community powered
TRANSCRIPT
ARTWORK Jacob Hashimoto, lnfinite Expanse of Sky, 2008-2oog, acrylic, paper, thread, bamboo, Studio La Citta, Verona, ltaly
HBR.ORG
CommunityPowered Problem Solving
A health care initiative �n11uu� how brick-and-mortar businesses can co-create s lutions with their partners and change the rules of the game. by Francis Gouillart and Douglas Billings
ALL COMPANIES-EVEN THOSE in entirely B2B, brick-and-mortar in
dustries-are now in a Facebook-like business. Their leaders have
to be communicy organizers who strive to engage the customers,
'--------rsutpp!IeJ:s, emplo ees, partners, citizens, and regulators that make
up their ecosystems. A good way to do that is to provide those
stakeholders with the means to connect with the company-and
with one another-and encourage them to constantly invent new
ways to create value for their organizations and themselves.
This approach is a ra ical departure from the old way of man
aging constituencies through specific processes: marketing and
selling to customers, procuring from vendors, developing human
resourees ¡3elieies for employees, and so on. The problem with tra
ditional processes is that they do 't naturally evolve, since their
April2013 Harvard Business Review 71
SPOTLIGHT ON MANAGING THE CROWD
objective is repeatability and compliance, not con
tinua! adaptation.
Inviting constituencies to collectively salve prob
lems and exploit opportunities is a better strategy.
We call this approach co-creation. It's a new form of
competing, one we described in "Building the Co
Creative Enterprise" (HBR October 2010). As consul
tants, we ha ve helped more than 30 organizations
in financia! services, agricultura! products, sports
equipment, health care, and other industries-go
down this path. In addition, we have studied sorne
200 other co-creation efforts. (See the exhibit "Who
Is Co-Creating?" for a sample.) In this article we'll
show you how to begin this journey, by telling the
story of a work in progress: the co-creation program
that the Medica! Surgical Systems unit of Becton,
Dickinson and Campan y (BD) has been working on
for nearly two years.
The Building Blocks The first step in building a co-creation system is
identifying a large problem that you need the help
of many people from different organizations to sol ve.
Then, to kick offthe design stage, a company's lead
ers should ask these five questions:
1. What community of individuals from inside the
company and across externa! stakeholders do we
need to connect to solve this problem?
2. What p/atform (physical or digital forum) does
this community need to start connecting in new
ways?
3. What new interactions will community mem
bers want to engage in on the platform to design a
solution?
4. What valuable professional experiences will the
members get out of these interactions?
s. What va/ue will this new set of experiences
generate for our firm and for the other organizations
involved, creating a win for all parties?
The answers to those questions form the build
ing blocks of a co-creation system. The idea is to
attract people onto platforms that you've provided,
get them to start exploring new ways to connect and
genera te new experiences, and let the system grow
organically.
You cannot map out the full structure of a co
creation system from the beginning. Building one
is like putting together a jigsaw puzzle: You need
to construct it gradually by assembling pieces in
various corners of the puzzle and then identifying
emerging patterns. (See the sidebar "The Four Steps
of Co-Creation:')
Using the five questions, a company should de
velop a handful of hypotheses about which segments
of the community to mobilize and how. The next
step is to conduct experiments by giving each seg
ment an engagement platform and seeing whether
it generates valuable interactions and insights. The
first experiment should always focus on an interna!
system. (You won't ha ve any credibility with outside
partners if you haven't learned to co-create inside.)
Later experiments will add more and more externa!
partners. You can begin with the people your com
pany airead y has relationships with and then enlist
their help in persuading more people to join your co
creation community.
Live meetings of participants make good ini
tial platforms, but they're difficult to scale up cost
effectively. To handle broad participation, you'll
need to move onto digital platforms. These don't
demand huge investments; you can tap into exist
ing digital connections with your externa! partners
or use inexpensive cloud technology. After a few
months of experimentation, strive to increase the
number of members and segments rapidly and
tackle problems of increasing scope. The larger and
richer the community is, the more everyone in
volved will get out of it.
BD's Big Challenge To see how this process works, let's look at a major
initiative of the medical technology company BD. A
global leader in supplying syringes to hospitals and
their affiliated doctors' offices, BD's Medica! Surgi-
You cannot map out the full structure of a co-creation system at the start. You must piece it together gradually, like a jigsaw puzzle. 72 Harvard Business Review April2013
COMMUNITY-POWERED PROBLEM SOLVING HBR.ORG
Idea in Brief
Large problems often present big opportu
nities. The challenge is that their solutions
often require the collaborative efforts of
hundreds, perhaps thousands, of people
from different organizations. The best way
to make this happen is to provide plat
forms on which these people can engage
with one another and invent new ways to
create value for their organizations and
themselves.
