Freda: Very good Monday morning. Yes, everyone’s gone back to work. School has started. Traffic has increased. Anyway, we’re talking to Sheila Singam here and we’re talking about a very interesting topic here. Now, here’s we’re going to start off with this. The property company came up with what it considered a revolutionary house design. The architects and marketing team thought would be a hit with buyers. Almost a year after the launch, only 40% of the units have been sold and the CEO was jumping up and down in fury. Now the marketplace has many such stories of new products and services that were launched and failed. And one of the topmost reasons is that the task for innovation is left in the hands of designers who are deemed to be the creative ones in the business. The truth is though that while innovators get really excited about bringing their product ideas to life, they hate the cold wind of reality that is raised by questions about what the customer wants. So these questions are so foundational that if we do not answer them well, we’ll end up making products nobody wants to buy, which is where co-creation comes in. So today, the last Monday of the month, we have Human Equation founder Sheila Singam to discuss How Companies Can Engage In Co-creation For Business Innovation. Of course, this is part of our Tools for Transformation series. Welcome back, Sheila. What is this thing called co-creation?

Sheila: Co-creation is an innovative and collaborative technique where companies invite experts and stakeholders, predominantly their customers or suppliers or whoever has connection with them, to share ideas about its products and services. Now today, the marketplace is evolving so quickly, Freda, and with social media, everyone has become a reviewer and a critic and an expert.

Freda: Everyone’s an expert!

Sheila: Product services and all right?

Freda: Especially behind the keyboard.

Sheila: Correct, and if some of these go viral, and then you have bloggers, they become the influencers. So basically what happens is that consumers have become very involved in the products they buy and if you’re putting things on shelves that are not relevant to them, then the company is going to slowly die—slow to a death. So the purpose of co-creation is to bring the developers and designers of ideas together with the stakeholders—the people who are actually the end-users of the product—so that they can get ideas and come up with more relevant ideas, not just for the evolution of new products and services, but also maybe for marketing ideas. Sometimes if your marketing ideas are not reaching out to the right people, you can go out to people and say, “Give us some fresh ideas.”

Freda: And then sometimes you get the best idea from the accounting team.

Sheila: Exactly.

Freda: Because it’s just like you’re probably running dry and somehow the accountant will say things like, “Eh, never thought of that.”

Sheila: I’m sure if you’ve gone round in the highways, you’ve seen these huge posters with pictures and it’s, “Taken with an iPhone, by so-and-so.” And those pictures speak volumes. I mean, you don’t have to go and do a big marketing spiel to say, “No, iPhone can take fantastic pictures.” Just put those pictures there and everyone goes, “Wow, I can take photos like that, so I want to go and buy.” That’s also, in a sense, co-creation. You’re getting customers involved in talking about your product, in innovation, in marketing your product, and in all aspects of product design and development.

Freda: So what are the benefits of co-creation to companies?

Sheila: Okay, first of all, it allows them to get meaningful insights into what customers want directly from the customers. I mean, when you do market studies and focus groups, you’re just getting sort of maybe a small sampling of people out there. And it might not even be the end-user that you are targeting. But if you use social media platforms and other platforms, right, you’re actually getting direct feedback. And then of course, it provides demographic information. You might have a marketing campaign that’s directed, and then older people might find it really exciting, while the younger people might go, *yawn*. So then you know for that particular product, maybe you need to have another type of marketing campaign to target the young people. Of course, it also enables companies to innovate better in every aspect—from your design, from your supply chain, from your marketing strategy. So you get value-added ideas, and ideas that can add value for the customer. 

You’ll not even just get ideas on the product itself, but it could even be the packaging, the distribution, the sales channels, the quality of the raw materials, so much information that you can get from consumers. 

And also you can get ideas on sustainability. Now today everyone’s becoming a bit more environmentally conscious, and they don’t want to buy products that are not adhering to that. So you can get ideas from your people like, “Hey, how can we make ourselves more sustainable as a business? What can we do in terms of taking care of the environment? What kind of packaging?” So then you can then change and become—adhere more to what people want—and then you actually then win more customers as well. So customers get to create customers and tweak products. 

