Democratizing Innovation: (The MIT Press)

The process of user-centered innovation- how it can benefit both users and manufacturers and how its emergence will bring changes in business models and in public policy.Innovation is rapidly becoming democratized. Users, aided by improvements in computer and communications technology, increasingly can develop their own new products and services. These innovating users-both individuals and firms-often freely share their innovations with others, creating user-innovation communities and a rich intellectual commons. In Democratizing Innovation, Eric von Hippel looks closely at this emerging system of user-centered innovation. He explains why and when users find it profitable to develop new products and services for themselves, and why it often pays users to reveal their innovations freely for the use of all.The trend toward democratized innovation can be seen in software and information products-most notably in the free and open-source software movement-but also in physical products. Von Hippel's many examples of user innovation in action range from surgical equipment to surfboards to software security features. He shows that product and service development is concentrated among "lead users," who are ahead on marketplace trends and whose innovations are often commercially attractive. Von Hippel argues that manufacturers should redesign their innovation processes and that they should systematically seek out innovations developed by users. He points to businesses-the custom semiconductor industry is one example-that have learned to assist user-innovators by providing them with toolkits for developing new products. User innovation has a positive impact on social welfare, and von Hippel proposes that government policies, including R&D subsidies and tax credits, should be realigned to eliminate biases against it. The goal of a democratized user-centered innovation system, says von Hippel, is well worth striving for. An electronic version of this book is available under a Creative Commons license.

About the Author :
Eric von Hippel, the T. Wilson (1953) Professor of Technological Innovation at the MIT Sloan School of Management, is a leading research scholar on the economics and management of free, open, and distributed innovation.

Review :

In a concise 200 pages, von Hippel traces the empirical studies on user innovation, determining that between 10 and 40 percent of users engage in developing or modifying products. These 'lead users' are ahead of the curve and often create improvements that other users will want to share.

Still, new patterns are emerging in some scattered yet suggestive areas of product design, studied by management expert, Eric von Hippel in Democratizing Innovation. 'Lead users' (the most zealous windsurfers who get new boards first and modify them, the most advanced builders experimenting with new materials like stressed-skin panels) often suggest or even create useful innovations that manufacturers adopt.

The book puts its thesis well, with plenty of examples.

The fruits of his labor are nicely summarized in Democratizing Innovation, a useful primer on what he calls 'user-centered innovation.'...Despite its brevity, Democratizing Innovation is a heavyweight book, written with the lightness of touch you might expect from a regular contributor to the journal Management Science. But where innovation comes from and how value gets created are heavy questions for all companies in all industries. No innovation means no value added, and ultimately no profits.

This is a book that should be required reading for every person in every automotive company who is involved in product development, be they marketers or engineers, manufacturers or managers. It is that important.

von Hippel has brought an important issue to the fore.

Von Hippel presents a persuasive case for the benefits of encouraging lead users to innovate and a truly intriguing look at what they've contributed to the world so far.

[von Hippel's] book looks at why users want customized products, why it is more advantageous for them rather than the manufacturer to make the changes, why they freely share their innovations with other, and the need for government to encourage user innovaton by refining patent and intellectual protection legislation. It's a fascinating, little explored trend that he covers thoroughly. Although his book is written in academic style, it offers lots of examples and provides an understanding of an important innovation in the world of innovation.

[von Hippel] shows that, in fields ranging from surgical instruments and software to kite surfing, customers often come up with new products of new ways of using old ones. Some companies encourage their customers to modify their merchandise. Others, however, do not: when a devoted user of Aibo, Sony's robot dog, wrote applicatons that would allow the Aibo to dance to music, Sony threatened the man with a lawsuit.