The first step in building such a A model for this is a work in progress
that Becton, Dickinson and Company is
orchestrating. A global leader in supplying
syringes, BD is using co-creation to deepen
its ties with hospital chains by helping
them reduce the incidence of infections
caused by unsafe injection and syringe
disposal practices.
"co-creation" system is to identify a large
problem that everyone has an interest in.
Then you should devise and test hypoth
eses about the segments of the community
that need to be engaged, the platforms
that will allow their members to connect in
new ways, the interactions that will result,
the experiences that members will get
out of the interactions, and the value that
could be generated to create a win
for all.
cal Systems unit set out, in August 2011, to deepen
its ti es with customers by helping them reduce the
incidence of health-care-associated infections, like
hepatitis, caused by unsafe injection and syringe
disposal practices.
Over the previous 15 years, the company had
successfully helped develop new industrywide
injection-safety standards and persuaded hospital
workers to adopt them. But the degree of adoption
varied widely, even within hospitals, and was espe
cially low among doctors and nurses who were af
filiated with hospitals but worked at other locations.
(Hospital systems have been acquiring large num
bers of physician practices in recent years.)
BD's vision of a "safe injection environment"
presented a natural opportunity for co-creation. In
the United States alone, there are thousands of hos
pitals and outpatient facilities, with hundreds of
thousands of doctors, nurses, and waste-handling
employees. Ranjeet Banerjee, vice president and
general manager of Medica! Surgical Systems, and
Micha el Ferrara, his director of strategy, realized
early on that if they too k a process approach and
relied sol el y on the unit's sales force to get al! these
players to change their practices, it would take years
and consume huge amounts of resources.
With our assistance as consultants, they carne up
with a more cost-effective, faster alternative: install
numerous platforms (initially live workshops and
then eventually web-based systems) that would
bring together communities of people who shared
an interest in improving injection and syringe
disposal practices. These included supply chain and
purchasing managers, infection-prevention and oc
cupational health leaders, sustainability managers
and staff, and chief financial officers. At the outset,
BD had relationships with only sorne of those people.
But by the end of the co-creation process, that would
change.
Launching Experiments At BD, Banerjee and Ferrara assembled a co-creation
team of about 10 managers from divisional manage
ment, marketing, sales, R&D, clinical and regulatory
affairs, and IT to develop detailed theories about
which communities to engage and what platforms
to give them. In a one-day workshop, the team carne
up with five such hypotheses.
Then the team began to launch experiments to
test them. The first one la y the groundwork by build
ing an interna! community of BD functions dedi
cated to solving the injection-delivery and syringe
disposal challenges of each hospital. The strategic
account managers (salespeople assigned to the hos
pitals) played the lead role and were supported by
a project team drawn from the same groups repre
sented on the co-creation team, plus an IT supplier
that specialized in social software services delivered
through the cloud. (Previously, the division had no
formal cross-functional process for engaging each
hospital beyond the sales call.) The initial platform
was a working group that interacted through regular
meetings, e-mail, and the company's collaboration,
or social media, tools. The group started by drawing
maps ofhow various BD people interfaced -or could
interface-with the hospital staff beyond the pro
curement and supply chain managers they typically
dealt with. These maps were la ter shared with hospi
tal staffers, who helped identify weak or missing in
teractions and devise new ways of connecting both
organizations. The maps revealed, for example, that
infection-prevention leaders had no way of measur
ing the safety performance of doctors and nurses in
individual locations and no knowledge of how much
training in safety procedures su eh personnel had.
The resulting new interactions in the interna!
comrnunity generated insights into how to irnprove
each hospital's safe-injection and syringe-disposal
record. For example, BD was able to cross-pollinate
April2013 Harvard Business Review 73
SPOTLIGHT ON MANAGING THE CROWD
the medica! staff's and sustainability department's
knowledge about leading practices for injection
and disposal with the R&D staff's ideas for product
design.
The hope was that the new approach would im
prove the professional experiences of all players in
the system. It would make the job of the company's
strategic account managers easier by giving them
a new way to work with a hospital and gain access
to its senior medica! staff. And it would make the
jobs of the division's marketing, medical affairs, and
IT people more fulfilling by including them on the
sales team. The hospital chains would lower their in
cidence of infections, which would reduce their risks
and costs. And BD would deepen its relationships
with hospital networks, in crease sales, and reduce
its need to compete on price.
