What new technologies, processes or business models can help consumers use energy more wisely and improve our energy balance?
—GE Ecomagination
Tricorder Prize
—X Prize Medical Device Challenge
Make paper cups disappear.
—Starbucks Betacup Challenge
Show Triple Eight how their next snowboard helmet should look.
—Triple Eight Challenge
Make your dreams comes true.
—LEGO Cuusoo New Product Idea Request
Submit a business plan.
—Sequoia Capital New Business Idea Request
Design a jewel box of an ultra-low-footprint apartment in 420 square feet (~39 square meters).
—LifeEdited Design Challenge1
“It could just fold up and fit in your pocket,” explained Toby Daniels, as he sketched the outline of his idea for a folding cup. Toby was trying to solve a problem. Based on his research, he had determined that reusable coffee cups were inconvenient, but necessary. If instead, more people elected to reuse coffee cups, we would not need to throw away billions of paper cups each year.
So began a long discussion about our paper coffee cup problem—it was the genesis of framing the call to action for the Starbucks Betacup challenge. Eventually, the Crowdstorm authors and a large group of advisers, idea contributors, voters, media outlets, and Starbucks joined Toby.
Our first conversation and problem framing evolved to explore all the other ways in which we might reduce paper cup use, initially by focusing on reuse. As we discussed possible solutions, we began to understand that we were not only looking for a collapsible cup. We might want to encourage new product or service or communication design. We needed to find a way to frame the question to allow for a broad range of responses and to explore a variety of possibilities.
We arrived at this conclusion by considering a number of very rough questions and possible answers. We did this by looking at the problem from multiple perspectives.
We introduced the Business Model Canvas2 in Chapter 1 to explore the potential impacts of crowdstorm processes on business models. Tools like the Business Model Canvas help us to revisit and test key business assumptions and, in doing so, often reveal new questions and gaps that might yield a broad variety of interesting responses from outside talent.
For example, we can use the Business Model Canvas to review how reducing paper cup use might be addressed via changes to Key Partners, Key Activities, Key Resources, Value Creation, Customer Relationship, Channels, and Customer Segments. This can help to expand our question to include changes to areas that might ultimately impact the problem at hand—reducing paper cup waste—but also the impact on behavior, revenues, and costs.
Figure 3.1 Business Model Canvas—Understanding the Potential Impact of New Ideas from the Betacup Challenge
Source: Alexander Osterwalder and Yves Pigneur, Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers (Hoboken, NJ: John Wiley & Sons, 2010).
As we discussed the Betacup challenge, we understood that Starbucks was already working with Key Partners via another initiative at MIT called the Cup Summit. Since 2009, the Cup Summit has led to a number of recycling initiatives, as well as a proof of concept showing how paper cup material can be recycled into new cups. Based on this effort, it seemed clear that there might be room for more options (that is, asking people to reuse cups versus throwing them away). But there also seemed to be an opportunity to invite customers to take part in the process.
Beyond this, we began to understand that there were a number of ways to approach the issue of making paper cups disappear. For example, some channels might allow participants to approach the issue with different communication ideas. Or customers might take on different roles as partners and give them specific tasks to help with recycling or reuse. Thinking about the overall value proposition opened the possibility to change behavior and make it easier to reuse cups (the very genesis of Toby’s collapsible cup idea).
Considering these various approaches helped to expand the range of possible answers—from a problem of how to make a collapsible cup to a more broadly defined problem of how to eliminate paper cups. And this changed the call to action.
In Chapter 1, we also saw how GE’s Ecomagination challenge expressly asked for technologies, processes, and business models that covered a broad swath of possible approaches to sustainable energy. GE broke the problem down in order to focus on different partners’ roles—for example, generation and distribution of electricity. But they also asked for solutions that focused on rethinking relationships with customers.
The Ecomagination and Betacup challenges are examples of framing problems to explore more approaches across the Business Model Canvas. Triple Eight’s desired outcome initially appeared to be related to a very specific goal: to create different graphic designs as a way to distinguish skating and snowboard helmets. In fact, what Triple Eight’s CEO was seeking was an entirely new interpretation of the Triple Eight brand—one that set it apart by adding something beyond the all-important, but industry standard, message of safety and comfort.
