Public Facing Innovation in Organizations

Instructor: Beth Hendricks

Beth holds a master's degree in integrated marketing communications, and has worked in journalism and marketing throughout her career.

What if your best idea could be developed by a big-time company? With public-facing innovation, it's possible! In this lesson, you'll learn more about this innovation and discover several companies tackling it successfully.

Connect and Develop

If you're like most consumers, you've spent an evening watching television, only to have a commercial for a particular product catch your eye. You watched the advertisement with interest, and once it ended, the wheels in your head started turning. Maybe you had an idea for how the product might be improved, or perhaps the commercial gave you an idea for a new service.

The good news for today's innovators is that more and more companies are opening their eyes and ears to consumers, in an effort to keep pace with the rapidly changing world of product research and development. This new notion, called public-facing innovation or sometimes open innovation, has forced organizations to look beyond their closed labs and top-secret facilities. Many of today's most successful companies are tapping the talent pool tied to their brand from the outside, and extending the walls of their corporate community beyond the institution itself.

What is Public-Facing Innovation?

Public-facing innovation is exactly what it sounds like it might be: turning to the public for fresh and creative ideas. If you think about it, public-facing innovation takes what may be a 10 or 20-person product research and development team and turns it into a vast department of thousands or hundreds of thousands. Have you ever heard the saying, 'Two minds are better than one?' That summarizes public-facing innovation in a nutshell: accepting that there may be great minds with great ideas who exist beyond the walls of your company. Public-facing innovation allows a company to tap that greatness for their benefit.

Companies who want to tackle an open innovation program cannot simply embark on opening the floodgates and letting the ideas in. They must be prepared to manage the thousands of ideas they receive and channel those ideas in a constructive way, both through organization and potential product creation. Several well-known brands are doing just that, including:

  • BMW: this automobile manufacturer has used innovation contests to draw ideas from its online communities.
  • Unilever: this manufacturer of popular home and personal care products has a website with a list of 'needs' for innovators to check out and match their Sustainable Living Plan.
  • LEGO: LEGO Ideas offers a platform for consumers to submit new creations and then build support for having their item crafted by the company.
  • Starbucks: this coffee giant is also well-known for its online portal, My Starbucks Idea, where coffee fans can submit their best ideas for new social projects, products and services.

Businesses who engage in a public-facing innovation platform stand to achieve a myriad of successes, including better relations with consumers, cost reduction and better profitability, more differentiation from their competitors and quicker product development time to get their items on the shelf.

One company who has realized many benefits of a public-facing innovation program is the company behind the popular brands Tide, Pampers and Charmin. Let's look at a mini-case study of Procter & Gamble's program.

Procter & Gamble's Public Innovation

On the forefront of public-facing innovation, perhaps before that was even a term, is Procter & Gamble, who launched their innovation program, Connect & Develop, in the early 2000s.

The company introduced the program as a result of a period of declining growth, and recognized they needed to ramp up the innovation, and quickly. Procter & Gamble approached their company-wide program design with a needs list in product categories, ranging from beauty products to digital ones. P&G's needs list includes innovations the company is looking for.

The company set a goal that 50 percent of its innovations would include a portion from the public--a statistic that has been surpassed by more than 50 percent. The Connect & Develop platform had a goal of contributing $3 billion toward the company's annual sales growth by year-end 2015.

Procter & Gamble's success in this innovation arena was built on a company-wide mindset that innovation is everyone's job.

One of the first successful adaptations of the Connect & Develop program came as the result of a internal company idea that sought public help. The idea was to print images on Pringles. After much internal deliberation and consideration, the team created a brief that showcased the problem and presented it to innovators the world over for a solution. A bakery in Italy already using an ink-jet printing method responded and the rest, as they say, is history.

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