So instead of you doing testing, and then at the final stage go out and release it to the market and ask people what they want, you can actually get people at the prototype stage itself to come in and say, help to test it or give ideas on how to improve it or what’s not good about it, okay, which then these suggestions can then be evaluated and incorporated into the next version, the next generation. So that it makes the product as close to the customer’s needs as possible. So then you can actually reduce the number of product variants, saving money on your R&D as well.

Freda: Okay, now who should be included in the co-creation process? I think that’s important.

Sheila: Okay, I think that one can be anybody and everybody that you feel might have an interest or is related to your product. For example, you can get the people who review watches, all aspects of the watches, to come on board and give you ideas. You can get customers; you can get the people who are actually selling the watch, who might tell you, “Yeah, you might have a great brand name there, but in terms of your packaging or value-added services, you need to be adding on more.” Of course, the customer’s opinion is crucial here, but it could also be people within your organisation as well, as you well put earlier. Somebody from accounts might have an idea. It doesn’t mean that if he is an accountant his idea is all about finance. It’s very good to have ideas from diverse groups who really might not know anything about your product and the process of development, because they are not limited by design constraints.

Freda: No baggage.

Sheila: No baggage, no preconceived notions, no being kept in the box. So they think outside the box; “But why cannot?” They’ll ask you the question. Leaving you to mull as a designer-developer, “Yeah, actually, why cannot? Why cannot it?”

Freda: Okay, now is co-creation only useful for B2C companies? Can it also work for B2B and small companies?

Sheila: I think it is crucial for every company, actually. Now for B2C companies, usually you will involve more of the end-user, the actual customer who’s going to be buying your products. But for B2B companies, I think it’s very important that if you are, say, a company that’s supplying parts to the automobile industry, it’s very important to get those—those are your customers—to get the people there, maybe the marketing people, the procurement people, the design people from there, to actually come on board and tell you how you can—give you ideas on how you can tweak the product that you’re selling to them, maybe the supply chain, the logistics. Actually, any part of the production, manufacturing, or design of services, at any stage you can use co-creation. You can get people outside. You can do it through the internet, you can do it through a competition, you can invite comments from the public. But then of course you’ve got to be prepared for…

Freda: Brickbats!

Sheila: Brickbats, as well as no ideas. So you cannot be very sensitive if you want to embark on co-creation. Because the first thing that you might have is people slamming you for the products that are already there. Which is why then you tell people, “We’re inviting you because we want to improve and give you what you really want. So help us to do it rather than just slamming us; now we’re letting you give the ideas.”

Freda: I remember years ago, the Coca-Cola story, when they came up with a new formula. There was an uproar because it wasn’t the real thing.

Sheila: Yeah. So they went back to the old thing after that.

Freda: Because the customer still wanted the real thing.

Sheila: Yeah, so sometimes you think you need to innovate for the customer. But with this co-creation process, where you’re tapping into all their intel, so to speak, you find out, “Ah, no, no, we don’t want you to innovate. We want the same old thing because that’s what we’re used to.” So sometimes don’t innovate for the sake of innovating. And when you talk to your customers, you find, “Actually, we don’t need to innovate. We’re just good as we are.” So you don’t have to buy into that whole innovation thing. But sometimes you need to keep up with what the market wants, especially in products and services which are evolving very fast, like telco and handphones and things like that. Speaking of telco, I really do hope that the prices do go down. That would be a wonderful innovation. I hope the minister is listening to this.

Freda: All right, we’ll talk about some examples of companies that have used co-creation to innovate after this. I’m here with Sheila Singam from Human Equation. You’re listening to Enterprise, BFM 89.9.

Commercial break

Freda: You’re listening to Enterprise. Good morning. Freda Liu here in our Tools for Transformation series with Sheila Singam from Human Equation. We’re talking about co-creation for business innovation—something that can be done for companies B2C, B2B, small companies. Some examples of companies that have used co-creation to innovate, Sheila?

