PDMA Visions Magazine - "Unfuzzing the front-end with web-based idea management"

Technology Spotlight: Unfuzzing the front-end with web-based idea management

By Mark Turrell, President, Imaginatik

Today, more and more companies are using web-based tools to generate ideas in the Fuzzy Front End. Although the jury is out, these popular techniques seem to be broadening and deepening the "idea generation" channel. Mark Turrell gives readers an overview of these tools and discusses different ways companies can use these new web-based tools to gather insights and product concepts. (For an additional perspective on this topic, see Visions article "Research in Progress: Face-to-Face Versus Online Concept Generation" by Ken Kahn, Chris Miller and Matthew Benson, July 2001, Vol. XXV No. 3.)

Many companies struggle to create a pipeline of useable ideas, particularly in their desire to turn the front-end into a predictable process rather than a haphazard series of accidents. But there are problems such as poor quality ideas in the pipeline; few novel ideas; too many duplicates, little diversity of thinking; high expense to capture consumer insight; and the expense of using outside help for brainstorming.

Traditionally the front end of product development has been largely unclarified, an opaque process of invention and creativity, with ideas appearing under the explicit assumption that the vast majority of ideas - like spawning salmon - will not make it upstream.

Over the past 15 years there have been a number of attempts to use computer support to facilitate the idea generation and selection phase of product development. Standalone creativity tools such as Idea Fisher and MindMapper provided single-user tools for individuals to manage their own creativity, using prompts and structures to help the individual come up with novel ideas.

Growth of collaborative tools

In the mid-1990s the use of Group Decision Support Systems (GDSS) or Computer-Supported Collaborative Work (CSSCW) began to address the growing realization that high quality ideas were usually the result of some form of group interaction, and products like GroupSystems and VisionQuest were used to bring collaboration to the creative process, with varying degrees of success.

At the same time enterprise-wide collaboration tools like Lotus Notes and corporate intranets provided a generic toolset that could be tailored to support the process of new product development. Unilever, Procter & Gamble and ABB were amongst the early adopters of these technologies, particularly in applying them to the NPD process. Indeed, one of the most successful systems in place today, Unilever's Innovation Process Management System (IPM) is probably the most comprehensive new product development system still in continuous use.

Idea collection

At the same time, basic websites appeared to support the idea collection phase of new product development. These tools provided a place for employees to submit ideas on a range of topics, from new products through to menu improvements for the company cafeteria. The most basic systems were little more than simple web forms to capture information, with more sophisticated systems providing features such as idea sharing and content searches.

In the past three years there has been an upsurge of interest in providing web-based enhanced support for the idea generation, building and selection phase of NPD. At first the drive came from commercial software vendors, such as my own firm, Imaginatik, and IdeaPilot of Denmark, which saw a market opportunity for this approach. These initial vendors have been as been swiftly followed by other companies who are implementing these - and other - tools. In the past two years, the number of companies implementing idea management and suggestion programs with commercial software has grown from 25 to 75. In the area of NPD, that number has grown from 2 to 25 over the same time period.

GartnerGroup, an analyst firm, predicts that 70 percent of the Type 'A' firms in the Fortune 500 (defined as innovators and industry leaders) will have idea management systems in place company-wide by 2007. According to Gartner, the major reason for the growth is that idea management can yield significant returns in all areas of the business, not just in Research and Development.

Exhibit 1: Event-based Approaches Yield More Usable Ideas

What is "Idea Management?"

• Focus It focuses on ideas that executives are actually interested in.
• Capture It uses a tool for individuals to share their thoughts, typically through a web-based form.
• Building In order to pursue ideas, they need to be expanded, preferably in a collaborative environment.
• Selection Ideas must be sifted through either in a highly formalized way with explicit team members and review criteria, or organic teams based on peer opinions.

Our research has shown that time limited campaigns or events generate four to ten times more high quality ideas than ongoing programs. In addition most ongoing programs either fail or require a major relaunch after two or three years.

What is idea management?

Idea management (IM) is the collection, development, and selection of business ideas that support corporate objectives.

Idea management describes a process, marginally formal or very formal, for the company to solicit quality business ideas from its employees, and in some cases from its customers and suppliers. The process involves the following major stages: Focus, Capture, Building and Selection, as shown in the Box and explained here more thoroughly.

Focus Modern idea management explicitly looks for targeted ideas rather than a broad range of random ideas Our research has shown that time-based campaigns or events result in higher quality yield of ideas and a much greater number of implementable ideas. (This research is shown in Exhibit 1.)

