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The Lead Useridea generation metho

Professor Eric von Hippe

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The Lead Useridea generation method


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Contrasting innovation methods

Traditional methods a

find a need and(Target users provid

New methods are based on

finding / encouragingand commercializing solutions

Need and market life cycle curve

Targetusers

Lead users

Contrasting innovation methods

T


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Essential Definitions

1. An INNOVATION is anything new that

used (enters the marketplace) wheor minor.

2. The functional source of innovation dependfunctionalrelationship between innovator and

An innovation is a USER innovation whenexpects to benefit by using it;


1. An INNOVATION is anything new that

used (enters the marketplace) wheor minor.

2. The functional source of innovation dependfunctionalrelationship between innovator and

An innovation is a USER innovation whenexpects to benefit by using it;


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Many industrial and consumer productroots in user innovation.

Consumer product examples:

Category Example

Health Products Gatorade

Personal Care Protein-base ShampooFeminine Hygiene

Sports Equipment Mountain BikeMountain Climbing-Piton

Apparel Sports Bra

Food Chocolate MilkGraham Cracker Crust

Many industrial and consumer productroots in user innovation.

Category Example

Health Products Gatorade

Personal Care Protein-base ShampooFeminine Hygiene

Sports Equipment Mountain BikeMountain Climbing-Piton

Apparel Sports Bra

Food Chocolate MilkGraham Cracker Crust


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Users innovate when it pays for th

Only Lead User innovations form the bas

products and services of value to manufac

Lead Users are users that:

1. Have needs that foreshadow general demmarketplace;

2. Expect to obtain high benefitfrom a soluti

needs. (Such users are more likely to innN it i th th f i ti !)

Users innovate when it pays for th

Only Lead User innovations form the bas

products and services of value to manufac

Lead Users are users that:

1. Have needs that foreshadow general demmarketplace;

2. Expect to obtain high benefitfrom a soluti

needs. (Such users are more likely to innN it i th th f i ti !)


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Lead users at leading edge of needLead users at leading edge of need


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The World Wide Web

A Lead User Innovation

Berners-Lee did not set out to invent a conte

cultural phenomenon; rather, he says, it wasI needed in my work. He wanted to simply toproblem that was hindering his efforts as a co

software engineer at CERN.Berners-Lees innovation was to apply hypertgrowing reality of networked computers. He e

the idea he had developed at CERN and madavailable on the Internet in the summer of 199

The World Wide Web

A Lead User Innovation

Berners-Lee did not set out to invent a conte

cultural phenomenon; rather, he says, it wasI needed in my work. He wanted to simply toproblem that was hindering his efforts as a cosoftware engineer at CERN.

Berners-Lees innovation was to apply hypertgrowing reality of networked computers. He e

the idea he had developed at CERN and madavailable on the Internet in the summer of 199


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Adopter CategorizationAdopter Categorization

According to InnovativenesAccording to Innovativenes


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Product area selected for pilot test oProduct area selected for pilot test o

user methods:user methods:

Computer-Aided-Design system

Used to lay out printed circuit boards (P


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In PC-CAD Lead Users were innovRoutine Users were not

Expected LeadExpected LeadUser AttributeUser Attribute

Type of Questions WeType of Questions WeAskedAsked

LELEUsUs

At Front ofAt Front ofHigh DensityHigh DensityTrend?Trend?

What are your:What are your:

zz Avg. Number of layers?Avg. Number of layers?

zz Avg. Line width (mils)?Avg. Line width (mils)?

(1988 data)(1988 data)

66

11

High Need ForHigh Need ForImprovedImprovedSystem?System?

Are you satisfied with yourAre you satisfied with yourpresent PCB CAD system?present PCB CAD system?

NN

Active InActive InSolving OwnSolving Own

Did you build own PCBDid you build own PCBCAD SystemCAD System

8282YeYe

In PC-CAD Lead Users were innovRoutine Users were not


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Consum er produc t innovat ors are lead usSports equipment userSports equipment user

CharacteristicsCharacteristicsInnovatorsInnovators NonNon--

innovatoinnovato

Lead User Characteristic (1):Lead User Characteristic (1):

Being Ahead of the TrendBeing Ahead of the Trend**

I improved or developed new techniquesI improved or developed new techniques

in my sport.in my sport.

4.294.29 5.845.84

Lead User Characteristic (2):Lead User Characteristic (2):

High Benefit from InnovationHigh Benefit from Innovation**

I have new needs which are not satisfiedI have new needs which are not satisfiedby existing products.by existing products.

3.273.27 4.384.38

I am dissatisfied with the existingI am dissatisfied with the existingequipment.equipment.