The company believed that this approach would yield promising results because there were likely groups of people who loved to skate who were also designers. The winner turned out to be a skater—more specifically, a derby girl.
The Business Model Canvas is one effective way to ask what areas of your business might benefit from more ideas and help open the range of solutions your participants can consider.
It is the first step in inspiring external talent to engage in the crowdstorming process.
Once we have a good feel for the breadth of the question, the next step is to determine the maturity of response you are looking for: Do you want a finished product or are you just seeking the kernel idea that will require additional investment to make it ready for production? Starbucks knew that they were looking for “the art of the possible”—and were therefore open to investing additional time and resources to make the ideas happen. The people running GE Ecomagination were interested in investing or partnering, and were therefore seeking ideas that had moved into some phase of production—for example, a prototype, or a business that already had some customers.
One way to understand this continuum is to look at people who invest in ideas all the time—specifically, venture capital firms. Every day these groups review ideas and make decisions about what to fund. They are ultimately looking for a return on the money they invest, so their ideal opportunities can come in a range of states—from very early and promising teams and ideas that do not require very much capital but have much to prove, to later stage and more mature businesses that require much more capital (but also have a lower risk of failing).
Sequoia Capital is one of the leading venture capital investors in the world. They receive ideas in various stages of development every single day. YouTube was just an idea when Sequoia began working with the founders. Google, on the other hand, was further along; a version of the search engine was already running, which allowed the founders to demonstrate the value of selecting Google over other search engines—very tangible proof of an idea that was already succeeding. How good is Sequoia at picking ideas? They estimate that 19 percent of the NASDAQ’s value is made up of firms they have funded.3 So: pretty good!
To evaluate ideas, Sequoia asks those who submit their business plans to anticipate a number of questions, including:
While some of the best ideas began as scribbles on napkins, evaluating and testing these ideas requires much more work. Most pitches Sequoia receives will fail to meet one or more of the criteria they use to filter ideas. A working prototype might prove that a company can solve a problem; however, there might still be questions about whether the market is ready for the idea. Or a business might be operating well, but the market might not be large enough to enable a good return. A prospective firm might offer a valuable service, but the cost to sell and market it might make it too expensive to provide value to enough customers.
To address the challenges involved in asking for and reviewing ideas, Sequoia categorizes them into different levels of maturity. Seed stage ideas are, as the name implies, idea kernels: they represent businesses that are just getting started and that face some risk before they can fulfill their potential. On the other end of the spectrum are growth stage investments, which represent much more than ideas. These businesses are already running, and have answered many of Sequoia’s questions with ample real-world data in the form of customers, sales, market share, and growth rates. Sequoia is phenomenally good at understanding the potential of ideas; however, they also look to balance risk. They know that early-stage ideas have a lot more ways they can fail, compared with later-stage businesses.
Organizations that are framing questions for crowdstorm challenges need to decide, like Sequoia does, how much execution risk they are willing to take on. If your company seeks to explore the art of the possible and you frame a call to action for seed stage ideas—kernels, concepts, and perhaps the enlistment of open call participants who have submitted these ideas—then you need to be comfortable with the long and risky road ahead. It is cheap to start and can be expensive to finish in terms of time and money. As you look for more mature ideas, individuals, or teams, those who respond to your challenge will, understandably, seek more compensation because they have reduced risk for you in moving from concept to production of the idea. In other words, you will pay more for ideas that are more mature or you may not be able to own them at all, but simply partner or purchase a stake in an existing entity.
Let’s turn to some of the cases we have explored so far. GE’s Ecomagination challenge set out to find the best emerging technologies to achieve a number of different corporate objectives. Like Sequoia, GE was comfortable taking on the role of investor. GE based their assessment of the value of ideas submitted on their ability to invest and ultimately own a share in the organizations that provided those ideas. Beyond investment, GE was relying on others to produce the ideas, so that they could focus on other areas—like distribution, marketing, and sales. GE recognized that they were already strong in these areas and that finding new products and services to sell would be another way for them to benefit, beyond direct investment.
