Back in 2006, when I was just completing my book, Outside Innovation, I recall talking with Sean Belka, an SVP from Fidelity about my findings. One of the off-hand comments I made at the time galvanized Sean. I said something to the effect that the most profitable companies will be the ones with the smartest customers. When I noticed his suddenly attentive body language, I went on to explain that what I meant was that the companies that do the best job of nurturing and harnessing their smartest customers' intelligence will have an unfair advantage over their competitors. Sean really liked that idea. That's because Fidelity's customers are pretty smart. Later, I realized how profound this idea actually is.

Customers' Intelligence

Notice that I'm not talking about CI (Customer Intelligence)--that which you learn about your consumer or business customers from spying on them and running analytics on their behavior. I'm talking about your customers' own intelligence: their thinking, their insights, gaining intel and insights from the IDEAS they freely share with you.

Common Mistakes

Companies Assume Customers Don't Notice.  So many companies base their business models on duping their customers and hoping that they're too dumb to notice. I can recall countless discussions at hundreds of companies in which the execs didn't see, or wouldn't admit that they knew, that their modus operandi of charging premium prices and hoarding valuable information about customers' operations was predicated on the assumption that their customers were too dumb to figure this out.

Companies Gather Intelligence ABOUT Customers but Don't Share it WITH their Customers. I've been in so many customer co-design meetings in which the customers unanimously said: "we want to see the information you have about our aggregated operations and about how each of us is doing compared to others who are like us." And, the execs just scratched their heads in disbelief. Why would any customer want his/her proprietary information aggregated and shared with their peers and competitors? Isn't it better if WE pull all that information together and SELL it back to you after anonymizing it and adding value? No, the customers would say. It's OUR data. 

Most Companies Don't Leverage Their Customers' Willingness to Share Insights & Solutions with One Another. Why do so many companies assume that their experts are smarter than their customers? There are wonderful exceptions to this sad misapprehension. National Instruments is one company I've written about over the years that has always valued their customers' contributions to the ecosystem of knowledge surrounding their products. Many open source companies' are also designed to leverage smart customers' contributions.

Profiting from Your Smart Customers

Let Your Customers' Insights BE Your Products & Services. Maybe 2016 is the year in which businesses will finally realize that their smartest, most insightful customers actually want to strut their stuff. They want to compare notes. They want to learn together and evolve their understanding together. Even if you have customers who are competitors, there are many pre-competitive arenas in which arch-rivals are delighted to compare notes and to learn from one another. For example, my "smart customers" group--Patty's Pioneers--has been in continuous existence since 1989. These customers not only shape our published research, they now produce much of it.

Here are some hard-learned lessons about harnessing your customers' intelligence that I urge you to share with your colleagues:

1. Bring your smartest customers together face-to-face at least twice a year.
2. Let them talk with one another about their hot buttons, issues, and insights.
3. Listen deeply to what they've discovered and what they need.
4. Share your learnings with them and let them correct your misapprehensions.
5. Create an easy way for them to continue to dialogue with one another, with your team as "flies on the wall." (This takes trust.)
6. Encourage them to strut their stuff, so you can benefit from their insights, discoveries and innovations.
7. Cherish the patterns they show you about what works for them, and what's valuable to them.
8. Run around in front of their parade--commercialize their improvisations (with their enthusiastic consent).
9. Engage with them in co-designing your next generation solutions.
10. Embed your "smart customer strategy" into your corporate culture.