Sheila: Okay, one example that comes to mind is DHL. They’re constantly engaging with their customers. They’re constantly engaging with others in the supply chain on how to innovate. One of the things that it did to improve business performance was to get input from customers, especially those who live in sort of remote areas. So you want to go and send a parcel, how lah? To come down from the mountains, go to the nearest parcel place, a brook or a crock. I don’t know whether they’ve got a DHL outlet or what. So that kind of thing, they came up with something called the Parcelcopter. The Parcelcopter is a drone. So this was a research project on using drones to do delivery. So they have tested it actually, where medicines were sent by the Parcelcopter to remote areas in the mountains—to the doctors and medical facilities in remote areas. And we thought that was amazing. So something that takes about half an hour to one hour through mountain roads and forests, it only took about eight minutes. So they are now like developing their third generation of it already. So that came from input from various stakeholders, including customers. Then we have Lego. Lego invites people to post concepts for new play sets. So people will come up with ideas, and then fans vote for their favourite ideas. And they can comment also on the proposals, give feedback on how to tweak it. So LEGO’s executives will choose new products from among the ideas with at least 10,000 votes.

Freda: Wow.

Sheila: So from there, they contact the original creators of those ideas so that they can give input into design and marketing. So I don’t know whether there’s any money traded or anything. But you just imagine the customer loyalty that this brings about. Brand loyalty—they listen to me, I had a hand in developing.

Freda: Imagine how much of it is being shared.

Sheila: Yeah. And then there’s another, Tata—and you know Tata has got diverse businesses. They have a jewellery brand called Tanishq. Okay, so this jewellery brand uses co-creation to invite consumers, customers, to submit ideas for its jewellery lines. And then it offers those with the winning ideas an opportunity to collaborate with the designers directly. I thought that was amazing.

Freda: I didn’t even know they did jewellery as well.

Sheila: That’s why. And then, so this is like from trucks to jewellery, right? So this jewellery—this is for a brand line for young working women. Who would know better than working women what kind of jewellery they want? So they take those ideas and they use it. I’m sure it’s going to sell because it’s coming right from the horse’s mouth, right? And Coca-Cola as well; it uses co-creation to gather content for its marketing campaigns worldwide. So all these companies have understood that any innovation has to be customer-focused. And I think every company out there that exists on the basis of customer satisfaction, providing products and services to customers, had better start listening. I’m just reading in the papers today about a broadcast company that’s going to have a meeting with the minister because it’s not listening to what the consumers want. So I think that you need to really start listening. You might be a giant with a monopoly in the business, but don’t think that just because you have a monopoly anywhere that it’s going to last forever. We have seen giants fall because they’ve not listened to what the people really want; they’ve become irrelevant and outdated. I think you know what I mean?

Freda: Okay, these are good things about co-creation. Any drawbacks?

Sheila: Yeah, there could be. As I said, first of all, you might get the brickbats. And then if you’re very sensitive and your people can’t take the brickbats, then they will say, “Oh, close down the co-creation.” But then, brickbats can also be valuable because they also give you an idea of what people are unhappy with. You don’t always just want to know what people are happy about or what people want. You also need to know what people don’t want so that you don’t build that into whatever you’re producing. So there can be too much dependence on consumer viewpoints or opinions from a certain niche market. So if you want to do co-creation, first of all you’ve got to identify: which market are you targeting in terms of your innovation? And then of course you want to get the maximum of your feedback from there, but you don’t want to neglect or disregard what the other segments are talking about as well. So at some point, your own designers just sit back and say, “Okay, let’s just let the people speak.” And there’s the danger. Now the whole idea of co-creation is that people out there say what they want, but by the end of the day, you are the designer, you’re the developer, you’re the one who has the expertise to develop. So you also need to be able to know what is feasible, what is viable. People come with all kinds of crazy ideas sometimes. You can’t give them a flying carpet. So you need to sort of bring that down to earth—bring the ideas down to earth and make it viable. Another thing is you could have misbehaving customers who could sabotage their effort and turn it into an object of ridicule. You invite them, they come in, and then after that they laugh and make fun of you. Another thing could also be that unscrupulous customers could sell their ideas to competitors. So in that sense, what you need to do is, if you’re engaging people directly and eliciting them to come in for co-creation workshops, maybe you need to get them to sign an NDA so that we know that if ideas go out and you trace the source, then you can take action against them.

