I rarely meet a major business that doesn't declare they're customer-driven or, at least, increasingly customer-driven. The nuance usually speaks volumes. In practice, very few can manage, or even afford, to be entirely driven by what customers would want. Especially if you're in a consumer market, the demand doesn't exist, really. It's all about the demands (plural).
Pipelines in disguise
It gets worse when addressing innovation.
In that matter, beyond what is nice to say to the media and stakeholders, no one can afford to be fully customer-driven. It would entail spreading thin and embracing a long tail of requests, many of which contradictories, most of them evolving so rapidly that any innovation project based on them today would look absurd when arriving on the market. If in doubt, check how some corporate incubators are still working on NFT while missing out on ChatGPT. Not to mention that on many issues no, customers mostly don't know what they want three years down the road.
How could they when the market, society, and the global economy are in so many turmoils on a regular basis?
I'll mostly skip my usual rant about innovation methodologies and how they are, at best, trying to pipeline your best ideas from three to five years ago in a market that doesn't care anymore.
Still, if we step back, something is striking when considering the current hodgepodge of design thinking and lean startup that we have lazily copied and pasted all around. It always assumes one thing: there will always be enough customers at a critical and central step to have a clear opinion about our project. And as such, they will somehow have the final cut about how we innovate.
And I'm not saying this assumption doesn't work.
It works sometimes...
Customers can have an opinion
If the problem you want to solve as an innovator is already widespread and quite painful, customers are already suffering from it at scale and with enough acuity that they will have an informed opinion about it. Not a scientific or metaphysical one, but practical and experiential.
Problems that are so obvious and critical that customers do have a clear opinion about them are defined in a particular innovation space. Which one? The one where there are already enough early customers to interact with (i.e., innovators and early adopters):
This innovation space is all about mining opportunities that are already well on your customers' radar. Go crazy with lean startup and design thinking, and in some cases, yes, even pipelines!
Mining below customers' radar
But past this value space, the more you push for innovation on your market side, the more you'll have to work on unexpressed needs and, at some point, needs that don't exist yet.
We are speaking of an entire value space dealing with problems that are not at the same time both critical and in full customer awareness:
This value space is not "the best" or "the worst," mind you. It's just different. It's also qualitatively very rich and diverse in the way it deals with technological (economic, industrial) and market (societal, political, legal, environmental) risks.
There's also a tremendously important thing about innovation: the more an innovation seems far away (, the less the market appears to have a problem to deal with), the bigger the payoff if, against all odds, you do change the market. Cue in the portfolio logic where innovation projects are strategically spread with different ratios of risk/reward...
This core distinction between the problems to be solved for the market and the innovation value spaces where customers know what they want or not is tremendously important for the aforementioned reasons. But also because it should help you decide how you will use different strategies, tools, and teams to cover a nuanced map of innovation.
Confusing tools for methodologies
Pointing out these very important nuances, I understand I often sound like I despise tools like lean startup or design thinking.
My crux is that they are just that. Tools. Not methodologies. This confusion is willfully sustained by many of us (consultants, trainers, corporates) as it seems to make the innovation field easier to deal with while it only masks its inherent richness.
With all this laid out, knowing when you need to listen to your customers very carefully and cycle ideas and projects through them and when you need to commit to not listening to them to begin with should be clearer. If so, you might even develop serious doubts about companies bragging about being fully and only customer-driven. Not listening to your customers does pay off 😁