Decision-makers’ underestimation of user innovation

Abstract

In the past few decades, much research has documented the importance of users as sources of innovations. Over the last 10 years, Research Policy alone has published 56 research articles investigating this phenomenon. We ask to what degree the findings of users as innovators have been absorbed by decision-makers responsible for new product development (managers) and by those who shape the contextual conditions for innovation (policy makers and public administration). A realistic perception of the sources of innovation is important as it constitutes the basis for a rational allocation of resources and thus indirectly impacts the innovation performance of companies and societies at large.In a large-scale survey of n = 1500 decision-makers, we found support for a substantial underestimation of users as a source of innovation: While the true proportion of user innovation among the most valuable 1678 innovations in nine industries is 54.4% (as established in existing research articles), decision-makers estimate it to be 21.7%. A content analysis of transfer media (450 academic textbooks, popular innovation books, and business articles) underscores this theory-practice gap: Of 3469 text paragraphs dealing with the sources of innovation, only 2.7% mention users as innovators. We develop six propositions on the reasons for and consequences of this underestimation that may serve as a starting point for future research and practical consequences.