innovation… what a concept.

I’ve continued reading Jeff Howe’s book Crowdsourcing: Why the power of the crowd is driving the future of business. Two remarkable stories that have sent me off on a great tour of various websites, ideas, individuals, and so on.

First, in the early part of Howe’s book he introduces Proctor & Gamble’s “innovation community”. In the mid-2000s, faced with slumping sales and stock price (i.e. stock had lost 50% of its values or $75 billion in market cap). The P&G board hired a new CEO who created a program called “Connect and Develop”. The main goal of this initiative was to raise the percentage of new products developed from outside of the company (yes, outside) – from 15% to 50% by 2007.

At the time, P&G had 8,500 researchers on staff – and yet they figured there was probably another 1.5 million similar researchers with pertinent expertise such as retired staff, and other folks from around the world. The new CEO, A.G. Lafley helped create YourEncore a website that would “tap the collective brainpower of scientists around the world.” Another drug multinational Eli Lilly was also involved and Boeing signed on in the first year.

These companies post various ‘problems’ or issues on the site and the network of outside scientists and engineers tackle the problem. P&G managed to regain all of its lost stock price and tripled net profits to over $10 billion in 2007.

Another similar network of scientists and engineers was created by Eli Lilly – InnoCentive. This is a network of over 140,000 scientists and engineers from over 170 countries. Various problems are posted on the website with a cash reward. For example, the most recent problem posted is to try and find a solution to insects damaging maize corn – the cash reward is $20,000. And, it’s not even the actual solution it just hast to be a proposal.

The really crazy part about InnoCentive is that so many of the “scientists” involved are folks with jerry-rigged backyard labs. Howe tells a great story about Ed Melcarek who runs Kelly’s Auto Body in Barrie, Ontario. Ed is one InnoCentive’s most succesful problem-solvers and he does it from a one bedroom “lab” above his shop, cigarette between his lips, and “attacks problems that have stumped some of the best corporate scientists at Fortune 500 companies.”

One of his easier ‘solutions’… $25,000 for figuring out how to inject fluoride powder into a toothpaste tube without the fluoride dispersing into the surrounding air. He knew his solution before even finishing reading the problem – charge the fluoride particles electrically so that they would be attracted to the tube.

OK… so this is not a post promoting any of the multi-national drug companies, however, if some of the biggest companies on the planet can come up with some pretty darn innovative ideas; why are some our larger government bureaucracies lagging miserably?

Any thoughts?

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