Ning: A Bionomic versus Command-and-Control approach to technology development

I'm divided on this. On the one had, getting the customer to help drive innovation is a brilliant strategy that Google and others have mastered. On the other hand, this might be the dreaded dot-com business plan of "invent something cool then hope you can find a way to productize it". If they've got a business plan, they're golden. If their business plan is to wait for customers to innovate for them, then I don't hold out much hope.

Posted by TonyD on October 10, 2005 12:06 PM | Permalink to Comment

Good point. You need to have a product that provides consumer value first. But the idea that is important here is that the company doesn't assume it will come up with most of the best ideas on how to build the product. It allows outside ideas to be proved by the market without requiring that the company approve them first. This is a faster process which generates more ideas cheaply, and allows consumers to decide what they find most useful.

Posted by Leigh Marriner on October 10, 2005 01:44 PM | Permalink to Comment

Leigh, you might be interested in taking a look at JotSpot. It is a wiki-based development platform that shares a lot of the same business philosophy as Ning.

While Jot has a subscription business model, they have a "you own your own data" policy as well as an open approach that encourages developers to share their code with one another (they've just set up a sandbox wiki for their developer-users, in fact, to facilitate that process). They are different from other wiki-based products in the same way that Ning is different from other social software products--they are providing a platform for people to create their own solutions, rather than forcing a solution down consumers' throats.

Companies employing this kind of approach to product development do have to be careful they walk the line between providing opportunities for user innovation and exploiting free labor. So far, both companies mentioned here have done that quite well. I have no doubt that many companies will seek to cynically exploit the trend, but they will fail, because you can't fake this kind of thing.

The critical factor for the success of this model is earning--and retaining--the trust of your prosumers.

With Jot or Ning or similar companies, the distinction between "developer" and "user" communities don't exist. This requires a very different communication style and corporate value system from traditional business.

It is a bit more like pure vs. applied scientific research; the payback is not clear, not immediate, and not ensured, but for those companies that pursue it, the rewards can be tremendous. You have to trust the wisdom of the masses, which is something old-school companies find hard to do.

Companies that utilize this approach most effectively are those that see what they do as empowering people with tools and services so we can make the things we need, as opposed to selling products to consumers based on what they decided we need.

Both Ning and Jot have taken the approach that they will earn our business, and earn the right to keep our business, rather than trying to lock us into proprietary solutions and trap us into legacy investments. Making data and content portable is a deliberate decision by a company to continually challenge itself and its people to serve their customers. I think that is a good thing.

Posted by galiel on October 26, 2005 08:08 PM | Permalink to Comment

In some ways the approach that JotSpot and Ning have taken is akin to the Open Source movement or blogs. It's hard to understand, for those who are used to the traditional business model of a company owning source code and selling a product that attempts to predict and meet all needs. It's hard to believe that letting unknown individuals run off and create what they want can result in a product that works well and doesn't have gaps that make it untenable. It's easy to understand why the Soviet Union's central planners felt they had to plan the economy and allocate resources in order to make sure they had enough steel and wheat - how likely was it that they would have enough if no one was paying attention? We know the free market works, because we live in it and can see the results. But it is a leap of faith that is hard to apply to individual products and services. Even as an American in the early 1970s, I worked with an economics team under Nobel Laureate Vasily Leontief building a unified input-output model of the US economy that attempted to predict what might happen if the mix of inputs (workers, iron, gas, etc.) changed. A bottoms-up approach to software development allows energy to be put into trying out new solutions that customers want and abandoning them quickly if they don't fly, rather than trapping us into working on the next feature on the list for release 3.0, which was determined way back last year.

Posted by Leigh Marriner on October 27, 2005 07:41 AM | Permalink to Comment