Freda: All right, can you give some insight into some co-creation tools that we can use to start with?

Sheila: Well, there are so many. First of all, you can use social media. You can use all the different social media platforms to engage people. You can have competitions where you invite ideas and give people something in return, like what Tata did—asking them to submit ideas and then giving the winning ones the opportunity to work with the designers. So there’s like a business opportunity there, a career opportunity for people. You could do that because people are not going to take the time to come, give you free ideas, enter competition if they’re not going to get anything in return, right? If there’s no prize. Alright, another thing is what I like to use is what I call the Disney creativity strategy. Now this is what Walt Disney did. He would divide his people, his team, into three groups. He would then get one group to be the dreamer, one group to be the realist, and the other group to be the critic. So he put them all in different rooms, and so the dreamer will just come up and dream on whatever ideas—flying elephant lah, and all. So all you see in Disney cartoons today are all people who were the dreamers who came up with it.

Freda: The Edward de Bono’s hats. Thinking hats.

Sheila: Yes, it’s like thinking hats. So you have the dreamer. A dreamer is not to be limited in any way; no holds barred. You dream whatever you want. However crazy the idea, you just take it and then you just list it. And then you have the critic. The critic will come and say, “Aiyo, this one cannot, it’s not feasible,” or whatever. And it has to give a reason as to why. And the realist comes in and says, “But why cannot? I mean if we tweak it here and there—we change the concept, bring it down closer to earth a little bit—can be done.” So I’ve actually used this technique also in creativity, creative thinking, strategic thinking workshops, and then it’s quite amazing because the things that people come out with are so creative compared to when they’re in their work mode in the office—”cannot, HR says cannot.”

Freda: So you make somebody the realist, the dreamer, and okay.

Sheila: Yeah, so what I do is, like if I’m running a workshop, I’ll have three different groups and each group gets to be the dreamer for some idea, and then they will rotate their roles. So it’s amazing because what you are doing is… because if you are a person who is just a dreamer—the kind of fella at work who always got ideas but does not execute—putting you into the realist and critic shoes makes you realise that you need to sit down and come out with some real concrete steps to make it happen. But if you are the critic—always slamming down other people’s ideas, right—put you into the dreamer’s chair, you get a bit stuck because you’re so used to criticising. So we say, “No, no, you have to come out with a dream.” So they’re forced to come out with some idea. When someone critics them, then… So they understand that even when you’re giving criticism, it has to be given in a constructive way. So it’s a good way to use in a co-creation workshop. 

So what can happen is that another thing that I might use is future pacing. Meaning that, okay, you all are here, now you’re customers. How do you see the world in 20 years’ time in terms of food habits? So now you all go to a restaurant, you’ll sit down and eat. And it’s so boring, right, just every time you go to a restaurant, sit and eat. So this is why you had blind dining, dining in the sky, dining in the dark, and then dining in the sky. This came out from people innovating, right? So you just say, in 20 years’ time, the idea of just walking into a restaurant in Bangsar and eating can get a bit boring because been there, done that. How can you make it more exciting for people? What kind of maybe a food trip or a journey for the day, what can you do? So you ask people to come up with these ideas.

Freda: Right. And I think that’s why we have like supper clubs and food trucks and all these sorts of things.

Sheila: Yeah, those are all as a result of what people wanted. Food trucks especially; I don’t know whether they’ve taken off so well in Malaysia yet. I think we all are still so used to sitting at the Gerai Mamak and eating that…

Freda: Yeah, we’re Malaysians, we still like that. We still like that.

Sheila: It might take a while yet. But in terms of food, what kind of food do you see us as having in 20 years’ time? Or it could be anything, it could be cars. So I want those car manufacturers out there who might be listening to this show—I want you to innovate in this way. Why don’t you have a place to keep wet umbrellas in the car?