• Capture At the most basic level, there must be some way for individuals to share their thoughts, typically through a web-based form but in some cases, typically manufacturing or logistics, submitting ideas on paper. At a more advanced level, systems can handle the sensitive people issues, like those related to privacy, through tools such as identity control.
• Building In general, the ideas captured at the IM stage are raw or seed ideas. In order to pursue ideas, they need to be expanded. The best approach is a collaborative environment that allows people to both create ideas and build on other people's ideas.
• Selection Companies need a way of sifting through the ideas in a timely way, without a large administrative overhead. Selection processes can be highly formalized with explicit team members and review criteria, or organic teams based on peer opinions.

In the past, most of this process was handled on paper. Today, with the evolution of the Internet and computers, a large portion of the idea generation process can be moved to a hightech format. Nonetheless, there are many variations and options in this Internet-world and techniques are quickly evolving. These techniques may be hard to evaluate, but must have certain capabilities such as:

knowledge management - the reuse of existing knowledge, help to remove duplicates, help find experts;

metrics - tracking the success of the program and individual ideas, which is often critical to justify the benefits to management;

search - tools to find useful ideas;

and integration, sharing data outside the system.

The best ideas may in fact be developed using Word and e-mail rather than a system, and so any idea management system should include some level of external integration of these possibilities.

Web-Based Support

The options for companies that want to use web-based support have been growing rapidly. Of course, one basic option is to create an in-house system. Simple in-house systems may be easier to implement, but they tend to be the hardest to maintain and grow over time. In the past year, these home-grown systems have decreased in popularity, as the leading companies now know what they need in terms of process and application support, and the follower companies learn from the leaders. The process of idea management, as described above, can be quite complex and there are many pitfalls that await unsuspecting companies.

One level above in-house systems are generic collaboration and document management software packages - applications such as Lotus QuickPlace and Akiva's idea-Center. These packages provide generalized functionality for capturing and developing ideas, although they lack workflow processes and evaluation tools.

More sophisticated are the enterprise idea management software packages developed by vendors in the past two or three years. These are integrated toolsets for idea management covering all aspects of the process. Among the popular packages are General Ideas Inc.'s SaveNet, TQS SimNet and my own firm's Idea Central.

Finally, there are the heavy-hitting, all-in-one providers with complete product development lifecycle systems based on a phase gate approach. These long standing products, such as Sopheon's Accolade and IDe's IDweb, provide a wide range of functionality to manage the entire NPD process from ideation through to commercialization. Typically, idea management is implemented as one module in the overall system and not available separately.

Most idea management systems can be installed or hosted. Although hosting has become popular there are always concerns about security that should be addressed through technology, the vendor's reputation, and through legal contracts and procedures.

Companies which have a large number of non-computer users tend to provide access to idea management systems through kiosks in plants; or through paper forms which are then handed back to secretaries or assistants, when completed.

How does it help the fuzzy front-end

The fuzzy front end has been characterized as a mixture of informal, mysterious processes requiring both invention and creativity. Idea management enhances this portion of the new product development process in a number of ways.

For one, it adds some structure to the process. The acts of creation and invention are still based on serendipity, but the dynamic nature of the knowledge generation within a structured context tends to help people more than hinder, especially those not normally associated with the creative process.

It also lets organizations place more importance on idea generation. Many organizations still believe that the process does not require any systematic support, and yet the research indicates that some form of structure yields significant benefits over an informal process. Often the people who urge an informal process are close to the decision makers anyway, and therefore do not need to have a channel for their feedback. It is those people without a voice who often have the best ideas, and who benefit most from a focused process.

In addition, idea management can be an inexpensive method of netting ideas and insights from all employees. These are people close to the company's customers, suppliers and partners. These employees have an experience base within and outside the firm itself. They are exposed to a wide range of stimuli in their daily life, from their families to their daily commute to work. Although employees are paid to work, it is often forgotten that they will willingly think for free. They become a cheap source of insight, one that can be rapidly tapped into on a case-by-case basis.

Overall, web-based idea management brings greater diversity in the idea pool for companies. All too often ideation is left to the same group of people - those who may be hidebound in the standard ways of doing things. Opening up ideation to a broad audience increases the likelihood that someone will have a winning, novel, out-of-the box idea that makes a difference. Some companies have gone one step further. W. R. Grace, a construction chemicals company, has an informal group called the 'Crazies' who are invited to every virtual ideation session to bring their particular brand of creative thinking to any business problem.

Web-based ideation also makes more effective use of outside expertise. Idea management is complementary to other tools and techniques, rather than a replacement. The company-wide process can create a first pass collection of ideas, which can be further developed in face-to-face meetings, and validated through market research. Consumer product companies are reporting success in using the results of ethnographic studies as a springboard for ideas on how to address the uncovered consumer insights.

