Frank T. Piller

Toolkits for Idea Competitions: A Novel Method to Integrate Users in New Product Development

Research has shown that many innovations originate not in the manufacturer but the user domain. Internet-based toolkits for idea competitions (TIC) are a novel way for manufacturers to access innovative ideas and solutions from users. Idea competitions build on the nature of competition as a means to encourage users to participate at an open innovation process, to inspire their creativity, and to increase the quality of the submissions. When the contest ends, submissions are evaluated by an expert panel. Users whose submissions score highest receive an award from the manufacturer, which is often granted in exchange for the right to exploit the solution in its domain. Following the idea of evolutionary prototyping, we developed a TIC in cooperation with a manufacturer of sports goods. The TIC was launched as a pilot in one of the companys markets. Submissions were evaluated using the consensual assessment technique. The evaluation of this study provides suggestions for further research, but also implications for managers willing to explore TIC in their organization.

Does mass customization pay? An economic approach to evaluate customer integration

The paper provides an integrated view of value creation in mass customization-based production models. While flexible manufacturing technologies are often seen as the main enabler of mass customization, we argue that modern information technologies play a similar important role. Their significance is based on enabling a distinctive principle of mass customization efficiently: customer integration into the production processes. The customer is integrated into value creation during the course of configuration, product specification and co-design. Customer integration is often seen as a necessity and source of additional costs of customization. However, we argue in this paper that customer integration may also be an important asset to increase efficiency and could pave the way for a new set of cost-saving potentials. We coin the term ‘economies of integration’ to sum up these saving potentials. Economies of integration arise from three sources: (1) from postponing some activities until an order is placed, (2) from more precise information about market demands and (3) from the ability to increase loyalty by directly interacting with each customer. By examining and structuring the economic principles of mass customization the paper will give insights into the benefits, but also the constraints of a mass customization strategy.

The Customer Centric Enterprise

More than two decades later, in 2003, this prophecy is still a vision not only in the clothing business but also in most other industries. What causes the renowned futurist miss the mark? Though we have most, if not all, the necessary hardware, software, powerful computing and communication systems, including laser cutting, high performance sewing etc, we are still not really able to meet the special yearning of human beings, that very important feature that sets us apart from animals, i.e. creativity. We believe the missing gap is the capacity to put the systems, including organization, process and business models together and make them customer centric. Building a customer centric enterprise that places the demands and wishes of each single customer in the center of value creation implies much more than investing in advanced technologies. Firms have to build not organizations and structures to produce customized services, but organizations and structures for customers. With the customers at the center, human beings can then focus on being creative and be isolated from mundane tasks in order to concentrate on expressing themselves more freely.

Overcoming Mass Confusion: Collaborative Customer Co-Design in Online Communities

The idea of integrating users into a co-design process as part of a mass customization strategy is a promising approach for companies being forced to react to the growing individualization of demand. Compared to the rather huge amount of literature on manufacturing and information systems for mass customization, only little research discusses the role of the customer within the co-design process. Customers face new uncertainties and risks, coined “mass confusion” in this paper, when acting as co-designers. Building on a construction strategy of empirical management research in the form of six case studies, we propose the use of online communities for collaborative customer co-design in order to reduce the mass confusion phenomenon. In doing so, the paper challenges the assumption made by most mass customization researchers that offering customized products requires an individual (one-to-one) relationship between customer and supplier. The objective of the paper is to build and explore the idea of communities for customer co-design and transfer established knowledge on community support to this new area of application.

The open innovation research landscape: Established perspectives and emerging themes across different levels of analysis

Abstract This paper provides an overview of the main perspectives and themes emerging in research on open innovation (OI). The paper is the result of a collaborative process among several OI scholars – having a common basis in the recurrent Professional Development Workshop on ‘Researching Open Innovation’ at the Annual Meeting of the Academy of Management. In this paper, we present opportunities for future research on OI, organised at different levels of analysis. We discuss some of the contingencies at these different levels, and argue that future research needs to study OI – originally an organisational-level phenomenon – across multiple levels of analysis. While our integrative framework allows comparing, contrasting and integrating various perspectives at different levels of analysis, further theorising will be needed to advance OI research. On this basis, we propose some new research categories as well as questions for future research – particularly those that span across research domains that have so far developed in isolation.

