Leveraging user relationships for innovation within sustained producer-user ecosystems : Observations from the medical technology industry

Abstract: Today we can see how companies are making significant investments in various methods and tools to access and utilize the users’ knowledge for the purpose of innovation efforts. What many highly innovative companies try to accomplish with these investments is to develop and establish sustained producer-user ecosystems. The aim of these ecosystems is often to encourage users to collaborate with each other and with the producer in order to generate innovations related to the offering of the producer. However, although these ecosystems are proven to create new innovation opportunities for companies, it has been shown that a close collaboration with many users brings about a number of challenges for companies. For example, it can be costly and time-consuming to establish and utilize large numbers of user relationships and it can be difficult to align the innovation interests of established producers with those of the users. Moreover, the fact that many innovating users have relationships to one another can contribute to conflicts of interests and established producers may have to balance stability and change within the ecosystem. Another challenge in the utilization of user relationships is that it is not only dependent on the direct interaction with users but also the internal dissemination and utilization of information related to the users’ needs. This dissemination can be problematic since it is costly and difficult to forward timely and reliable information about the users’ needs. Consequently, the aim of this thesis is to better understand how companies that are operating within sustained producer-user ecosystems can leverage user relationships for the purpose of innovation. The research forming the foundation for this thesis was carried out within two established medical technology companies that successfully had developed innovations within this type of ecosystems. Quantitative and qualitative data was collectedand a number of different analyses were conducted. The results reveal that these ecosystems can be understood as a system where direct and indirect user experiences are distributed among employees and users. This in turn implies that employees utilization of user relationships can be understood as a function of the extent to which employees knows and values the pertinence of their own as well as others direct and indirect user experiences as well as accessibility and cost of seeking user-information from other people. The results demonstrate that when companies experience high costs related to the acquisition of user experiences they may benefit from employing users to occupy boundary-spanning roles. However, the thesis reveals how the utilization of such boundary-spanning roles brings with it a number of organizational challenges. Moreover, an important aspect of success tends to be the utilization of relationships to so-called transformational users. These users experience problems with established producers' current products before the majority of users, they adopt new technologies earlier than their peers, and they cooperate with established producers for the purpose of transformation of a product field in order to obtain or maintain a central position within the ecosystem. Furthermore, the results reveal how established producers and users are jointly engaged in value creation through various collaborations. However, the results also indicate that the utilization of user relationships for innovation within these types of ecosystems is, to a large extent, a matter of managing tensions emerging within and around these collaborations. On a general level, this thesis points to the potential benefits of considering producer-user ecosystems as a comprehensive perspective, which may explain how companies gain and sustain a competitive edge, rather than one out of many approaches that companies can apply in order to leverage user relationships for innovation.