Daptiv's Greenhouse: Collaboration Grows

A new open innovation strategy from the software provider asks users to share and follow up on ideas to help improve service

As a senior project manager at Chase Paymentech Solutions in Dallas, Addie Monson oversees part of enterprise operations at the sprawling company, which processes some 20 billion transactions annually from credit cards and point-of-sale payments. But since February, Monson has had an additional responsibility: helping to innovate the portfolio and project-management software from Seattle software developer Daptiv that is used internally by Chase.

Monson was one of some 200 people who participated in beta-testing Daptiv's new customer-driven collaboration initiative, called Greenhouse. No shrinking violet, Monson has let fly with ideas and comments aimed at improving the company's software. "I'm not shy about giving feedback," Monson acknowledges, adding, "To truly be able to help design it [the software] yourself is very empowering."

Greenhouse is provided free to Daptiv clients who can log onto the site from within their project-management software. It is described as "a meeting place to collectively decide" about improving software products. Once on the site, users can explore various categories—such as "plant" or "cultivate"—where ideas are, in Greenhouse-speak, "germinated" and "watered" (discussed and commented on, that is), and finally "harvested" or implemented by Daptiv.

Welcoming the Customer on Board

The initial 200 people in the beta test came from many companies that already use Daptiv software, not just Chase. All their findings have been shared across the platform with other users—and other companies. The next stage, which kicks off June 16, will bring in a larger community of 100,000 Daptiv users at some 700 companies.

A growing number of companies, in consumer products as well as services, are recognizing the power of customer collaboration, which lets consumers and clients play an integral part in the design and innovation process. Companies ranging from Starbucks (SBUX) with mystarbucksidea.com to Chrysler, with its recently announced "customer advisory board," are establishing online platforms, based in part on the concept of social-networking sites, to let customers get more involved in the design and development of consumer products as well as services.

Consider it an e-economy version of the old corporate suggestion box. But here, instead of suggestions being routinely ignored, customers can, in many cases, track whether their ideas are being acted on, listen in on what other users have to say, and vote on ideas.

A Product Development Conversation with Users

For service providers, it's an easy way to get instant—often raw—feedback from customers, which is not subject to market research analysis. It's also a way to portray the company as eager to listen to consumers and to adapt to their needs. Customers feel they are part of a transparent decision-making process because they can monitor whether their ideas are being acted on or ignored.

The theory is that when an entire community of users gets involved and debates and evaluates something, "The best ideas rise to the top," explains Anthony Williams, co-author of Wikinomics, the 2007 book that helped define and promote the concept of mass collaboration (BusinessWeek.com, 6/11/08). "Smart companies are taking that methodology to the next level," Williams adds. "They have discovered that you shouldn't have a product development process that is separate from a conversation with your customers."

So far, at least 237 ideas have been planted during Daptiv's Greenhouse test—from configuring the interface to hide fields not being used, to allowing users to define how many items they see on a page. These attracted more than 250 comments and 1,200 votes. Six have been implemented, including one that allows a user to schedule and deliver reports at any time. The overall goal, says Tim Low, vice-president of marketing at Daptiv, is for Greenhouse to drive the company's innovation process "by creating a closer, more intimate dialogue with customers."

The Customer Is Always Heard

Before Greenhouse, Daptiv customers could vent by participating in a Web forum or focus group. But a collaborative online system open to all vastly expands the possibilities for proposing new ideas and refining existing ones, because it allows one customer to pivot against the idea of another. "You can get hundreds of thousands of people weighing in and voting on ideas we would not have gleaned from one-on-one encounters in focus groups," explains Nicole Shaw, a product manager at Daptiv. This in turn lets Daptiv see how ideas evolve within the user community, and how important they are, before deciding whether to implement them. And everyone can keep tabs on whether the company is acting—it can all be seen clearly on the Greenhouse site (Starbucks has a similar monitoring system on its customer collaboration site).

Chase's Monson, who became one of the top users of Greenhouse, says she likes the idea of logging on at any time, checking the posted ideas, submitting her own, and seeing if others liked or hated what was proposed. "In the past, I would e-mail or call when there as a problem," she says. Now Greenhouse lets her give ideas directly to the product development team. While two of her suggestions sent to Greenhouse—including a way to customize e-mail notifications sent to users—are currently in the "planted" stage, she says, "[Greenhouse] proves to me they are listening and that they believe the customer is smarter than they are."

Daptiv's Low says Monson's ideas will be delivered "largely as she conceived them," although they have not yet been scheduled for release. These and other ideas that find their way into the software are examples, Low believes, of how software development, usually a long process, can be accelerated with customer collaboration.

Saves Money on Travel and Focus Groups

Still, customer collaboration won't entirely replace more traditional forms of market research, such as surveys and focus groups. Low says initiatives like Greenhouse will augment these tools, which are especially important when researching a new market segment. But Greenhouse will certainly be used as part of a marketing pitch to recruit new clients, because it shows "The benefits of choosing Daptiv go beyond the functionality of the software to the whole experience," Low says.

He declined to provide exact development costs for Greenhouse, but said the site will save "tens of thousands of dollars" spent on travel and focus groups, and that understanding customer preferences provides a cost savings as well as a strategic advantage.

With so many Daptiv customers about to storm the online suggestion box, the company might find itself overloaded. Starbucks' initiative has led to thousands of proposals, including a popular one to "lower your prices," which isn't likely to be indulged.

Williams says companies, after opening themselves up to the onslaught of consumer opinion, have to sift carefully through the suggestions and not base decisions purely on popularity. "The most popular idea isn't necessarily the best," he says. "But at the same time, ignoring what a large portion of your customers think would be a mistake."

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