This contrasts with our discussion in the previous chapter regarding P&G’s focus on licensing ideas through their Connect and Develop online work environment. Like GE, P&G has very strong distribution and marketing capabilities. But their perspective is different from GE. Their Connect and Develop program is not focused on investing in existing organizations, although they have programs for this. Instead, P&G’s Connect and Develop program assumes that if someone has an idea to solve one of their problems, P&G will license the idea and figure out how to produce it at the scale necessary for their business operation. Historically, this has worked very well for a range of products from soaps to drugs. (It is less clear whether this works for services or communications, where the ideas might be harder to encapsulate in patents.)
Table 3.1 highlights the different ways in which organizations access ideas, from licensing to investment, and also shows different stages of idea maturity in each case.
Table 3.1 Different Approaches to Accessing Ideas at Different Levels of Maturity
According to former P&G CEO A. G. Lafley, “Innovation is a social process. And [it] can only happen when people do that simple, profound thing—connect to share problems, opportunities, and learning. To put it another way, anyone can innovate, but practically no one can innovate alone.” Lafley made this statement in regard to P&G’s decision to open up their innovation process.4
The “social process” of open innovation not only gives rise to ideas; there are other results, as we highlighted in the first chapter. We have seen four other ways that the crowdstorm process generates value: identifying talent partners (that is, the people behind the ideas), generating conversations (about the ideas), selecting ideas (based on feedback and evaluation of ideas), and strengthening relationships (with stakeholders, such as customers and suppliers).
It is easy to understand the relationship between ideas and talent. While an organization might choose not to benefit from a specific idea, there remains an opportunity to establish a relationship with the individuals or groups responsible for the idea. Next, we provide a snapshot of a few implications that should help in structuring calls to action when looking beyond ideas.
More things matter in an environment where people can share and discuss commentary and content—from how organizations respond to customer issues, to what they choose to support. Asking questions can be an important way to signal how important an issue is to both your organization and to a broad community. For example, there were significant media opportunities with the GE Ecomagination and Starbucks Betacup challenges, since both initiatives signaled that the companies were focused on specific sustainability issues.
The content was valuable for solving the problem and also for communicating something about the brands. Additionally, these challenges were open to anyone. The launches generated excitement and were widely covered in the media and discussed on the social web, as were the subsequent announcements of winners, deals, and launches. In short, these brands generated value just by asking the questions. Additional visibility for participants is a plus, and something we will revisit in the next chapter when we discuss motivation and fairness to participants. Shaping the brief with an understanding of content is not only important as a solution but as a media vehicle as well.
One aspect of the crowdstorm process that is easily overlooked is gathering feedback to help filter ideas. LEGO’s Cuusoo process exists to explicitly ask the crowd to help identify the best ideas. The calls to action in this case are requests for participation as well as idea submissions—engaging those who vote as well as those who submit ideas. In the process, LEGO learns about the attractiveness of ideas and also establishes a core group of initial advocates and customers before they have invested anything to bring the ideas to market. As we will discuss in more detail later, these discussions have implications far beyond the specific ideas—they impact and shape relationships between participants and the organizations facilitating the conversations.
So far, we have focused on establishing the outcomes you seek as well as the maturity of the ideas you wish to receive. We have also suggested that other products of the social process should shape calls to action. However, a great deal of success also depends not just on what you ask for, but how you ask for it. And while it certainly helps to say “please,” there are some other elements that will help too.
Critical differences exist between communicating with large groups (thousands or more people) and communicating with the smaller groups we typically work with (where 100 might be defined as a large project team). First, once you interact with much larger groups, you cannot make the same assumptions about what people will understand. Prospective participants may not share much common understanding of your organization’s strategy, philosophy, or values. You will have to do more to ensure that participants are inspired and have a clear idea of what is expected of them. And you need to do this efficiently because the channels you will use to communicate will afford you less attention than our usual options for communication with our internal teams.
At this point, you might realize that this is not very different from a request for proposal (RFP), and you are right. There is a lot we can learn from RFPs.5 Many of the components when framing questions have been in circulation and used by various disciplines for a long time. They have been adapted from approaches as old as the Socratic method with its emphasis on open and ongoing questioning that allows for inquiry from many vantage points. The components have become part of the fabric of professions as diverse as scientific investigation (with its focus on testing and measuring outcomes) and legal inquiry (with its emphasis on creatively exploring the contours of currently held positions), as well as for how RFPs are shaped.
