What Do Numbers Say About Different Models of Innovation?

I’m not a fan ofimages the “idea generation” model of innovation. This approach, which I call “bottom-up,” puts the focus of innovation on ideas that are generated by employees on the ground and then channeled upwards to senior management. I think that the bottom-up approach is plagued with a numbers of serious flaws that I discussed here and here.

A plausible alternative to the bottom-up model of innovation is the “top-down” one, an approach that focuses on problems. In this model, a company’s leadership formulates problems that are strategic to the organization and then moves them downward for employees to find solutions to these problems. Again, I outlined the benefits of the top-down approach here and here.

Personal preferences notwithstanding, can we find any specific numbers pointing to a superior efficiency of one model over the other? Here is what I can offer and I strongly encourage anyone to challenge my numbers–or come up with their own.

Take InnoCentive, an open innovation service provider specializing in crowdsourcing. Its business model is a classic example of the top-down approach: InnoCentive’s clients post technical and/or business problems (“Challenges”) to the InnoCentive website, and a network of InnoCentive “Solvers” (365,000+ from nearly 200 countries) work on finding solutions to these problems. InnoCentive boasts up to 85% success rate of their Challenges.

Compare this to Dell’s Idea Storm, an external innovation portal designed to solicit open-ended ideas from consumer, a typical example of the bottom-up model of innovation. The opening page of Idea Storm tell us that of total 23,731 ideas submitted to the portal only 549 were implemented. That is slightly above 2%.

Sure, I understand the difference between soliciting ideas from outside a company vs. the company’s own employees–as I credit InnoCentive’s remarkable skills in formulating problems on behalf of its clients–and yet, the difference in the efficiency for both approaches is staggering.

That’s what numbers say.

Image credit: www.onlineastrologyconsultancy.com

 

About Eugene Ivanov

Eugene Ivanov is the Founder of (WoC)2, an innovation consultancy that helps organizations extract maximum value from the wisdom of crowds by coordinated use of internal and external crowdsourcing.
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5 Responses to What Do Numbers Say About Different Models of Innovation?

  1. Pingback: 3 Ways to Improve the Efficiency of the “Idea Generation” Process |

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  4. Pingback: Don’t “fiddle” with the crowd — ask it better questions instead |

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