The second experiment focused on how mem
bers of the interna! community would engage the
hospitals, beginning with the people with whom
BD airead y had relationships: the procurement and
supply chain managers. To recruit the first hospital
chains, Banerjee and Ferrara enlisted Barry Brian,
BD's vice president of strategic sales. He immedi
ately saw this effort as a way to turn his strategic
account managers into trusted advisers of senior
hospital executives. Several account managers were
excited and volunteered to ask the procurement
and supply chain managers whether BD could assist
them in developing a safe-injection environment.
Within three months, six U. S. chains had agreed to
give the program a try. As of January 2013, that num
ber had grown to 16. The account managers asked for the procurement
and supply managers' help in building relationships
with two groups: the infection-prevention and oc
cupational health leaders responsible for controlling
infections and protecting employees of the hospital
network. Their incentive for joining the program was
access to information on leading practices and to
data about their networks, which would make them
more effective-for instance, in providing custom
ized training in infection prevention to their organi
zations' nurses and doctors.
The co-creation team devised a well-oiled
system for collecting data and developing improve
ment programs tailored to each hospital chain. It
employs proprietary tools that identify practices
that cause variability in the incidence of infections
within a given hospital network. (For example, the
model demonstrates how certain variations in
74 Harvard Business Review April 2013
Who ls Co-Creating? Companies around the world are tackling big problems through communal innovation, or co-creation, efforts.
Crédit Agricole A leading bank operating in a d eclining downtown market had to find new sources of growth
General Electric Lower-cost, environmentally friendlier ways were needed to extract the abundant heavy oil of Alberta
La Poste French postal service needed to reverse the steep decline caused by the internet and to improve service
Microsoft Customers were frustrated with anonymous call-center service
Communities of lndian farmers seeking to improve their economic and social lives and protect the land; BASF and ITC fieldbased advisers
Civic-minded investors, downtown merchants, bank advisers from downtown branches, city officials
Surgery scheduling staff, surgeons, patients, medica! d evice suppliers, FedEx operations
Prívate industrial compa-1 1 nies, the government of
Alberta, research center staff
ji Nurses, doctors, insurers, patients and their families, visiting nurses, local construction workers
Customers, teller em-ployees, local post office managers, local citizens' associations
Freelance car and parts designers, customers will-ing to pay for a unique car experience, Local Motors staff
Customers who needed support, call center agents
L
Educational sessions, programs, and tools that promote sustainable and more productive farming
Community-based financia! products that link local saving and lo-cal borrowing and help fund urban renovations and improvements
A sophisticated package technology, SenseAware, that tracks temperature, pressure, humidity, and location
Development of filtering systems that reduce water consumption, by GE and customers who worked side by side at a shared innovation center
Turnaround of a major hospital in Porto Alegre, and creation of a low-cost community hospital
Redesigned, locally customized post office layout and schedule; dramatically reduced waiting times
Online tools for design-ing region-specific cars (such as muscle cars for the Southwest); new car models
A more humanized customer experience, Answer Desk, which al-lows callers to select a personal support agent
product-usage patterns often are a lead indicator of
future problems.)
A small SWAT team initially assesses the prac
tices at each chain and then, with BD experts who
work remotely and the chain's infection-prevention
and occupational health leaders, develops a preven
tion plan. After each diagnostic phase, BD offers to
configure an IT system that uses iPads to deliver in
formation directly to meetings where improvement
related decisions are made at the hospital network.
At first the system is used mostly to provide informa
tion on BD's products and the leading clinical prac
tices on how to prevent infections. But after a tria!
period of three to six months, the hospital network
can choose to enter its own (anonymous) patient
data and benchmark itself against various hospitals
that the company works with.
To gauge its progress, BD tracks two types of
measurements: sorne related to content and others
related to engagement. The former include what
practice areas were investigated during the diagnos
tic phase, what improvements were identified, and
how many recommendations were implemented.
The latter include the number of live diagnostics
conducted, how many people were involved, how
frequently users got on the platform, how long they
stayed on it, what data they found most helpful, how
much of their data they contributed, and what im
provements they achieved in their own operations.
