were perhaps two dozen engineers from different groups who were concerned. What a disaster. The vendor essentially started off by implying that the users had done a poor job of educating management as to the value of the tool and listed a number of improvements and techniques that they had “taught” us. After perhaps ten or fifteen minutes, someone spoke up and said, “Hey, wait a minute, that was an idea that we gave you! You incorporated into version 7, but we had that first.” The meeting degenerated into an angry shouting match and the default plan became engineers would refuse to switch to the other tool. Not a winning strategy in a downturn as it turned out.

Diagnosis: in each case the startup didn’t view the customer as a partner, and somehow believed that they would succeed by convincing them that they were smarter. This is called the “bringing fire to the savages” sales and marketing model. Variants include viewing your product as a luxury good “not everyone can own our product” or an IQ test (“not everyone is smart enough to be able to use our product”). None of them are particularly effective in generating revenue or reference customers but they do preserve the world view of the founders that they are all a bunch of really smart people.

Three specific antidotes:

  1. Focus on understanding the customer’s problem. Make sure you can describe their problem before you start to describe your solution. Test for other symptoms that they have not mentioned that you have heard from other customers. Do all of this before you mention any features or benefits of your offering.
  2. Understand specifically what steps they have already taken to address the problem and what constitutes their perception of the status quo.
  3. When you propose your solution, make it as compatible with their current work process and practices as you can, and incorporate any of their ideas into your product roadmap that you believe may benefit other customers or prospects. This minimizes their transition cost and their sense of loss.

We help software firms explain their new product to the right prospects in ways that convince them to become reference customers.  If you have a new product and are having difficulty getting people to understand what it can do, please give us a call: we can help.

Related posts:

Saras Sarasvathy’s Effectual Reasoning Model for Expert Entrepreneurs

2 comments February 7th, 2010

Recapping ideas, papers, and books that had changed my life yesterday reminded me of Saras Sarasvathy’s Effectual Reasoning Model from her 2001 paper “What Makes Entrepreneur’s Entrepreneurial” (There is an annotated version on the Khosla Ventures site at http://www.khoslaventures.com/presentations/What_makes_entrepreneurs_entrepreneurial.pdf )

What follows are some quotes from “What Makes Entrepreneurs Entrepreneurial.”

Effectual reasoning, however, does not begin with a specific goal. Instead, it begins with a given set of means and allows goals to emerge contingently over time from the varied imagination and diverse aspirations of the founders and the people they interact with.

Effectual thinkers are like explorers setting out on voyages into uncharted waters.

All entrepreneurs begin with three categories of means

  1. Who they are–their traits, tastes,and abilities;
  2. What they know–their education, training, expertise, and experience
  3. Whom they know–their social and professional networks.

In our “Idea to Revenue” Workshop we talk about three kinds of capital that startups begin with: intellectual, social, and financial. We don’t call out what she refers to as “human capital” or “who they are–their traits, tastes, and abilities” as a resource but instead encourage teams to “begin in phase two.” That is, to build on prior accomplishments and long term interests so that early customers view the startup as a continuation of earlier efforts and focus.

But I like this model of bootstrapping entrepreneurs as foragers: living off the land as hunter-gatherers until they can find a market to homestead. Bootstrappers have to start from where they are and search for opportunities. Pasteur advised that “Chance only favors the prepared mind” so you have to open yourself up to possibilities and be prepared to be surprised (which is another way of saying you have learned something new). Some more quotes from her paper:

Using these means, the entrepreneurs being to imagine and implement possible effects that can be created with them. Most often they start very small with the means that are closest at hand and move almost directly into action without elaborate planning.

Plans are made and unmade and revised and recast through action and interaction with others on a daily basis. Yet at any given moment, there is always a meaningful picture that keeps the team together, a compelling story that brings in more stakeholders and a continuing journey that maps uncharted territories.

Eventually certain of the emerging effects coalesce into clearly achievable and desirable goals–landmarks that point to a discernible path beginning to emerge from the wilderness

Seasons entrepreneurs, however, know that surprises are not deviations from the path. Instead they are the norm, the flora and fauna of the landscape, from which one learns to forge a path through the jungle. The unexpected is the stuff of entrepreneurial experience and transforming the unpredictable into the utterly mundane is the special domain of the expert entrepreneur.