3.903.90 5.135.13


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Many lead users innovat eIndust r ia l p roduc t s n % innovaPr in t ed Ci rc u i t CAD 136 24.3%Pipe Hanger Hardw are 74 36%Library IT Syst ems 102 26%Sof tw are sec ur i t y fea tures 131 19.1%Surgic al Equipm ent 262 22%Consumer products

Out door Product s 153 9.8%

A i LU h i iA i t LU h t i ti


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As innovator LU characteristics go uAs innovator LU characteristics go u

does innovation attractivenessdoes innovation attractiveness


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Performance AssessmentPerformance Assessment

of Lead User Research at 3Mof Lead User Research at 3M

Research Team:Research Team: Prof. Gary Lilien, Penn State UniveProf. Gary Lilien, Penn State Univer

Prof. Pam Morrison, University of New South Wales; DProf. Pam Morrison, University of New South Wales; D

ASI Associates, Mary Sonnack, Division Scientist, 3MASI Associates, Mary Sonnack, Division Scientist, 3M;Prof. Eric von Hippel, MITProf. Eric von Hippel, MIT

(For the complete article and other Lead User Videos(For the complete article and other Lead User Videos

Go toGo to leaduser.comleaduser.com on the Web)on the Web)

A t R lt L d U N LAssessment Results Lead User vs Non Le


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Assessment Results: Lead User vs. Non-LeFunded Ideas

LU Ideas (n=5) NON-LU Id

(n=42)Newness of Idea

z Novelty compared tocompetition

z

Newness of needs addressed

9.6

8.3

6.8

5.3

Projected Profitability

z % market share in year 5

z Estimated sales in year 5

68%

$146m

33%

18m

Strategic Value

z Strategic importance

z Fit with Strategic plan

9.6

9.8

7.3

8.4

Fit with Business

Assessment Results: Lead User vs. Non-LeFunded Ideas

LU Ideas (n=5) NON-LU Id

(n=42)Newness of Idea

z Novelty compared tocompetition

z

Newness of needs addressed

9.6

8.3

6.8

5.3

Projected Profitability

z % market share in year 5

z Estimated sales in year 5

68%

$146m

33%

18m

Strategic Value

z Strategic importance

z Fit with Strategic plan

9.6

9.8

7.3

8.4

Fit with Business


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Breakthrough:

z

Determines Future Business Growth and Marginsz Major Product line >20% of Division Sales

Incremental improvement:

z Valuable to existing business

z Extension to existing lineIncrem

Traditional 3MMethod

41


Breakthrough:

z

Determines Future Business Growth and Marginsz Major Product line >20% of Division Sales

Incremental improvement:

z Valuable to existing business

z Extension to existing lineIncrem

Traditional 3MMethod

41


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Example of a LU innovation on 3M web

3M's Major Innovations

Commercialized 2001

z 3M Inflata-Pak Air Cushion Packaging

packaging eliminates the need for peanutswrap while protecting fragile items for shippof tough, durable plastic, it conforms to odd

and seals itself.

Example of a LU innovation on 3M web

3M's Major Innovations

Commercialized 2001

z 3M Inflata-Pak Air Cushion Packaging

packaging eliminates the need for peanutswrap while protecting fragile items for shippof tough, durable plastic, it conforms to odd

and seals itself.


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Lead User concept generation projects

cost more than traditional ones

Person DaysTraditional 3Mconcept developmentstage

60

Lead User conceptdevelopment stage

At 3M

154

(pl

Lead User concept generation projects

cost more than traditional ones

Person Days

Traditional 3Mconcept developmentstage

60

Lead User conceptdevelopment stage

At 3M

154

(pl


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ACTIVITY: Think about possible Lead U

yourmarkets

Step 1Step 1 Select a specific market & specificSelect a specific market & specific majormajor

aboutabout

Step 2Step 2 Brainstorm possible lead usersBrainstorm possible lead users withinwithinthth

marketmarket

zz Which types of individuals or firms have nWhich types of individuals or firms have n

leading edge of the trends?leading edge of the trends?zz Which ones have a high incentive & the rWhich ones have a high incentive & the re

solve their leading edge needs?solve their leading edge needs?

Step 3Step 3 Brainstorm possible lead usersBrainstorm possible lead users outsideoutside tt

ACTIVITY: Think about possible Lead U

yourmarkets


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Example of searching for lead users ou

target market

Look for users facing higherneeds than anyone in targetmarket:

People who need even highresolution than anyone doingmedical imaging

Examples:

Experts in semiconducimaging

Medical X-Ray

Instead of a board of leading radiol

Example of searching for lead users ou

target market

Look for users facing higherneeds than anyone in targetmarket:

People who need even highresolution than anyone doingmedical imaging

Examples:

Experts in semiconducimaging

O


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All Users Testing

Sales

Need Data

Market Research R&D

Manufacturer

Technical

Service

Sales

Need Data

Need Data

Service

Solution Data

Solution Data

Solution Data

Organizing to use the LU Method

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