The second experiment has generated a great
de al of engagement, information, insights, and re
sults. As of January, BD had conducted diagnoses
at 16 hospital networks in the United States, and its
divisions in India and China were beginning to adopt
the co-creation approach. Six U.S. networks, which
collectively ha ve hundreds of locations, had agreed
to test out the IT system.
At one network, infection-prevention leaders
were amazed to discover that 26 of their acute-care
departrnents still occasionally used conventional in
jection devices that lacked safety features (to protect
against accidental needle sticks). The situation was
even worse in nonacute-care facilities, where 70%
COMMUNITY-POWERED PROBLEM SOLVING HBR.ORG
of the injection devices used had no safety features.
Correcting this problem in volved simple education
and training of the staff at each location.
BD is using the data gleaned from the diagnoses
to devise rules on the practices that work and those
that do not, which it shares in the aggregate with its
community. (Individual hospitals' data remain pro
prietary.) The data continuously generated by the
IT platforms allow the company and the six chains
to track the effectiveness of practices and to begin
building predictive models that correlate variations
in safety performance with specific factors. They in
elude types of products (sorne ha ve a better record
than others), the safety procedures up and down the
organization, the leve! of training, and the clinical
staff's turnover and experience.
lncreasing the Size and Richness of the Community The third experiment was aimed at connecting BD's
product designers with hospital nurses and doctors.
Nurses, in particular, ha ve lots of ideas about how to
improve syringes, sin ce they handle them daily, but
un ti! the advent of the co-creation program, product
developers tended to interact with users only when
testing designs in the late stages of product develop
ment. The hope is that the users' early involvement
in product design will open up new ways of thinking
about the syringe experience, leading to innovative
ideas that further reduce the inciden ce of infections
and deepen hospitals' loyalty to the company's
products.
This experiment is offto a slow start. Product de
velopers had been successful with the traditional ap
proach, and many were skeptical about having users
participa te in medical-equipment design, so it too k
a while for them to warm up to the co-creation ap
proach. (The original hope was that they would be
involved in the SWAT teams that conducted the as
sessments at hospitals, but they started participating
only in late 2012.) But attracted by the opportunity to
pitch their ideas for new products directly to end us
ers, the developers are now joining the community
With data generated by BD's platform, the community can track the effectiveness of safety practices and build predictive models.
April 2013 Harvard Business Review 75
SPOTLIGHT ON MANAGING THE CROWD
STEP ONE STEPTWO ldentify a large problem that the firm
cannot solve alone.
Develop hypotheses about the interna!
and externa! stakeholders that could
help tackle the problem. (4-6 WEEKS)
Begin by asking which members of your
community would have an interest in the
problem, what platforms (or tools and
forums) could connect them, what new
interactions they could have on those plat
forms, what experiences those interactions
might generate, and what kind of value
everyone involved would ultimately realize.
These five things are the building blocks of
co-creation.
The first should focus on an interna! com
munity, so yo u can prove your ability to
co-create within your company to potential
partners. The second should include exter
na[ people that your enterprise already has
relationships with and people yo u need on
your side as you reach deeper into outside
organizations. You can use the results
produced by early hypotheses to persuade
outsiders-particularly those at high levels
to join your later experiments.
Choose one that requires the help of many
people from different enterprises in the
company's ecosystem.
With the building blocks, craft hypoth
eses about four to six community segments.
You'll always need to start with the
members of the community, but as long as
yo u have a coherent logic linking the blocks,
the sequence in which you design them
doesn't matter.
in increasing numbers. Still, given the slow progress
and long lead time for development and obtaining
regulatory approval, it may take two or three years
for hard results (in the form of new products) to
materialize.
The fourth experiment added the chief sustain
ability officers and staffs of both BD and the hospitals
to the community. The company (with the help of a
waste management partner) already collected used
syringes from many hospitals and recycled them (in
the manufacture of plastic hospital-waste contain
ers). It also had green programs for reducing waste
and using renewable energies. Now BD is challeng
ing the internal and external sustainability managers
to come up with new ideas for further reducing both
the environmental impact and the likelihood of in
fections from the syringe-disposal process.
Making sustainability experts part of the larger
infection-prevention team is expanding their jobs
beyond their traditional role of enforcing environ
mental regulations and company policies. And help
ing hospitals reduce the costs and risks associated
with syringe disposal further helps BD become the
supplier of choice. Sustainability people at the hos
pital chains have proved eager to engage.