One of the reasons that we run the Bootstrapper Breakfasts as 90 minute unconferences–where folks introduce themselves and put issues on the table they would like to discuss–is that it keeps everyone in an entrepreneurial frame of mind:

  • When you hear someone describe a challenge that they are facing, it gives you much better insight into their thinking and allows you to evaluate what they might be like to work with.
  • Often as not they are describing a common problem, or aspects of a common problem. Hearing their perspective just on the problem can give you new insights into how to solve it.
  • It’s good practice to learn how to ask for advice and insight. Entrepreneurs need to do a lot of that in the early market especially.
  • Explaining how you managed an issue or situation can deepen your understanding of you solution, it forces you to put it into terms others can use and understand. This is good practice for scaling up (e.g. adding your first employee).

Sarasvathy stresses the cooperative nature of entrepreneurship in the paper, a perspective that I share. Often an entrepreneur is attempting to obsolete an aspect of the status quo, but they have much less competition and much more opportunity for collaboration than is appreciated.

Markets are stable configurations of critical masses of stakeholders, who come together to transform the outputs of human imagination into the forging and fulfillment of human aspirations through economic means.

Effectual reasoning may not necessarily to increase the probability of success of new enterprises, but it reduces the costs of failure by enabling the failure to occur earlier and at lower levels of investment.

Entrepreneurs are entrepreneurial, as differentiated from managerial or strategic, because they think effectually; they believe in a yet-to-be-made future that can substantially be shaped by human action; and they realize that to the extent that this human action can control the future, they need not expend energies trying to predict it. In fact, to the extent that the future is shaped by human action, it is not much use trying to predict it–it is much more useful to understand and work with the people who are engaged in the decisions and actions that bring it into existence.

She highlights three key differences between effectual reasoning and traditional startup management models:

  • Risk taking
    • Traditional: expected return, work the plan to deliver results to your investors (“Ready Aim Fire” can become “Aim–not big enough–Aim–not big-enough–Aim…”).
    • Effectual: affordable loss, make many small mistakes as early and cheaply as possible to speed learning (“Ready Fire Steer“)
  • Focus:
    • Traditional: competition
    • Effectual: strategic partnership (especially with early customers)
  • Value Creation
    • Traditional: rely on pre-existing knowledge to aim for a known market you can dominate and exploit
    • Effectual: leverage contingencies; create opportunities as you map a new market

She goes into some detail on the “affordable loss principle” and offers extracts from an interview with an expert entrepreneur’s approach to a new market:

While managers are taught to analyze the market and choose target segments with the highest potential return, entrepreneurs tend to find ways to reach the market with minimum expenditure of resources such as time, effort, and money. In the extreme case, the affordable loss principle translates into the zero resources to market principle. Several of the expert entrepreneurs I studied insisted that they would not do any traditional market research, but would take the product to the nearest possible potential customer even before it was built. To quote but one of them, “I think I’d start by just… going… instead of asking all the questions I’d go and say.. try and make some sale. I’d make some… just judgments about where I was going — get me and my buddies — or I would go out and start selling. I’d learn a lot you know..which people.. what were the obstacles.. what were the questions.. which prices work better and just DO it. Just try to take it out and sell it. Even before I have the machine. I’d just go try to sell it. Even before I started production. So my market research would actually be hands on actual selling. Hard work, but I think much better than trying to do market research”.

In finding the first customer within their immediate vicinity, whether within their geographic vicinity, within their social network, or within their area of professional expertise, entrepreneurs do not tie themselves to any theorized or pre-conceived “market” or strategic universe for their idea. Instead, they open themselves to surprises as to which market or markets they will eventually end up building their business in or even which new markets they will end up creating.

This is also an approach that favors older entrepreneurs to the extent that they have larger social networks (based on more shared work experience with more people) and deeper professional expertise. The one caveat is that they have to be open to new possibilities and not be blinded by what they “know” to be true in the face of new information.
This 2001 paper offers another perspective on bootstrapping entrepreneurship that is independently derived and predates “Four Steps to the Epiphany (2003)”, “Blue Ocean Strategy(2005)”, and the “Sales Learning Curve (2004).” But all four are clearly addressing different aspects of the same core paradigm that takes a scientific or hypothesis driven approach to new products and new markets.

I will leave with two final quotes from the paper which highlights the value of establishing enduring relationships.

Expert entrepreneurs [...] are actually in the business of creating the future, which entails having to work together with a wide variety of people over long periods of time.  [They fill their future] with enduring human relationships that outlive failures and create successes over time

This is largely ignored in our entrepreneurship curricula which tend to focus on market research, business planning, new venture financing and legal issues. As far as I know no entrepreneurship programs offer courses in creating and managing lasting relationships or stable stakeholder networks, nor on failure management.

