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Success or Failure - How's Your Power of Pull?

Guest Author Blog: Three Companies That Harness the Power of Pull by John Hagel III, John Seely Brown, and Lang Davison authors of "The Power of Pull, How Small Moves, Smartly Made, Can Set Big Things in Motion."

How can a company attract everyone it needs to get a complicated new product developed and adopted quickly?

Bottom line: What makes one company flourish while others flail?

The common dynamic that we see underlying many success stories is what we call “pull.”

It’s the ability to draw out people and resources as needed to address opportunities and challenges. Pull gives us unprecedented access to what we need, when we need it, even if we’re not quite sure that “it” is.

Guest Author Blog
Guest Author Blog

We explore these ideas more fully in our new book, The Power of Pull.

Push approaches begin with a forecast of needs, and then design the most efficient systems to ensure that the right people and resources are available at the right time and the right place using carefully scripted and standardized processes.

Pull-based approaches, on the other hand, deploy what we call pull platforms to help a group of specialized and geographically dispersed people to come together and innovate in response to unanticipated events. Instead of dealing with uncertainty through tighter control, pull platforms do the opposite: They seek to expand the opportunity for creativity in dealing with complex business problems.

SAP builds a scalable pull platform

Anybody who’s worked in a big company knows how hard it can be to find “the right someone” on short notice to help you solve a pressing business-innovation problem. As Lew Platt, the former CEO of Hewlett Packard , famously observed, “If HP knew what HP knows, we would be three times as profitable.”

But three big companies have begun to figure out how to build these large-scale pull platforms to create value for customers: SAP, Cisco, and Eli Lilly. They’ve built scalable networks to access capabilities beyond their organizational boundaries. In the process, they’ve driven sustainable long-term results.

Founded 25 years ago by a group of former IBM engineers, SAP has grown to become the fourth-largest software company in the world, creating the big company-wide software applications that today’s firms use to run most of what they do. Nearly a decade ago, the software industry started to go through a wrenching change as it moved from large, complicated, tightly integrated applications to much more loosely coupled modules of software embedded in service-oriented architectures. As a response, SAP introduced its NetWeaver platform in early 2003—a nifty piece of software that helps SAP applications talk to each other and to other programs.

In so doing, however, SAP ran into a classic chicken-and-egg dilemma: The product’s full potential wouldn’t become apparent until customers began using it and discovering what it could do. Yet customers might not adopt NetWeaver until they could grasp its potential. A solution wasn’t simple, as SAP had neither the reach nor the resources to train and teach its entire customer base about NetWeaver—let alone educate tens of thousands of systems integrator consultants.

That’s when SAP executives came up with a great idea: Why not let all of SAP’s customers, systems integrators, and independent service vendors teach each other about NetWeaver, peer-to-peer, as they learned to use it? The result was the SAP Developer Network (SDN), a broad ecosystem of participants interacting in discussion forums, wikis, videos, and blogs.

In one fell swoop, SAP accessed a global network of talented and passionate people who proved to be crucial to the platform’s success. SAP’s Developer Network and its related initiatives have created a rich environment of more than 2 million participants contributing to millions of separate threads of conversation.

The SDN was a success in no small part because it provided ample opportunity for nearly everyone involved to become more productive in what they do. Independent software developers could improve their coding chops. SAP’s in-house code-writers could learn more quickly which of the features they wrote worked for their users—and which did not. And SAP itself could get a lot more value from its customer-service people.

Over time participants started to develop reputations on the network, and as relationships grew, they formed teams to tackle new software problems. The network became more than a way for the company to answer questions about what it was already doing. It grew into a platform to identify new opportunities, collaborate, and get better faster.

Pull platforms emerge at Cisco and InnoCentive

Pull platforms don’t exclusively live on digital networks, although they function most effectively there. They can also bridge the physical and virtual worlds. Cisco and InnoCentive show how.

Cisco’s pull platform, introduced as Cisco Connection Online before it went through a series of evolutions, evaluates customers’ needs and then connects them with more than 40,000 specialized channel partners to get more value from the networking equipment they purchase. By developing a detailed understanding of customers and diverse providers, Cisco can offer advice tailored to individuals. And Cisco goes beyond a simple introduction to partners, orchestrating the entire sequence of activities a customer requires, from consulting and training to implementation and customization.

Meanwhile, InnoCentive illustrates how a well-known open-innovation platform has evolved beyond its original boundaries. Many people have heard about how InnoCentive was spun out from Eli Lilly in 2001 as a way to exploit the power of the Internet in discovering solutions to challenging research problems (Click here for more about InnoCentive). The platform is designed to help connect Seekers, organizations that have difficult research problems, with Solvers, individuals who come up with creative solutions to these problems.

But what few people realize about InnoCentive is its transformation from a pure transaction site—problem posted, solution proposed, payment made, end of story—to one where teams are becoming more central to the solution space. Even on a platform initially designed to support individual problem-solvers, teams began to form to increase the probability of success. InnoCentive learned that about 10 percent of Solvers were relying on academic labs or broader research teams to address problems.

This led InnoCentive’s management team to launch a major new initiative to support and encourage teamwork. In March 2010, InnoCentive launched shared workspaces for teams and created governance structures to effectively manage their intellectual property issues. Its Prodigy feature also enables Solvers working on certain types of challenges to instantly compare the accuracy of their solution with those of other Solvers. More features to help teams connect with each other are in the works, because the site recognizes that these sustained relationships are increasing the creativity and productivity of the solutions proposed.

As these examples show, pull platforms offer the ability to find and connect with people, products, and knowledge on an as-needed basis to address unanticipated market demands. As game-changing disruptions become ever more frequent, this capability will grow increasingly central to our survival, much less our success.

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John Hagel III, John Seely Brown, and Lang Davison of the Deloitte Center for the Edge have a passion for communicating world-changing ideas in ways that get executives to change what they do and realize significant performance benefits.

Their books include The Power of Pull, The Only Sustainable Edge, Out of the Box, Net Worth, and Net Gain.

Email me at bullishonbooks@cnbc.comAnd follow me on Twitter @BullishonBooks

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