Freda: Right?

Sheila: Right, you would think.

Freda: Well, at least for women’s handbags, where it’s safe. Yeah, correct. You don’t want to put it on the floor.

Sheila: Or put it in the boot or something. But those wet umbrellas, it’s just very, very surprising to me why till today, no one has come up with a little slot.

Freda: My challenge is that when you get in the car, then you still have to close the umbrella. That’s the part where I get wet (laughing). You recover, but then you’re like, “I can’t close the umbrella with the door closed.” So the moment you close the umbrella, the rain’s gonna get to you and the door’s still open.

Sheila: And then after that, when you keep the wet umbrella, the whole car… they should have a little slot which drains out the water, something. Come talk to me (laughing).

Freda: Okay. In the current transition government agencies, can co-creation be used for government to remain relevant to the rakyat? Actually, I’ve got something here but you talk first.

Sheila: I think definitely there needs to be the case. Now we’ve got a new government in place. Many of our new ministers have never been ministers before. I mean, I’m very, very sure they are all fully qualified for the job, but they also will have to rely on their staff—their DGs and their senior officials—to come in and give them knowledge about the ministries. Now many of these people are entrenched in old ways. They’re all thinking in the box, right? So why shouldn’t the new government, which has inherited a heap of problems, avail of its very educated, opinionated rakyat that put them there in the first place? There’s a whole heap of very intelligent people out there. 

Everyone thought that only the cities—places with big cities—are going to be swept away, and the people in the rural areas… they are also very clued in: “Hello, everyone’s got internet today.” Pakcik, who cannot speak English so well and didn’t go to school, also now knows how to go and get information on the internet globally. So you can actually start co-creation by having people to come in—at least have channels for information. I just had someone say that they were trying to get to a ministry; they emailed, they tried to call, they couldn’t get any response. That should not be the case today. I think immediately, it’s been like what, one and a half months already, ministries should already have these channels—multiple channels—whereby people can go in and give ideas. And they should actually have someone constantly, 24/7, looking in at these ideas and channelling the more viable ones back.

Freda: Which is what I was thinking. Even setting up a website, right? A website where the challenge… to point out whatever the challenge, or the ruling government can say, “This is a particular challenge,” and only people can respond with possible solutions can write in, right? Or you can say, “This is my challenge, this is a possible solution.” And the thing is, I don’t need the challenge itself. I think we all know what the challenges are and there’s been a lot of noise of people complaining, keyboard warriors, etc. So unless you have a complaint and you have a possible solution, then write in.

Sheila: Absolutely.

Freda: So then that will be part of the… then I’m sure they’ll be able to look at it and with the solution, because everybody can complain.

Sheila: You’re so right. I mean, one of the things that I attended a few weeks ago was a town hall session that was mooted by the Minister of Human Resources with HRDF. And I thought that that was an absolutely fantastic idea because, first, he got to listen to all the ways in which the organisation should improve. So I think co-creation is a fantastic way for the government to harvest the ideas. Listen, this is a government by the people, okay? It’s by the people, for the people. So definitely, if they want to be sustainable, they want to be there for the term, they want to be pleasing the people who put them in place, they need to be listening to the people.

Freda: I agree, but also at the same time, the people also need to complain with solutions.

Sheila: People also have to understand our part. Yes, they are a new government, okay; we want transparency, but they are not perfect. Imagine if you were thrown into a new role, you’d also be finding your way. That involves the country. So please, let’s give constructive feedback.

Freda: With solutions.

Sheila: With solutions. Absolutely.

Freda: Alright, so co-creation for business innovation and running in the government.

Sheila: Yeah, I’m really happy people call on me to come and facilitate these sessions. I love sessions like this.

Freda: Thanks for being with us. We’ll see you at the end of next month. Again, that’s Sheila Singam from Human Equation. This is our Tools for Transformation series. We’ve been talking about co-creation for business innovation. You’ve been listening to Enterprise, BFM 89.9.