Reward & Reputation – The Currency of Customer Involvement in Product Co-Creation – Part 1

26 04 2007

The rising trend chart above is a real-time traffic report on the use of the term “co-create” by bloggers over the past 360 days from Technorati.

While product and service co-creation practices are in the “early adopter” acceptance stage among organizations seeking to improve the customer experience, it would be useful to examine a critical component of success that makes this approach work as an “open source” strategy, namely designing a good reward and reputation system for your participants.

Note: If you have not reviewed the earlier postings on the “product co-creation process,” please locate the two postings via the search function to the right. This post series will assume you are already familiar with it.

Appreciating Motivational Differences Among Stakeholders

As we progress through our own professional development we learn that each of us have different personality profiles and learning styles. So it should come as no surprise that we are all motivated differently to share our time, energy and other resources on projects coordinated by others. We need to understand very clearly the needs, expectations and outcomes of the target audience we hope to engage in the product co-creation process with appropriate rewards and means of managing reputation that supports the diversity of motives specified.

What are the possible motivations for people to contribute as volunteers? Does it change among generations?

One of the biggest misnomers is that the era of the volunteer has ended (The Bowling Alone premise that the sense of community and participation is over.)

This is only partially true. What is important to remember is that it isn’t that people are less interested in volunteerism, rather it is the construction of the opportunity to participate that has changed. This also addresses the question of generational differences.

I am part of the US Boomer generation (with ego in check). Professionals in this cohort have engaged in the traditional model of volunteerism and in many cases devised a blizzard of policies, procedures and rules of engagement that bred a uniquely closed culture of “follow along to get along.” As the following studies will show, this whole model of engagement must change. The process must become more open and transparent to the members at large or risk losing the NetGeneration (aka Millenials) who (to put it mildly) chafe at this model.

What must be understood is that traditional “closed, command structures” of engagement (top-down) is being replaced or at least modified to become more of an “open, distributed structure” (bottom-up). The former is more rigid and slow to adapt. The latter more flexible and responsive. The latter is also far better at understanding the customer because they are actually engaged in product or service development.

In 2002, the Boston Consulting Group completed a study on open source software hackers to learn their motivations behind the tremendous amount of time and resources they devote to volunteering to write software for free. Here is what BCG learned:

  • Average age was 34 (this number is surely to become lower as Millenials join in larger numbers) and respondents were from around the world
  • They volunteered significant personal time
  • Central premise to be creative
  • Motivators ranged from personal enjoyment, apply and improve their professional skills, freedom, further the movement and/or profession
  • Of no importance was to attack proprietary software companies (a big surprise)
  • Strong identification with the process and engagement of open systems and working in collaborative teams online

BCG created a audience segmentation from the survey based on these motivations which is a good model to consider as you determine your own stakeholder need profile:

  • Believers represented 33% – motivated behind the cause of open source software
  • Fun Seekers made up 25% – motivated because it was their avocation or intellectual stimulation
  • Skill Enhancers composed 22% – motivated as a means of improving their professional abilities
  • Professionals totaled 22% – motivated by work-related project deliverables

These results (along with the research conducted by author and speaker Don Tapscott and others which maps out the needs and expectations of the NetGeneration/Millenials) suggest the construction of a reward and reputation (R&R) system that can fulfill these needs. For example, you’ll need to consider whether you need:

  • Different rewards for each audience type.
    • Believers – R&R should be cause-oriented (intrinsic motivators are big with this group and include the project itself with cause-focused considerations made throughout the product or service design process)
    • Fun Seekers – R&R should permit this group to engage their personal abilities at the right point in the product or service development process (e.g. if I like to blog and am good at it maybe I can help develop the promotion plan to create buzz around the product or service launch)
    • Skill Developers – R&R can be the same as the previous group but most importantly provide means to enhance “professional” status (e.g. formal recognitions, opportunity to list their work as a professional credit,etc)
    • Professionals – R&R must offer clear and direct results-orientation to “their work issues and needs” (e.g. end product or service or through the collaborative process of product or service design they benefit in a direct and measurable way)
  • When to capture this information – (e.g. by asking them which stakeholder group they might most identify during the sign up phase) will help you determine how many of what group motivator type you have.
  • Different roles require different R&R – you’ll likely have product idea leaders, project team leaders, project participants, subject matter expert so plan on richer rewards or recognition based on time and resource expended

In our next post in this series on Reward & Recognition we’ll examine suggestions for creating such a plan and also explore some additional research findings in this area.

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