Does involving customers in your business really lead to innovation?

Mario. Not Designed By Customers
It’s been interesting reading the Steve Jobs quotes circulating around the internet. The one that struck me most was this one:
“It’s really hard to design products by focus groups. A lot of times, people don’t know what they want until you show it to them.”
This is almost completely at odds with the thinking in the sector I work in . A typical view runs like this (taken from our trade magazine Inside Housing last week):
 “Where residents are at the heart of decision making – that leads to better services / higher satisfaction levels” 
This has been hammered home by years of regulation where the conventional wisdom has been that you shouldn’t make a decision unless there is a real life customer sitting next to you.
But Steve Jobs isn’t alone in his belief that customers can’t imagine the future. Shigeru Miyamoto of Nintendo has been at the helm of some of the greatest innovations in Video gaming – but does not use focus groups or listen to customers – in the conventional sense at least.
Where do I stand on this?
First of all it’s nonsense to believe that getting a handful of random customers together in a room ( which is what most housing associations actually do) is going to help you improve your service. If managers need customers to help them run the business then arguably they shouldn’t  be managers in the first place.
But on the other hand examples like Jobs and Miyamoto are very rare. They rely on having a unique creative force directly at the helm – capable of not just judging the public mood but telling them what they are going to like in the future. Witness the general public scepticism, ridicule even, when the iPad and Wii were first announced.
There is another way. Co-creation.  Where the customer and the company jointly create products and experiences that are meaningful and profitable to both.
We are working on a couple of projects at the moment where the concept of co-creation is being deployed.
Engaging customers in the development of a new service offer, adapting that service offer based upon personal preferences/circumstances and then offering the customer a range of products/experiences where they have freedom of choice.
I’ll be updating the blog in a couple of days about the process we went through to come up with a “customer deal” .But I’d be really interested in hearing from others on how you are improving customer experience. 

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