The creation of knowledge, products and services through the online community of enterprises and consumers is still in the beginning.

Its prospects are not yet known.

Jacques Bughin, Michael Chui, and Brad Johnson2008 in July, for most enterprises, innovation is a proprietary activity, which is basically carried out within the organization according to the strict deployment steps.

However, over the past ten years, some companies in the consumer, fashion and technology industries have been opening their product development processes to new ideas from outside, such as new ideas from suppliers, independent inventors and university laboratories.

Many executives of enterprises are considering what measures should be taken to make the innovation trend more open 1.

On the one hand, they are considering how to delegate innovation management to supplier networks and independent experts to design products and services through interaction.

On the other hand, they also want customers to join in.

If an enterprise can use technology to enable these external personnel to participate in R & D projects, will it be able to get better new product ideas and become more realistic and more economical in comparison with what can be done today?

For example, suppose a wireless operator wants to organize the design of a new generation of mobile devices. It organizes the interested customers, software engineers and component suppliers through an open network to enable them to interact and collaborate with one another.

This is the innovative mode of bringing together like-minded forces.

Now, more and more organizations are starting to adopt this mode: its term is distributed and co created, using its technical name.

For example, Lego (LEGO) has successfully invited customers to make suggestions for new products through interactive ways, and those who have put forward the idea of meeting market needs have received material rewards.

Shirt retailer Threadless's products are sold online and are currently retailing in a physical store in Chicago.

These goods are designed through interaction with the customer group of the company.

In the software industry, open source platforms developed by "distributed co creation", such as "LAMP" stack (for Linux, Apache, MySQL and PHP/Perl/Python), have become the standard components of IT infrastructure for many companies.

The emergence of network as a sharing platform has promoted the development of this new mode of innovation.

The driving force for more and more enterprises to adopt this approach is the ever increasing demand for more good product ideas and faster and better use of these ideas.

For us, "distributed co creation" is a very new concept. Therefore, there is no definitive conclusion as to whether an enterprise should implement it and how to implement it.

However, our research on online communities and the survey of multiple open innovation pioneers show that for executives, it is time to seriously study the possibility of "distributed co creation" and understand the challenges that can be faced when adopting this model, such as ownership of intellectual property rights and increased operational risks.

The new and innovative faces of the company are in almost every industry, and many of them eventually become products of creativity and technology from a number of participants in the value chain.

Although Boeing designs aircraft, many components on the aircraft are made by suppliers, and they have intellectual property rights.

Similarly, hundreds of parts of Hewlett-Packard Co's computer and Apple Corp's iPod are invented and manufactured by dozens of countries.

In many industries, suppliers know more about the technology and manufacturability of the components provided by the manufacturer than OEM.

Eli Lilly licenses and sells products that are developed by other companies. The giants of the high-tech and media industries are always concerned about the innovation of the emerging enterprises, and try to get all the innovations that seem promising.

At present, the advantages of specialization and collaboration are obvious.

Obviously, compared with vehicle manufacturers, suppliers of automobile manufacturers can produce better headlights at lower cost, because specialization can promote focus and innovation.

Many companies form joint ventures for the needs of individual products or marketing portfolios, and collaborate with university laboratories or experts.

Companies are increasingly willing to listen to the insights and ideas from various sources, especially their customers, through telephone customer service centers, retail data and focus groups.

Collaboration is reflected in many aspects: many enterprises will consult contract experts and suppliers when developing new products, and allow customers to participate in testing product prototypes.

However, Wikipedia (Wikipedia) has a unique way of collaboration. This online encyclopedia represents a real phenomenon in the Internet.

Wikipedia was created entirely by its users instead of by a research and development team of a company in California.

This is a dynamic global reference book, which has been continuously increasing content. In less than seven years, it has about 6000000 articles 2 in more than 250 languages.

The example of Wikipedia is that by giving more decisions on product content to different networks made up of suppliers and / or customers, and allowing them to interact with each other, enterprises can gain greater benefits from specialization.

Does this seem far fetched?

IBM obviously does not think so: it has adopted an open source operating system Linux in some computer products and systems, and has utilized a core code base, which is constantly improved and enhanced by a large global software developer community. Only a small proportion of them are employees of IBM company.

In the software industry, open source software is becoming more and more popular, thus making the profit and market share of proprietary software brands declining.

There are many other examples of "co creation".

Participatory marketing is one of them, which encourages customers to help plan marketing activities. Sometimes, this is not only a new tactic to attract attention.

If it works well, this is also an opportunity to start creating products with customers.

For example, Peugeot Co invited people to submit their designs on the Internet last year, and the company website attracted 4 million of the web page visits.