Related Posts

Two Customer Development Examples: SixApart & WowzaMedia

1 comment February 1st, 2010

I answered a question recently for real examples of teams using customer development approaches to software startups and drafted the following reply
First Example: Michael Sippey of Six Apart

I blogged about an August 2006 talk by Michael Sippey of SixApart in January of 2007 at SVPMA (his slides are here http://www.svpma.org/eventarchives/sixapart.pdf )
If you read through Michael’s slides and my notes from his talk you will see that he offers four stories of new product introduction:

  • Moxy, based on getting out of the building and watching how customers used other products
  • A next generation jukebox, based on raising a lot of money and building something that was cool but not compelling
  • TypePad’s “Big Bang” where they launched a major release with many new features, some of which didn’t work
  • TypePad’s transition to a fast iteration model where they launch a few features on a two week cycle

Sippey never mentions Steve Blank or customer development but he is following many of the key methodology principles of customer development in his two success stories. For example, here are some of his key questions (note the focus on getting out of the building, a sequence of demos/prototypes, the focus on customer pain/problem, and asking the customer to prioritize features):

How we did it.

  • Find 30 prospects. Set up meetings.
  • Demo your idea / alpha / beta / product.
  • Ask questions. (Lots of questions.)
  • Take copious notes. Score your results.

Critical questions.

  • Do you have this problem?
  • Does this solve your problem?
  • How much would you pay for this?
  • Base hit or home run?
  • How would you spend $100 of our money?

Second Example: Dave Stubbenvol of Wowzamedia

I interviewed Dave Stubbenvol in January 2008. Dave is CEO of Wowzamedia and a five time serial entrepreneur. Again, without mentioning Steve Blank he outlines how he has followed customer development principles in building Wowzamedia to a successful bootstrapped company. Here is a long excerpt where he outlines their focus on trying things and seeing if they are of use:

Q: It seems like you have had a clear sense of priorities with WOWZA?

With WOWZA our focus is on three key things: making sure that we will be around, making sure that we are meeting customer needs today, and staying flexible enough to meet customer needs for the future.

Q: I talk to many entrepreneurs who take a “if I build it they will come approach.” We met just over a year ago, before you had even launched. Can you talk about the amount of preparation, the strategies, and your implementation plan just to get ready for launch?

This time with WOWZA, launch was sort of a crazy thing for us. We basically started the company because we wanted to explore the possibilities for new applications that emerging media technologies enabled. Originally, we never actually expected to make money with what we built. Not really your typical way of starting a business.

My co-founder and I had prototyped a hybrid video blogging system. It was this unholy hybrid of WordPress, the Adobe Flash Communication Server, and then Flash Media Server. While messing around, we found out that Adobe Flash Communication Server, Flash Media Server was just not good enough. The product wasn’t stable enough, it was unreliable, it had lousy performance, it was ridiculously expensive, and it just was not good enough for us. So, we decided to write our own, and we put that into our product.

Prior to launch we did all the standard things like press releases, some advertising, having reference customers, having customers ready to buy on the launch date, and building up the market. However, we did not pour boatloads of money into the initial marketing. For two reasons: first we figured we would get it wrong at the start, and second we felt that this was a one off product. Our primary intention was to establish the company and build a reputation. We want to be the guys who know what they are doing, tell you the truth, and deliver a damn good product. The truth is with a one off product there are going to be problems, no doubt about it. We went ahead and launched in February 2007, got out there, got press in a couple of places, people came, and we made sales.

These two data points for companies that still around and growing. They don’t mention that they follow “Four Steps” but both are clearly following the key principles of customer development for the customer discovery and customer validation phases.  This should help substantiate that successful firms have followed customer development principles.

We follow them in working with our clients (I should make clear that neither SixApart nor Wowza were or are clients) who are primarily teams of two to five engineers. They find a “scientific approach” to the early market that involves focused experimentation to be very useful.

Sean Murphy – I Don’t Read Him Regularly, But I Hear That I Should

4 comments January 20th, 2010

In a long and somewhat rambling blog post “Customer Development and the Lean Startup,” that contains a long laundry list of resources for entrepreneurs on Customer Development and Lean Startup resources, Yury Tsukerman lists “the key players” and drops this short comment

Sean Murphy – I don’t read him regularly, but I hear that I should.