Although understanding the relationship between briefs and outcomes is not yet fully researched, early studies suggest that inspiration is critical. Working with Stanford University’s Center for Design Research and the association of Danish designer Søren Petersen and Peter L. Phillips, an attempt was made to quantify the relationship between briefing attributes and results.6 Increasingly, they found that context was critical to performance, and that most briefs lacked even the basic elements of strategy and context, and focused mostly on performance-related issues such as process (the how elements).
Desirable strategy elements include corporate philosophy and values, as well as level of ambition and desired impact. As we already noted, these are the kind of things you can assume your colleagues know; outsiders—particularly those external to the organization—likely will not. Strategy might also include current desired competitive advantages or a vision for how an organization plans to compete in the future. Contextual elements tend to highlight key stakeholders, broader environmental and social concerns, and time-to-impact measures such as viability and feasibility.
We found this emphasis in many of the cases we have discussed so far. GE made a great effort to focus on what they were looking for in solutions. They provided a clear explanation of the potential value, as well as the challenges of renewable energy for each of three categories in the challenge. They also made their ambitions clear: what might the world look like if we could solve this problem. And, while they offered little guidance on how one might achieve the solutions, they did explain how they would evaluate submissions: how much impact the proposed solutions could have and whether or not the idea might be brought to market at a price appropriate for their benefit and the approach’s overall uniqueness.
We see similar characteristics if we look at the Betacup challenge, where the brief clearly expressed the desired end result—no more use of paper cups. The brief did not focus very much on how the outcomes should be achieved, though they did highlight areas where Starbucks was investing time and resources. The brief also provided a significant amount of context, including overall philosophy, examples of the types of innovations sought, and social considerations.
Graham Hill had a vision in 2009. As CEO and founder of TreeHugger (a leading media outlet dedicated to bringing sustainability ideas to the mainstream), he wanted to help people create urban living spaces that would give them “more money, health, and happiness with less stuff, space, and energy.” He wanted to launch his new venture, LifeEdited, in a unique way. He:
purchased an apartment in New York City with the express purpose of showing that people could have everything they needed using less (and better) stuff and space.
Graham had big dreams for the small space (430 square feet to be exact): dinner parties for 12, accommodations for two overnight guests, a home office, a home theater with digital projector and, befitting his background, it had to have very clean air and be built in an environmentally responsible manner. To make this dream a reality, the web-savvy Mr. Hill called on the crowd-sourcing platform jovoto and marketing firm Mutopo to launch a competition to design the first space.7
When we met Graham to discuss the project, we received a deluge of requirements and inspiration—he had been thinking about the design for the apartments for a while, and he and the TreeHugger team had covered many types of low-footprint living ideas—from transforming furniture to insulation. After evaluating how to use current technologies, they believed that they could achieve an 80 percent reduction in energy and water use; and they had developed detailed requirements outlining what they believed was necessary to achieve this outcome right now.
Based on these extensive requirements (one spreadsheet described 57 of them!), Graham had been preparing to begin work with an architect to design one of his apartments. He also worked with us to consider the alternative of doing an open call soliciting design ideas from a global community of architects, engineers, and designers. In order to do this, we discussed how to reframe the requirements to reduce the brief’s complexity while ensuring that he met his overall goals. However, he wanted to do so in a less prescriptive way that allowed for more creative flexibility. So we set ourselves a task of making certain that the creative community felt they had an opportunity to make the design their own—while simultaneously ensuring that Graham’s design requirements were met.
To do this we worked with Graham to modify the call to action in three ways. First, we anchored the challenge by grouping the long list of requirements into broader themes. After a number of iterations, we arrived at the following:
To these themes, we added evaluation criteria. Successful designs needed to meet standard criteria: the design had to address key requirements. It also had to meet the following specific guidelines:
The response to the design challenge was amazing—with over 300 diverse submissions from all over the world. And the submissions drove even further refinements: the team posted entries throughout the challenge period on the TreeHugger site that provided continual feedback to the creative community. The feedback helped to refine the direction of the challenge and helped improve the designs.
