Both social media and innovation are commonly used terms with confusing meanings. In this post, I’ll first define each, suggest three ways to use social media to stimulate innovation and finish by asking for your help.
Social Media – are online tools that allow for global collaboration and communication. This communication takes the form of social objects (videos, articles, photos, maps, calculators, graphics) which are (co)created and shared by people across social networks (Facebook, LinkedIn, Pinterest, Slideshare, forums).
Innovation authority and Harvard Business Professor Clayton Christensen defined three types of innovation in a recent New York Times article. In this article, Clayton describes innovation in three parts:
Empowering Innovations – Create new revenue. These new offers, products or services are like floods, they transform the landscape of the marketplace. These new purple cows serve new market needs and need more people to make, distribute, sell and service the new offer. Virgin Galactic suborbital space flights fit this profile because they have transformed space travel. For a cool $250,000 ‘anyone’ can travel to space.
Sustaining Innovations – Preserve revenue. They are the most common type of innovation that replaces old products with new models. Every year car manufacturers come out with a new product line to replace the old. The new and improved models are often distinct from the last year’s version but the car still serves the same market need. A new F150 model doesn’t create new revenue. It replaces the old.
Efficiency Innovations – Free up revenue. These are the Walmart type of innovations that reduce the use of resources like time, people and money. Companies in the race to the bottom and towards the end of their product lifecycle spend a lot of time with these kinds of innovations. Efficiency innovations create the highest customer value for the lowest cost to the company.
How can social media help you introduce something new with your business?
Start with efficiency innovations.
Take a fresh look at all of your processes and ask yourself where your employees are losing time and money. How might a digital community help reduce your customer service labour costs? How might your sales team benefit from more efficient lead generation methods?
As an example, lets look at cold calling for lead generation. Cold calling is a repetitive action that takes a significant amount of a sales persons time and effort. It’s a process that doesn’t scale well. Each sales person needs to be on the phone to generate leads.
With social media, you can use any number of proven techniques (like growth hacking) or platforms (like Hubspot) to make the process of lead generation, nurturing and retention scalable and efficient. By freeing a sales reps time normally allotted to cold calling, you can ask them to reinvest that time into thinking of sustaining or empowering innovations that will help fuel growth for your company in the years to come.
Move on to sustaining innovations.
Understanding and empathizing with your customers is key to successfully replacing an old offer with a new one. Companies like IBM, Fiskars, Dell and Starbucks all use online forums and social media platforms to harness the wisdom of the crowd. Each company hosts a space to allow people to comment on the good and bad of their existing products.
Fiat Brazil used crowds to help design the 2009 Fiat Mio concept car. The Fiat Mio design team received over 10,000 suggestions on their website from people in over 160 countries. The team searched through all of them to discover new ways to serve consumers with the design of the vehicle.
How might your team use crowds of people and digital communication for fast and cheap feedback on prototypes?
Finally empowering innovations
Steve Jobs was famous for not asking customers what they wanted. As legend has it, Jobs just knew what customers wanted. He knew that consumers wanted to put 1,000 songs in their pocket. However, I suspect Jobs’ skill was less about knowing and more about seeing. Jobs could see the opportunity for a better way to listen to music by imagining millions of people with hundreds of CDs on wall cases and limited music portability. Jobs gift was the ability to see and articulate the conversations of the marketplace.
“Markets are conversations” is the first thesis of an important business book called The ClueTrain Manifesto. Every day, millions of people go online to post questions and asking for recommendations of their digital networks. These conversations are the market. Even if you’ve never read the book, you’ll appreciate that entrepreneurial employees often see opportunity in the market through conversations on the front line.
On the front line, employee entrepreneurs are exposed to, and sensitive of, small shifts in consumer demand. In a large organization, these people are important because they can signal warnings of bigger shifts to come. When properly trained to notice the right opportunities and empowered to do something about them, these “canaries in the coal mine” can fuel sustainable growth. Companies like Google, Semco, Atlassian, 3M, Patagonia and Gore-Tex have been very profitable by supporting entrepreneurial cultures.
Next time you’re on Twitter, Facebook, Google+ or LinkedIn search for the conversations around your industry. Can you spot any opportunities?
In addition to these “old” social media networks, there are new social platforms emerging to help companies discover and act on empowering innovations. The Pentacle virtual business school uses a proprietary platform called QUBE to help dispersed leadership teams learn and build strategy around these kind of opportunities quickly. (Full disclosure – I’m a trained facilitator on this platform and think it’s an amazing new social media platform). Its social media tools like these that offer hope for finding new revenue streams and sustainable growth through innovation.
Are there other ways you have used or can think of using social media for innovation?
Which companies do you think are using social media to innovate?