Not since Techdirt used me in a promotional picture (see “Born with a Face Made for Podcasting“) have I felt such a sense of warm endorsement. So here is a tip for my 15 readers on how to deal with your 285 nano-centuries of fame: add a nice comment to the bottom of the blog. Which I did:

I think a post that describe how you have applied a subset of these principles and what you have learned would be very useful, it’s clear that you have your own insights on these topics.

There is a good conversation going on in the Lean Startup Circle, it would be great to see you take part.

I have a blog category devoted to Customer Development if you are interested.

If you are having trouble finding time to read my blog here are five posts that I believe represent the range of my writing. Clearly I need to take a page out of the Venture Hacks notebook and create an index for the 550 posts I have written over the last four years.

But it’s been a few weeks and I am not closer to my master index so I would appreciate your help. Let me know which of my blog posts you found especially useful (or an old one now desperately in need of a re-write/update) and any areas or topics you would like to see me address.


Notes

  1. “In the future, everyone will be famous for 15 people” Momus (Nick Currie) in “Pop Stars Neine Danke
  2. One handy conversion factor to remember is Tom Duff’s “Pi seconds is a nanocentury.
  3. “In the future everyone will be famous for 15 minutesAndy Warhol 
  4. Fewer footnotes probably not a bad idea either.

Customer Development Proceeds in Parallel with Product Development

1 comment December 17th, 2009

Steve Blank had a great post today “Building a Company with Customer Data, Why Metrics Are Not Enough” that highlights the need–even for Web Startups–to get out of the BatCave and talk to strangers who may be potential prospects. Engineers in particular can feel that this is not as productive a use of their time as some form of automated interaction. As Steve recounts, here is a typical reaction when he suggests that surveys in particular are not the best way to start:

“We’re a web startup, all our customers are on the web.  Why can’t I just get them to give me the answers I need this way?”

Often founders may try and substitute market research data for “seeing the elephant” or having actual contact with live prospects. Blank warns:

…market research firms are excellent at predicting the past. If they could predict the future, they’d be entrepreneurs.

There were two questions in the comments related to when and how to talk to prospects:

Q:  At what point in the process of our startup do we want to start getting interactive feedback from our target market? How much focus should we give to gathering customer preference while we are still in the inception phase of our idea?

As soon as you can clearly articulate your hypotheses about the customer’s problem you should get out of the building and start having serious conversations. Customer Development proceeds in parallel with product development and informs it.

One piece of paper with a prospect’s name and a few questions can communicate that you care about their perspective and have given some thought to making it a productive 10-20 minute conversation (if they want to talk longer you should let them, but you should be able to finish a short conversation in ten minutes or so).

Q: Talking to your customers directly is awesome. But, what is even better is to get a group of your customers to talk to you AND each other.

In the early market this is can cause problems when interviewing prospects: focus on one conversation at a time. Don’t let one prospect’s perspective who speaks first on a topic inadvertently anchor the group somewhere. Instead ask open ended questions and listen, prepared to be surprised.

Consider an appreciative inquiry approach to understand the customer’s operating reality.

Customer focus groups are effective for feature planning but more problematic in determining product/market fit in the early market.

Early Customer Conversations: Use Appreciative Inquiry and Amplify Positive Deviance

2 comments December 15th, 2009

Q: Does anyone have a customer interview script that they use?  What is the focus of the interview and can some of that interaction be replaced by really evaluating analytics (for web based enterprises)?

This question came up on the Learn Startup Circle List recently and I took the time to answer it.

I think the “Appreciative Inquiry” model offers a very effective model for early customer interviews. At a high level it’s

  • “What problems are you having?”
  • “What’s working around here?”

You need to focus on their pain and problems but build on their strengths. While there is a whole methodology/discipline you can follow at the Appreciative Inquiry Commons with “What is Appreciative Inquiry” a good place to start, I found the “Thin Book of Appreciative Inquiry” to be $8 and two hours well spent. It’s only 63 pages long but I found myself stopping several times and realizing I needed to change what I had been doing.

The “Amplify Positive Deviance” model developed by Jerry Sternin is another useful one to determine what the real status quo is for a category of prospect. Here are two good sources of information

I have transcribed the 7 steps in the “Positive Deviant” article and added a customer development interpretation for some of them in parentheses.