Graham chose to open the competition to the public. This prompted not only a large group of architects and engineers to submit ideas, it also attracted an influential audience who used social and traditional media to disseminate content about the challenge and raised awareness of LifeEdited. Widespread online conversations and media coverage took place, resulting in more than 15,000,000 media impressions across publications such as the Huffington Post, Fast Company, Good, and Discovery News, as well as Twitter and Facebook.
And, as it turned out, this approach didn’t just help Graham explore a broad variety of designs for the apartment and ultimately find what he’d been seeking. He also found a new design partner—the contest’s winner—who worked with Graham to design his second apartment.
Evaluation criteria provide an essential way to shift the focus of a brief—from figuring out how to solve a problem to determining what should be achieved. In the case of LifeEdited, Graham included a checklist of attributes but also provided broad “-ilities” like replicability and feasibility. Graham’s success was not just a function of solving the issues of designing the apartment. It also ensured that solutions could work for many more apartment designs to achieve his goal of giving more people options to live lower-footprint lives.
As we discussed, Sequoia Capital makes uses of a range of criteria to spell out the attributes they will test for—from size of the addressable market to questions about market timing. However, Sequoia does not specify the type of business. They have invested in everything from retail to search, from database software to online video. They are focused on the attributes that make these business ideas interesting.
Evaluation criteria broadly fall into two categories. There are some measurable elements; for example, does a design contain a specific component, achieve a specific price point, or complete an action in a given time? In some cases, we need to make assumptions. For example, when Sequoia decides on the future opportunity for video services, they need estimate how much advertising revenue they will be able to realize based on the amount of inventory necessary and at what price the advertising can be sold.
Other criteria are much more subjective—for example, selecting the best graphic design, the best new LEGO set design, or the best script for a TV advertisement. Expert judges, creative directors, or a voting process use these criteria as markers to assess results.
An easy way to think about this is to imagine Olympic competition. Winners for many events are declared by virtue of how far they throw or how fast they run—in other words, easily measured criteria. There are some assumptions (for example, no performance drugs are involved, which can be tested). Many other activities, however, have judges that use some criteria to evaluate performance—think of diving or certain gymnastics competitions, where there are also elements of subjective evaluation.
Evaluation criteria set the boundaries for ideas by letting participants know where to aim versus how to get to the desired end goal. We will look at using evaluation criteria in more detail in Chapter 9.
“Imagine a portable, wireless device in the palm of your hand that monitors and diagnoses your health conditions. That’s the technology envisioned by this competition, and it will allow unprecedented access to personal health metrics. The end result: Radical innovation in healthcare that will give individuals far greater choices in when, where, and how they receive care.”8
This is the introduction to the X Prize Tricorder challenge. The X Prize Foundation raises money to establish rewards in a number of different categories, from space exploration to health care. The Tricorder challenge demonstrates a very smart bit of storytelling and conveys how critical narrative is to asking good questions.
The Tricorder reference was designed to conjure up a very specific vision of a device—one that so far only exists in the fictional universe of Star Trek, the epic science fiction series. The brief used the reference to provide a vision of the future that would inspire the challenge’s participants. The brief contrasted the vision of the realities of today—21 days to wait to see a doctor in the United States—and an average visit time of two hours. Many of these visits were simply to collect information—something the X Prize wanted to see happening via a real Tricorder.
The Tricorder Prize is an important introduction to the last set of attributes of a great call to action—storytelling.
Good RFPs and calls to action share traits found in narrative. Framing a question to inspire creative problem solving often requires that you develop a story line that takes the audience—your participants—from point A (the status quo) to point B (the resolution). Many stories work because the storyteller makes the improbable seem inevitable; the narrative moves us to a conclusion that inspires, delights, or instructs. Managers who can compel teams to look for innovative answers are often good storytellers: they frame questions to help teams find the narrative thread that leads them from the expected (or status quo) to the unexpected solution.
One additional benefit of a good story is pass along value. People share or pass along great stories, resulting in greater awareness and ultimately more participation and good ideas. Jonah Peretti—who co-founded the Huffington Post and, more recently, BuzzFeed—knows something about what makes people share. He has built media properties that create stories that people want to share.