The company built a prototype car based on the winning design, exhibited it in car marketing activities, and collaborated with software developers to put the car in video games.

Even B2B companies are starting to co create activities with customers: SugarCRM invites CRM software users to customize the software to meet specific requirements in their industry.

There are three ways to achieve success in a company by adopting a "distributed co creation" approach.

First of all, enterprises can learn from Lego and Threadless to gain value from the products or services created jointly by promoting the good ideas collected from the Internet.

In Korea, the co created cosmetics brand Missha has taken up 40% of its market share.

Secondly, enterprises can obtain value by providing complementary products or services.

For example, Red Hat sells technical services to Linux users in large quantities.

Third, enterprises can benefit indirectly from the process of CO creation, such as enhancing brand position or corporate strategic status through co creation.

Although the "distributed co creation" seems to have a bright future, the answer is not yet clear about what kind of capability the enterprise needs or how to organize these capabilities to achieve the best use of this innovation mode.

As enterprises gradually accumulate experience in various open innovation models such as "distributed co creation", many answers will become clearer.

But some of the challenges are now obvious.

To attract and motivate co creators, the company needs to provide appropriate incentives to the appropriate participants, so they need to know what the talented contributors are concerned about in community interaction.

Sometimes, material incentives may be needed, but the enthusiasm of other participants may be encouraged by mechanisms such as community identity.

Enterprises must also identify obstacles that affect people's enthusiasm for participation, such as the difficulty and the time required to make contributions, and then take measures to eliminate all problems as far as possible.

In addition, enterprises may need to carefully design some programmes to induce participants to participate from a low level to a high level.

For example, Wikipedia now has 500 part-time administrators who are privileged to prevent others from editing certain articles, usually in order to prevent malicious destruction of these articles by some people.

In order to allow many contributors to participate effectively in a co created community, we must decompose the problem so that contributors can handle different parts of a problem in parallel.

Otherwise, it is impossible for a large number of participants to make effective co creation.

For example, a global team of more than 2000 scientists participated in the design of the ATLAS particle detector, which is a complex scientific instrument for detecting and measuring sub atomic particles in high-energy physics.

This work is broken down into many different components and distributed to 165 working groups, which work collaboratively through Internet based tools 3.

The governance mechanism for promoting co creation is a community that can produce results if there are clear rules, clear leadership and pparent processes for setting goals and resolving conflicts among members.

For example, in early 1990s, sun computer systems and a global software developer community worked together to develop the Solaris operating system.

Sun computer systems has established a management committee, of which two members are employees and another member is from the larger software community, which is responsible for loose supervision over the progress of the project.

Even then, the software community also asked sun computer systems to give up more control.

The leadership must also adhere to a cohesive vision, because there are always community members' "fork in the road" to use the company's intellectual property rights to develop the risks of products or services that they create.

The network application suite Mozilla distributed by the Mozilla foundation is the 4 created by a software community.

When developing these programs, two participating engineers were dissatisfied with the development direction of the project, so they used the code of Mozilla to create a Firefox browser.

Finally, the leader of the software community identified it as the primary support browser.

A lot of CO creative online communities believe that "group" 5 knows more than individuals, so it can create better products. As open source software expert Eric S. Raymond said, "enough eyes can make all problems stand out."

6 although it is still too early to say that this idea is suitable for all types of products, more and more people agree that at least in the field of software development, "distributed co creation" is the guarantee of quality.

For example, in a study published in 2000, European Journal of Information Systems said: "the quality of open source software is often better than commercial proprietary software."

7 in addition, a study published in the December 2005 issue of the journal Science Nature concluded that the scientific entries in Wikipedia are basically as accurate as the scientific entries in the Encyclopedia Britannica 8.

However, there are doubts about the conclusions and the accuracy or opinion of the items that rely on these conclusions.

Some products jointly created by the company have crossed the quality threshold and have been widely adopted.

A survey by Netcraft, an Internet research firm, shows that the co created open source Web server program Apache runs on more than half of the websites; 80% of the most reliable Internet hosting companies run Linux.

Although it is difficult to prove that the products of CO creation are generally of high quality, enterprises are increasingly willing to use such products for key business processes.

It is too early to develop a useful framework for successful co creation, but these frameworks will undoubtedly emerge in the coming years.

At the same time, consumers and professionals online communities provide us with some experience on how to create together.

Some of these experiences are from participatory media.

Our research shows that in today's Western Europe, 25% of Internet users publish comments and views on various consumer products online.

Visitors and participants of original user media websites increase by 100% annually, while the growth rate of traditional websites may be only 20% to 30%.

These figures indicate that people are more and more willing to interact with enterprises on the Internet, and businesses are now taking advantage of this.