A Typology of Customer Co-Creation in the Innovation Process

Customer co-creation denotes an active, creative and social collaboration process between producers (retailers) and customers (users), facilitated by the company. Customers become active participants in an open innovation process of a firm and take part in the development of new products or services. In this paper, we provide a review of the evolution of customer co-creation and related forms of customer participation and suggest a typology of recent methods of co-creation (open innovation with customers). Our typology is based on three dimensions, addressing (i) the customers’ autonomy in the process, (ii) the nature of the firm-customer collaboration (dyadic versus community based), and (iii) the stage of the innovation process when the customer integration takes place. Along these dimensions, we then present specific methods of customer co-creation. We conclude with a number of suggestions for further research.

Core Capabilities of Sustainable Mass Customization

The goal of mass customization is to efficiently provide customers with what they want, when they want it, at an affordable price. Realizing this promise demands from the perspective of process design the integration of customers into the value chain of the manufacturer. Here, configuration processes play a crucial role to manage this task by providing customers support and navigation in co-designing their individual product or service. But this capability of “choice navigation,” enabled by modern configuration systems, is just one of three strategic capabilities of mass customization. This chapter explains why configuration systems are playing a crucial role in meeting the particular demands of each individual customer and addresses the fundamental capabilities of sustainable mass customization: solution space development, the design of robust processes, and choice navigation.

Open Business Models and Closed-Loop Value Chains: Redefining the Firm-Consumer Relationship

Driven by recent socio-economic developments, manufacturing firms increasingly adapt their business models along two dimensions. Apart from vertically integrating the entire product life cycle, traditionally separated tasks are re-allocated into new forms of horizontal stakeholder collaborations. Incorporating these two dimensions, this article develops a framework of nine business model archetypes that holistically capture the increasing openness of business models towards consumers in the emerging closed-loop value chain. Using illustrative examples, it demonstrates their broad applicability in different industries and derives important managerial implications for firm-consumer relationships, the relevance of consumer communities, new product development activities, and the sustainability of business models.

Business Models with Additive Manufacturing—Opportunities and Challenges from the Perspective of Economics and Management

Technological innovation has frequently been shown to systematically change market structure and value creation. Additive manufacturing (AM), or, colloquially 3D printing, is such a disruptive technology (Berman 2012; Vance 2012). Economic analysis of AM still is scarce and has predominantly focused on production cost or other firm level aspects (e.g., Mellor et al. 2014; Petrovic et al. 2011; Ruffo and Hague 2007), but has neglected the study of AM on value creation and market structure. In this paper, we want to discuss the economic effects of AM on the locus of innovation and production. This is why we first review some current business models that successfully use AM as a source of value creation. Being a potential disruptive influence on market structures, we then discuss how AM may enable a more local production by users, supplementing the recent development of an upcoming infrastructure for innovating users and “Makers”.

New Directions for Mass Customization

In the closing chapter of this book we would like to share with our readers our view about the future of the customer centric enterprise and the enabling strategies of mass customization, customer integration, and personalization. We will also comment on fields for further research necessary for the development of new processes, tools and programs for integrating the customer into value creating activities, both on the technological and the operational process side. We identify six areas where - from our perspective and within our field of knowledge - more research is needed most. These are also fields which we think require special attention when implementing a mass customization system: (1) Issues concerning the design of products and product architectures. (2) Consumer behavior with customer interaction tools. (3) Drivers of customer satisfaction and dissatisfaction with custom made products. (4) Impact of integrating a user and customer into value creation on knowledge management and information management. (5) Capability analysis and systems engineering for concurrency in value chains. (6) Measurement of value contribution in mass customization systems.