Innovation occurs when individuals have a need for
specific products and information. The internet has fostered a greater transference
of information and we now see product innovation growing at a faster pace than
at any point in history. This innovation isn’t always company fostered and can generate
organically from consumers. A study by Takeyasu & Sotaro (2014) helps
support the notion that innovation and consumption are related. In their study
they reviewed 1,000 music users to determine how consumption and innovation are
interrelated.
Innovation comes through companies or through
consumers. The concepts of user generated content and user innovation have made
their way into the field. Users actively engage in the creation process and
further the development of products, concepts, and ideas. The Internet has
raised the communication levels to new heights and allows users to build on
existing products.
In the past, research was primarily focused on the innovation
of individuals and organizations. Greater focus is now on how outside entities
and inter-organizational relations produce innovation (Chesbrough, 2003).
Organizations that work with other organizations and interested parties in the
co-builder process may also experience higher levels of innovative development.
There are generally two ways to use the internet to
gather information for product and service improvement. Innovators first need
the tools which simplifies and assists users in developing products and
services (Franke & von Hippel, 2003). Secondly, they need the feedback from
other users to build knowledge (Mallapragada, et. al, 2012).
Organizations that seek to co-collaborate with
either other organizations or with users need to have the proper platforms that
create ease of use. This ease of use will encourage greater communication
between members. Then they will need the users to actively engage in the
process of sharing knowledge and building off of each others ideas.
The researchers found in their music and innovation
study that those users who consumed music heavily also were more likely to
innovate. In addition, as users interacted heavily with this music they either focused
more on innovation or consumption. The implications of study help organization
decision-makers find ways to allow consumers to become part of the planning and
developing process.
The study lends support to two concepts. Companies
may collaborate using electronic means to build better products for revenue
generation (i.e. projects) or lowering transact costs (i.e. supplier networks).
Companies should consider collaborating with other companies that have like
needs or with consumers who use the products. These users are not passive but
will often be actively engaged in the co-creation process.
Chesbrough, H. (2003). Open
innovation: The new imperative for creating and profiting from technology.
Boston, MA: Harvard Business School Press.
Franke, N., & von Hippel, E.
(2003). Satisfying heterogeneous user needs via innovation toolkits: The case
of Apache security software. Research Policy, 32(7), 1199–1215.
Mallapragada, G., Grewal, R.,
& Lilien G. (2012). User-generated open source products: Founder’s social
capital and time to product release. Management Science, 31(3),
474–492.
Takeyasu, I &
Sotaro, K. (2014). The relationship between innovation and consumption of
Internet Users. Annals of Business
Administrative Science, 13 (1).
