How User Innovations Become Commercial Products: A Theoretical Investigation and Case Study

In this paper we model the pathways commonly traversed as user innovations are transformed into commercial products. First, one or more users recognize a new set of design possibilities and begin to innovate. They then join into communities, motivated by the increased efficiency of collective innovation. User-manufacturers then emerge, using high variable cost / low-capital production methods. Finally, as user innovation slows, the market stabilizes enough for high-capital, low variable cost manufacturing to enter. We test the model against the history of the rodeo kayak industry and find it supported. We discuss implications for “dominant design” theory and for innovation practice. * Harvard Business School, Boston, MA, [email protected] ** Department of Entrepreneurship and Innovation, Vienna University of Economics and Business Administration, [email protected] *** MIT Sloan School of Management, Cambridge, MA, [email protected] Acknowledgements: First, we would like to thank the editor, Fumio Kodama, and three anonymous reviewers whose comments led to significant improvements in the paper. We also very much appreciate the insights of Joachim Henkel and Jason Woodard on the structure of our models and those of Sonali Shah and Christopher Lettl on our empirical findings. Finally, we benefited greatly from comments provided by participants in the 2005 MIT User Innovation Workshop.