Donal Reddington on mass customization, crowdsourcing and digital manufacturing


Dell sources ideas from customers with IdeaStorm

Business Week has written about Dell’s new IdeaStorm initiative, suggesting that feels a lot like Digg.com, the popular tech news aggregator.  The similarities are strong:  users of IdeaStorm post suggestions and the community votes, so that the most popular ideas rise to the top.
The writers of the Business Week Article are Don Tapscott and Anthony D. Williams, co-authors of Wikinomics.  They analyse IdeaStorm as follows:

Initiatives like IdeaStorm are a starting point. Most companies still equate “prosumption”—the process of making consumers an active part of the creative process—with “customer-centricity,” in which companies set the basic elements and let customers modify others, such as choosing options for a new car. In our view, customer-centricity is pretty much business as usual. In the new model, customers participate in the creation of products in an active and ongoing way. They do more than customize or personalize; they add value throughout the product life cycle, from ideation and design through aftermarket opportunities.

While IdeaStorm may be held up as an example of co-creation, it is difficult to get away from the belief that it is really just free market research.  Participants gain no privileges from their membership of the community, other than the vague possibility that their idea might be taken up if it is popular enough.  There are no discounts or other benefits for those who suggest successful ideas.  In fact, Dell make it clear that there is absolutely nothing in it for the customer, in licence section of the IdeaStorm terms of use:

You grant to Dell and its designees a perpetual, irrevocable, non-exclusive fully-paid up and royalty free license to use any ideas, expression of ideas or other materials you submit (collectively, “Materials”) to IdeaStorm without restrictions of any kind and without any payment or other consideration of any kind, or permission or notification, to you or any third party. The license shall include, without limitation, the irrevocable right to reproduce, prepare derivative works, combine with other works, alter, translate, distribute copies, display, perform, license the Materials, and all rights therein, in the name of Dell, or its designees throughout the universe in perpetuity in any and all media now or hereafter known.

The license shall also permit Dell and its designees to use portions of the Materials you submit, rerecord or modify any audio tracks or visual images you provide, rewrite any Materials you submit, and/or incorporate other materials, either created by Dell and its designees or licensed from third parties, with the Materials you submit. Any such works shall be deemed Materials owned by Dell and shall not be subject to your approval or payment by Dell of any compensation to you…..You acknowledge and agree that the relationship between you and Dell is not a confidential, fiduciary, or other special relationship. We shall have the right, but not the obligation, to use your name, likeness, biography and other information about you in connection with any use of the Materials you submit.

By making a submission, you acknowledge and agree that Dell and its designees may create on their own or obtain many submissions that may be similar or identical to the Materials you submit through IdeaStorm or other channels and means. You hereby waive any and all claims you may have had, may have, and/or may have in the future, that the Materials accepted, reviewed and/or used by Dell and its designees may be similar to your Materials.

Pretty emphatic.  While the co-creation concept doesn’t specifically include a reference to tangible benefits flowing to the customer as a result of their participation in the process, it is very obvious that Dell expects the benefits of IdeaStorm to flow in one direction only.

Update: Lionel David at the Crowdspirit Blog had written about this issue before I did.

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3 Responses to “Dell sources ideas from customers with IdeaStorm”

  1. RichardatDELL Says:

    Thanks for the interesting perspective. However, I think its a little unfair.

    Isnt the whole concept of an interactive web for customers and companies to compare notes, build better, and in our case, even stronger, direct 1:1 relationships.

    Ultimatley the direct dialogue results in better products and customers have the benefit of input and involvement to ensure products and services best meet their needs.

  2. Donal Reddington Says:

    Richard,

    Thanks for your input.

    I very much hope that IdeaStorm enables Dell to build ‘stronger, direct 1:1 relationships’. However, I would offer some friendly advice: relationships involve a degree of give and take. For it to work in the longer term, IdeaStorm needs to make its participants’ feel that their contribution is appreciated.

    No-one’s expecting a seat on the board. But the prospects for IdeaStorm will be far better if the participants can see that their contributions are being appreciated. This could be shown in different ways, both tangible and non-tangible. As an example of the type of tangible benefits that might be offered, I’d suggest reading the Hallmark case study in Patricia Seybold’s book ‘Outside Innovation’. While Hallmark make cards and not computers, the way in which they provide relatively small benefits to members helps to maintain the continuing participation of its online community.

    In Dell’s case, the type of tangible benefit could be something like a discount voucher for printer consumables for members who are considered (by whatever means Dell prefers) to have made a significant contribution.

    Even if Dell doesn’t want to provide any tangible benefits to IdeaStorm members, it could use intangible ‘stuff’, for example an occasional exclusive webchat with Michael Dell for IdeaStorm members only, or an invitation to visit Round Rock for the best participants, or whatever.

    Even if Dell don’t want to give anything, that would be tolerable. What’s most off-putting is this bit:
    “We shall have the right, but not the obligation, to use your name, likeness, biography and other information about you in connection with any use of the Materials you submit.”

    The IdeaStorm member doesn’t even have control over the use of their own name. That’s grating.
    In value terms, it can actually mean the IdeaStorm member ends up with a benefit of less than zero, if Dell gets to use their name for its commercial gain.

    I’m sure that Dell will be analysing usage data from IdeaStorm over the coming months. If your churn of members (who participate for a short time and then leave) is high, maybe the issues I’ve outlined here have something to do with it.

    I very much hope that IdeaStorm is successful. Dell has been a great example of how mass customization can be applied on a global scale. So I am supportive of Dell’s efforts to build closer relationships with its customers.

    The good news is that it’s early days for IdeaStorm – Dell can still fine tune the concept to improve its chances of becoming a vibrant community of customers that will stay the course as members and customers.

  3. Chris Says:

    Donal a year after your review it seems IdeaStorm is thriving without a “Reward” for participation. Well on second thought I think the “Reward” is actually having a forum to share ideas with a company. This is not widely available at most consumer goods companies and customers seem to love it.

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