Lead Users

Presentation by : Rushikesh Kulkarni

“Survival of the Fittest" as a synonym for

“Natural selection”Charles Darwin

Introduction

“Innovate or perish ”

Introduction

Know Your Users:

Method to identify unarticulated customer needs include :

•Ethnographic techniques

Observation

Interview

•Lead user

Source: Fuzzy Front End: Effective Methods, Tools, and Techniques Peter A.Koen, Greg M.Ajamian, Scott Boyce, Allen Clamen, Eden Fisher, Stavros Fountoulakis, Albert Johnson, Pushpinder Puri, and Rebecca Seibert

Why User Innovate?

• Heterogeneous needs

• Manufacture looks at only common needs and hence cannot cater to each customer.

• Look for cheaper alternatives

Source: Eric von Hippel Sources of innovation oxford university press 1989

How Many Users Innovate?

What Kind Of Innovation Are Users Capable Of ?

Source: Eric von Hippel Sources of innovation oxford university press 1989

Lead Users

"Lead Users" of a novel or enhanced product, process, or service have beendefined (von Hippel 1986, 1988) as those who display two characteristics withrespect to it:

•They face needs that will be general in a marketplace - but face them months or years before the bulk of that marketplace encounters them

•They expect to benefit significantly by obtaining a solution to those needs.

Lead Users: Example

Space is the ultimate platform for nutritional innovations, in which astronauts are a unique “lead user” for product innovations.

Lead Users: Example

Examples for commercial innovations created by Lead User development

Brake manufacturing companyaerospace companycar racing professionaltrain engineer

Refrigerator companycold storage companyhoteliersMeat and ice-cream exporters

Why Study Lead User ?

• Studies of problem-solving have shown, users who have real-world experience with a need can provide the most accurate data regarding it.

• When needs are evolving rapidly, as is the case in many high technology product categories, only users at the front of the trend will have experience with "tomorrow's needs today.“

• Studies of industrial product and process innovations (Mansfield 1968) show that those who expect a high benefit from a solution to a need tend to experiment with solutions on their own -and so can provide the richest need and solution data to inquiring market researchers

Their present strong needs will become General in a market place months or years in the future

How Can We Study Them ?

How can we find them?

Why would they help us or revel their innovations ?

Lead Users Method

A Lead User market research study involves four major steps, which are spelled out in detail elsewhere (von Hippel 1986,1988; Urban and von Hippel (1988).

Techniques:

Lead Users: Identification of Trends

Identification of trends:

•Delphi

•Trend extrapolation

• Interview with experts (futuristic)

It seems easier to predict future trends for industrial than consumer goods.

Identification of lead users:

• Lead users should be at the leading edge of the trend being studied and should display correlates of high expected benefit from solutions to related needs.

• According to the relevant literature lead users can be identified by databank analyses, surveys or personal interviews. Some online tools for the support of lead user identification have been developed

(e.g. Yenta, IDOL, Xpert-finder) (Springer et al. 2006).

• While in industrial markets pioneers are often well known, it is much more difficult to find lead users in consumer markets.

Eg:

Automotive user looking at new braking system

Might look at car racing, aerospace

Medical imaging

Look to radiologist. Sonographers in early stage tumor detection to semiconductor process to pattern reorganization software

Identification of lead users

Screening from previously identified indicatorscustomer data banks, Customer complaints or Externally produced reports

Lead Users: Identification of lead users

Networking Approach:

This approach involves a small number of customers who are asked if they know of other product users who have new needs or are innovatively active. These kinds of recommendations usually lead very quickly to interesting Lead Users.

Digital imaging: Pattern Reorganization

Lead Users: Development of lead user product concepts

Lead Users: Market Testing

• Score-Tests,

• Mini-Market Tests or

• Test Market Simulations

(Springer et al. 2006).

Users V/S Manufactures: Why Would They Reveal Their Skills And Innovations ?

• There is practically not alternative left with them

• They don’t have time nor they have any motivation to go ahead and commercialize their innovations

Where has the process been used

Medical Products Industry: 3M

Challenge :Increasing hygienic demands, a higher resistance against antibiotics and increasing cost pressures were identified as being relevant factors in the search field.

Method: With help of the “networking approach”, doctors within the target market, working under extreme conditions (e.g. surgeons in developing countries) were selected. users from analogous fields such as microbiologists or make-up artists. They latter aided in the development of materials that can adhere reliably and comfortably to the human skin.

Result: Improved protective coverings, a microbial-treated incisions foil and a radical new approach to individual infection control that allows hygienic measures to be tailored to the specific needs of the patient.

Where has the process been used

IT Industry: Nortel Networks

Challenge:GSM-based tracking systems for different applications.

Method:The trend analysis carried out showed a strong demand for systems that could be used in mobile applications. Lead Users were sought in fields where the position of objects and the transfer of data played significant roles. In this way, contact was made with so-called “storm chasers” who locate and track tornados. Another group consisted of “animal trackers” who often must determine the position of wild animals from a traveling vehicle.

Result : Applications for mobile tracking systems that allow the transfer of multiple forms of data. Included in this, is a concept for the mobile controlling of an “intelligent” house. This system allows, amongst other things, the control of particular appliances in a house as soon as the user leaves the work place (e.g. switching on a heater or pre-heating an oven).

What's Beneficial About Lead Users Innovations

Source: Developing New Product Concepts Via the Lead User Method:A Case Study in a "Low Tech" Field", Cornelius Herstatt* and Eric von Hippel** WP#3249-91-BPS February 1991

• Captures the focus areas fast

• Low cost solution

• These are usually perfect fit to their situations

• Usually commercially attractive

• Manufacturers acting on user needs are often imperfect.

How Is It Different ?

Ethnography tell the present needs / pain point/ Gaps in the existing system

Lead user tell about the problems and opportunities of future

Source: Eric von Hippiel; Democratizing innovation

India and Lead Users:

Other names of lead users innovation in India:

Juggad !

Discussion:

• Lead user method for innovation institutively states that it can be adopted by Companies as a corporate innovation method. How can we adopt the it for consulting projects?

• At what stage in the Contextual Innovation method can this “ lead user concept “ be helpful, and how?

THANK YOU