The new communities reinforce the company's standing as a global thought leader in safety issues . . 76 Harvard Business Review April 2013
Getting chief financia! officers of the hospitals to
join the community was the object of the fifth and
final experiment. Beca use it depended on the other
experiments' bearing fruit, it was launched about
a year and a half into the co-creation program. BD
and two large hospital networks are beginning to test
the hypothesis that the co-creation system can help
CFOs negotiate lower insurance rates by proving that
the probability of infections due to injection and
syringe-disposal practices has dropped. Toward that
end, BD and the hospitals are developing a health
economics and risk-modeling tool. BD ultimately
hopes the community members will build a compre
hensive model that helps dramatically reduce the
infection-related costs of the whole ecosystem.
Expanding the Network About six months into the experimentation phase,
BD realized that the proprietary communities within
each hospital chain were established enough for it
to start building cross-hospital communities-for
example, one for infection-prevention and occupa
tional health leaders, and another for the leaders of
sustainability departments. These new communi
ties are growing rapidly and are reinforcing the com
pany's standing as a global thought leader on hospi
tal safety issues.
BD believes that its co-creation program enables
it to forge a special relationship with hospitals. In
many industrywide meetings, such as conferences
where hospitals try to develop new standards for
injection practices, BD is the only medical-device
manufacturer present. It says the co-creation pro
gram has helped it win several new accounts, made
it less reliant on price in competing, and allowed it to
COMMUNITY-POWERED PROBLEM SOLVING HBR.ORG
STEPTHREE Conduct e.xperiments to test the
hypotheses. {6-18 MONTHS)
When approaching externa! partners,
don't pitch your experiments as a pilot;
instead, invite people to be the first mem
bers of the community you're building.
Make it clear that you want their ideas. (lt
wouldn't be co-creation if you were simply
pushing your views on them!)
lnitial platforms typically consist of live
workshops. Since these don't scale up well,
you'll need to progressively replace (or
supplement) them with digital platforms.
Online platforms need not be complicated
or costly. Tap any digital connections you
already have with externa! partners. lf
none exist, inexpensive cloud software will
suit most needs.
After a few months of experiments, in
crease the number of community members
and segments rapidly and tackle problems
of increasing scope. The size and richness
of your community will attract more and
more members to your co-creation system.
Start measuring results to gauge whether
you're reaching your goals for engagement,
the quality of experiences, value created,
and so on.
STEP FOUR Continuously generate new insights
from the data.
lt's critica! for the community to establish
rules about who owns the data and what
information can be shared. You'll also
need to organize the data for use, setting
up structures, tools, and protocols with
your IT department.
As more organizations adopt your plat
form and data accumulate, you can begin
to build models of what practices drive
outcomes.
become a leader in providing sustainability services ing it possible to tackle problems of increasing seo pe.
to hospitals. The number of individuals and organizations that
Sorne questions remain. For example, who owns can be connected is infinite. In the end, firms that
the data being produced? And how will the value build the most vibrant web of human interactions
generated be shared among BD, hospitals, and in- will win the competitive game. lj surance companies? Few hospitals have historically HBR Reprint R1304D
u sed data to define clinical practices. Many of them
have to learn to operate differently to take advantage
ofthe power of the new BD approach.
co-CREATION IS NOT for the fainthearted. It in vol ves
a fundamental transformation of the firm's operat
ing model and needs to start with top management's
commitment. (At BD the en tire senior management
team, from CEO Vince Forlenza and COO Bill Kozy on
down, encouraged the firm's divisions to experiment
with co-creation.) Beca use of its systemic nature,
co-creation cannot be undertaken as an isolated
skunkworks.
Co-creation requires a mix of hard and soft skills.
The ultima te goal is to trigger a chain reaction of win
wins for people and organizations throughout an
ecosystem by generating and acting on data-driven
insights that benefit multiple stakeholders. But few
people are natural leaders who have both strong
analytical skills (which are needed to construct the
data models) and natural empathy (which inspires
the trust required to share intima te experiences and
data). The answer is to assemble a co-creation team
that in eludes people with different skills, sorne pre
dominan U y analytical, others stronger on the en
gagement side.
Co-creation is an evergreen process that even
tually affects all members of a firm and constantly
draws in more and more extemal stakeholders, mak-
1&'1 Francis Gouillart is the president of Experience ta1 Co-Creation Partnership, a management education and consulting firm in Concord, Massachusetts. Douglas Billings is a principal and the head of the co-creation practice at PwC.
"lt was at this point that we agreed to sell our souls."
April 2013 Harvard Business Review 77