For example, Mott's Inc., a $1bn subsidiary of Cadbury-Schweppes, has used our Idea Central to provide a pipeline of new product ideas, plus sales and marketing ideas. In the nine months from launch in December 2001 they generated 6,000 ideas around 25 focused topics. Over 100 of these ideas have moved to further development stages, many of which will reach the market in 2003. Exhibit 2 shows a prototype for a typical IM event.

Exhibit 2: Prototype Design for a Typical Idea Management Event in NPD

Prototype Design for a Typical Idea Management Event in NPD

• Type of company: Consumer product
• Internal project sponsor: Brand Manager, VP Marketing / R&D
• Topics: Consumer insight, new market introduction, brand/product stretch, trend analysis
• Audience: 100 to 1,000 invited participants from a range of business functions and locations
• Event duration: 4 weeks
• Venue: Web-based
• Participation Rate: 25% - 40% of invited participants make a substantive contribution
• Number of Ideas: 50 - 200 ideas generated
• Yield of Quality Ideas: 2.5% - 5% ideas used
• Typical results: New concepts for consumer testing, feed stage gate with new projects, develop novel, insightful new products

Source: Imaginatik Research

Idea Central let the company open up idea generation to 1,700 employees company-wide, instead of a narrow group in marketing. The company found that the employee base frequently provides more diverse ideas than the use of traditional marketing agencies, and at a substantially lower cost and in a faster timeframe.

What are the issues involved

It is clear from research into phase gate systems that software is only part of the solution. Companies need to consider human factors, such as individual motivation to be involved, management factors, such as perceived loss of control, and hard dollar cost considerations, such as the cost of the system and the people cost of change management.

Companies embarking on idea management need to consider the following issues before going forward. First, they need management support. The sponsor of this program needs authority to collect ideas from staff, and management sponsorship of events to ensure that someone does something with the top ideas Secondly, the new ideation system must be marketed internally. Companies need to inform people that the system exists, and how it should be used. The most successful techniques involve e-mail and occasionally company-wide voice mails.

Many companies provide incentives to encourage employees to participate. A good rewards and recognition program balances individual motivation, company policy, and reduces the risk of cheating. Research by Alfie Kohn ( Punished by Rewards, Houghton Mifflin Co., 1999) shows that intrinsic motivations work better than tangible rewards. However companies need a process that works well for them, and does not have any unintended negative consequences.

It is never easy to get high quality ideas, and idea management is no exception. Perhaps the best way to set expectations is to keep in mind the old saying: "To find a princess, you have to kiss a lot of frogs." There are ways to extract more novel ideas, and Imaginatik Research has been working on 'perspective change' as the basis for more radical innovation, through consumer insight events as opposed to the more classic idea gathering events.

Companies collect a lot of ideas, but they lack the time to evaluate them. So people get annoyed and stop using the system. In this case the company is killed by success. One of the most frequent reasons is that companies under-estimate the amount of support required to manage the process.

The Benefits

There are many benefits as a result of a successful web-based idea management program. The likelihood of creative solutions is increased through the diversity of a large pool of contributors, who have open access through a corporate intranet. The software tools can reduce the administrative overhead of the program through extensive workflow support. The focus on targeted events yields more high impact ideas that can be immediately productive, as consumer insights or complete product concepts. And companies can make better use of outside experts to work on the concept development phase rather than the pure brainstorm phase. As part of the fuzzy front end, idea management creates the ability for companies to increase the idea flow at the start of the pipeline, and that in turn improves the yield at the end of the pipeline.

In addition to the direct benefits in the fuzzy front end, the same technology and process can be used to support other corporate objectives, such as cost reduction, process improvement, and speeding up product launch and commercialization. Indeed, some of the biggest successes of idea management have come from sales and marketing for new products. Recently, InformationWeek reported that Bristol-Myers Squibb generated millions of dollars in new revenue from sales people's ideas to speed up product launch - a far cry from the normal investment focus on pure R&D.

What should companies do if they are interested?

The best approach to become acquainted with the new methods of managing the fuzzy front end, draws on the best practice of innovation itself: run a focused trial, measure the return, plan for the future.

Companies should be prepared to pilot an approach to see if it fits their culture, and to validate management's real commitment to innovate and support the NPD process.

Yielding new insights

Web-based idea management offers tremendous scope to improve the yield from the fuzzy front end, and to provide much needed structure to make the fuzzy front end a little less fuzzy. Idea management is fundamentally a human process and there is a limit to how much the technology can do without proper management support and a range of activities for internal promotion.

The leading companies are already seeing benefits from their use of these systems, and it is likely that this will grow significantly over the coming years. In these turbulent times, companies would be wise to consider tapping into their employees for new product ideas and insights - after all they know your products, they work with your customers, and they like working for the company.

Mark Turrell is the Director of Imaginatik Research, CEO of Imaginatik, and a Research Fellow at Penn State Smeal College of Business.

Copyright 2003 Product Development and Management Association.