  1. Don’t assume you have the answer  (treat your approach as a hypothesis to be validated, updated, or refuted)
  2. Interview folks in settings where they are most likely to be forthcoming
  3. Encourage small steps using a new approach/tool/technology (get simple product in customers hands)
  4. Identify current status quo
  5. …and how positive deviants depart from it (different between early adopters and pragmatic/late majority)
  6. let deviants get others to adopt new tools / techniques (customers / word of mouth is most effective sales technique)
  7. Track results, keep score (add clear ROI to anecdotes from early adopters)

Sorry if this is too theoretical, but I think it’s more about a mindset or frame of reference you bring to the conversation than a particular script or set of questions.  Here are five related blog posts about early customer interviews:

Lean Startups Panel at SVASE Oct 29 in SF

Add comment October 13th, 2009

I will be taking part in an SVASE panel on “Lean Startups–Do They Really Work” on Thursday October 29 at Cooley Godward in San Francisco. It’s a great panel:

The panel will address these questions and others:

  • What are the characteristics of a lean startup?
  • Will a lean startup business model lead to significantly greater returns for the investor?
  • What is a minimum viable product?
  • How do you define your market?

LOCATION: Cooley Godward Kronish LLP, 101 California Street, 5th Floor, San Francisco, CA 94111

  • 6:00 – 7:00 pm: Networking and hors d’oeuvres
  • 7:00 – 8:15 pm: Panel Discussion and Q&A
  • 8:15 – 8:10 pm: Additional Networking

Rate: Members – $20; Affiliates – $29; General Public – $49; Walk-ins add $10
Register: http://www.acteva.com/booking.cfm?bevaid=187978

Michael Schrage on Innovation, Collaboration, Tools, and Incentives

1 comment June 28th, 2009

The suggestion that you you should “Build a better mousetrap and the world will beat a path to your door,” mis-attributed to Emerson, has destroyed more startups than any other I can think of. It suggests a lone inventor whose product is instantly in demand. Michael Schrage has been studying innovation for more than two decades. What follows are some excerpts from three interviews that outline very different approach to successful innovation, one that stresses collaboration both within the startup (or new product team) and between the startup and its early customers.

Julie Anixter interviewed Michael Schrage on Nov-16-1999 for Tom Peters blog and asked “What or who prepared you for the work you currently do?” (emphasis and links added)

All of this work can really be traced back to when I was the first technology reporter for the Washington Post from l983-l987. I was covering Silicon Valley and Route 128, and doing the standard story about the entrepreneur with the great idea that launched the business.

Then I realized that the basic story pattern was, well, wrong.

I’ve always been interested in innovation…But what I saw—company after company—was that the innovation wasn’t just about creative individuals, but about creative relationships—and particularly collaborative relationships.

And collaborative relationships need shared space (any collaborative medium—cocktail napkin to computer modeling that serves as communication space that two or more people share). After my first book came out, “Shared Minds”, I realized that I had to focus on this … if we care about the future of collaboration we have to care about the future of shared space … there’s a real ecology there. Then prototypes became a fabulous vehicle for interacting within the process of innovation, within a shared space.

When I was a new reporter I was concerned with getting good quotes. Now, when I work with teams and consult, the gap between what people say and what they do is far more interesting. I became much more concerned about behaviors around prototyping, whether it’s designers around the screen or marketers around models; design behaviors take a big shift around prototypes.

Behavior changes matters more than technological change.

Michael Schrage on Innovation in Ubiquity, Volume 5, Issue 39, Dec-8-2004,

When I say “investing in innovation” I mean investing in models, prototypes, and simulations that become platforms for innovating with the invention — the idea itself — and innovating with the actual users and customers for such inventions. It’s not enough to come up with a great idea, you really have to focus on how that idea diffuses throughout the community.

Innovation is not what innovators do but what customers adopt.

For more on this concept see also My Customer, My Co-Innovator

Schrage was interviewed a second time in Ubiquity, Volume 7, Issue 8, in Feb-28-2006

When I wrote “Shared Minds,” my original book on collaboration, I was fascinated by the role that technology can play as a medium for collaboration.  I looked at all of these great collaborations and the role that tools and models and prototypes played in managing their creative collaborative interaction. But what I learned after doing that book and being brought in to do advisory work promoting collaboration within large organizations is that, as important as collaborative tools, techniques and technologies are, you have to have an environment where there are incentives to collaborate.

You have to have an internal economy where there are appropriate rewards and incentives for collaborating, and appropriate disincentives for not collaborating.

Note that a revised version of “Shared Minds” was published in paperback as “No More Teams” in 1995. Schrage’s most recent book, Serious Play, while more than a decade old is still worth reading.

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