In an interview in May 2012,9 he suggested that the new currency in the social world is emotional intelligence or, as he put it, “being able to think, ‘When I share this, how does it make me look? Can I make my friends happy or inspired or more informed by sharing things with them?’” The Betacup, GE Ecomagination, LEGO Cuusoo, LifeEdited, and Triple Eight briefs inspired participants to feel good about sharing. When we look at participant sources, social web channels proved very successful for recruiting—more about that in Chapter 6.
Here are a few other important techniques that we have touched on.
Language needs to be jargon-free in order to engage as wide an audience as the organization deems feasible to get good ideas. For instance, P&G avoids talking about chemical compounds when they’re seeking new product ideas. They are interested in the end state solution and are careful to avoid defining the outcome by the chemistry to get there. When Graham defined his brief, he did not layer in the engineering detail required for meeting the requirements; instead, he focused on the goal of efficient sustainability and left it to the architects, engineers, and designers to provide the detail.
An open call also demands that an organization consider how transparent it thinks it can be with its information. It needs to balance the desire to engage lots of people with the risk of sharing information with people it does not know—and take into consideration the competitive implications of this. As we think about the participant lifecycle, we must think about what we can disclose to get attention and what might ensure consideration. Once people participate, we have the option to propose additional terms before sharing information—it is not uncommon to require nondisclosure agreements to learn more about the details of a brief.
Finally, we will discuss the role of partners to create coalitions. Very often partners can provide unique perspectives to help shape and refine briefs.
Good calls to action share a number of characteristics: clearly defined outcomes and the desired maturity of responses needed, the right level of detail required to engage the community, transparent evaluation criteria, and the right story and vision to inspire external talent to participate and deliver great results (see Figure 3.2.).
Figure 3.2 Characteristics of the Call to Action
These are the attributes that can help you test whether you have a solid call to action. The call to action is just one part of the equation. Convincing participants to join your crowdstorming effort also requires the right mix of incentives. Let’s look at this next.
Notes
1. The links to the briefs are as follows: GE Ecomagination, www.ecomagination.com; XPrize Tricorder, www.xprize.org/x-prize-and-qualcomm-announce-10-million-tricorder-prize; Starbucks Betacup, www.jovoto.com/projects/drink-sustainably/briefing; Triple8, www.jovoto.com/projects/triple8/briefing; LEGO Cuusoo, lego.cuusoo.com; Sequoia Capital, www.sequoiacap.com/ideas; LifeEdited, www.jovoto.com/projects/life-edited/briefing.
2. Alexander Osterwalder and Yves Pigneur, Business Model Generation: A Handbook for Visionaries, Game Changers, and Challengers (Hoboken, NJ: John Wiley & Sons, 2010).
3. For details see Crunchbase, www.crunchbase.com/financial-organization/sequoia-capital.
4. Ram Charan and A. G. Lafley, The Game-Changer: How You Can Drive Revenue and Profit Growth with Innovation (Random House, Inc. Kindle Edition), Kindle Locations 489–491.
5. There are a number of good discussions on this topic covering simple RFP writing and issues including: Marketing Profs, www.marketingprofs.com/9/developing-rfp-seven-tips-for-getting-responses-you-want-dwyer.asp; Bud Porter-Roth, Request for Proposal: A Guide to Effective RFP Development (Addison-Wesley); and Ron Ashkenas, “The Art of Asking Questions,” Harvard Business Review (August 30, 2011), blogs.hbr.org/ashkenas/2011/08/the-art-of-asking-questions.html.
6. Søren Petersen and Peter L. Phillips, “Inspiring Design-Informed Metrics,” dmi Publications (Vol 22, No. 2, Spring 2011), http://www.dmi.org/dmi/html/publications/journal/fullabstract_d.jsp?itemID=11222PET62.
7. From the LifeEdited web site, www.lifeedited.com/about.
8. For details see XPrize, www.qualcommtricorderxprize.org/.
9. For details see Jessica Roy, “BuzzFeed Cofounder Jonah Peretti Preaches the Science of Memes,” BetaBeat, June 3, 2012.