In the world of products, suppliers develop specifications to describe the product to potential customers. Customers can compare specifications of alternative product options to find the right product for their needs. Suppliers need not know exactly what the customer intends to do with the product, so long as those products meet the specs. In many cases, the resulting spec is one that averages out the input from a variety of different customers, such that no one customer is offered exactly what he or she asked for, but instead must be content with those specs that are common to other customers as well. In the world of services, it is much harder to develop specifications than it is in the world of products. Suppliers in turn can no longer dedicate themselves to long production runs and one-size-fits-all thinking to serve these customers. Instead they have to figure out how to give the customer what the customer needs, while also figuring out a way to do this profitably for themselves.

When customers tell you, rather than everyone else, their tacit needs, you have a unique insight that can help you differentiate yourself in the market. When customers use your systems in ways that they don’t use other systems, you have the opportunity to learn from what your customers do that can confer advantage on your business as well. Companies can do more to involve customers in their innovation processes than simply watch them. Some companies, like Lego, headquartered in Denmark, have had great success in letting customers create designs that they would like Lego to produce. Another way for services companies to focus on customers is to create a visualization of the customer’s experience. This visualization makes it much easier to spot the root causes of problems and identify way to improve the service.

For more information, see Ch. 1 Open Services Innovation by Henry Chesbrough