**3. Preliminary theoretical understanding through literature review**

Theoretical themes included uncertainty of innovation, user-centered innovation, and userstudy methods. In addition, it was examined what kind of smart jewelry is already on the market. In 2013, there were still very few jewelry for sale, but innovation and development work seemed to be in quite a many places in progress.

innovation throughout the innovation process. On the other hand, users can be grouped to

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Innovation is born when a company meets the conscious or unconscious needs of the customers. Majority of the customers cannot say what they need before seeing and even experiencing a solution. Unconscious needs often come up only through product or service experiences. This may take place, for example, by providing a prototype for the customers to test use. Customers can be divided into innovators, early adopters, early majority, late majority, and skeptics. Innovators and early adopters are called lead users. Compared to the designers who are good at solving defined problems, the lead users or fans are need experts who have insider knowledge. They can identify previously unknown customer needs. When they bring their need expertise in order to connect it with a designer's solution expertise, new solutions can become blockbusters. Lead users often help designers further customize and fit a product into users' everyday life. The innovators are the kind of lead users who innovate on their own initiative. The early adopters, on the other hand, are more like codesigners. Critical point is between the early adopters and the early majority. Most innovations die in this chasm [9, 12, 15–20].

The essential thing in creating new products for new markets is to challenge the current market definition and create a new one; in this case, challenge the definition of traditional jewelry and create a new one for smart jewelry. Creating a new market definition is based on an indepth understanding of the users. For this reason, it is necessary to consider what designers know in advance, and which questions can only be answered through collaboration with customers and other partners. For this, variety of user-study methods can be utilized such as user participation, prototypes, experiments, observation, and interviews (**Figure 2**). On the basis of the user research problem, the most suitable method classes and single methods within them are utilized. The use of different methods may take place simultaneously (e.g. observation and interview) or sequentially, such as making first prototypes and then testing them. Choosing the method and knowing how to use it are essential skills when carrying out

In the user-centered innovation, qualitative research methods are utilized instead of or in addition to traditional market surveys. The aim is to get caught up on the users' experiential relationship to a product. This approach is a key to getting an idea of a variety of product use cases and finding the core value of product. It is critical to understand user goals and motives through the meanings. User understanding can be structured through user profiles that refer to a variety of ways to use the product, as well as attitudes toward the product. Users can be placed in different categories, such as doubtful, familiar, seeker, etc. Creation of a user profile can start from only one customer by understanding his life profoundly. After this, the profile

• for the user: company creates a solution based on knowledge about users' needs,

three groups according to how active they are:

**3.3. User-study methods**

user research [17, 21–23].

may reflect a larger crowd [9, 17, 24].

• with the user: company and users co-design a solution, and

• by the user: users innovate a solution on their own initiative [12–16].

## **3.1. Uncertainty of innovation**

Innovations can be parsed with the product-market matrix (**Figure 1**). Uncertainty is greatest when creating a new product for new markets. This is called a suicide quadrant of innovation. In fact, entrepreneurs or innovators do not see this as a suicide quadrant, but as a vital possibility to create new business [5, 6].

Uncertainty can be divided into uncertainty in demand (whether customers buy a solution) and supply/technology (can we build the desired solution). Uncertainty is related to a lack of knowledge. The more unknown things are in customer preferences and behaviors, the greater is the uncertainty in demand. If there are already existing products and market, then forecasting is easier, for example by analyzing competitors' sales and actions. Technological uncertainty is associated with, what new technologies emerge, and when or what kind of new technology the company can itself develop. Experimental innovation with users has been seen as a key tool to reduce uncertainty [7–9].

### **3.2. User-centered innovation**

User-centered innovation means that persons in the company and its value network are included in the innovation. Especially the end users of products and services play an important part in this. Users can also come from outside the current value system, in which case the issue deals with extreme type of open innovation [10, 11].

Users may have different roles during the innovation process, such as idea creator, evaluator, idea refiner, designer, and manufacturer of prototypes. At most, they may participate in

**Figure 1.** Product-market matrix [5, 6].

innovation throughout the innovation process. On the other hand, users can be grouped to three groups according to how active they are:


Innovation is born when a company meets the conscious or unconscious needs of the customers. Majority of the customers cannot say what they need before seeing and even experiencing a solution. Unconscious needs often come up only through product or service experiences. This may take place, for example, by providing a prototype for the customers to test use. Customers can be divided into innovators, early adopters, early majority, late majority, and skeptics. Innovators and early adopters are called lead users. Compared to the designers who are good at solving defined problems, the lead users or fans are need experts who have insider knowledge. They can identify previously unknown customer needs. When they bring their need expertise in order to connect it with a designer's solution expertise, new solutions can become blockbusters. Lead users often help designers further customize and fit a product into users' everyday life. The innovators are the kind of lead users who innovate on their own initiative. The early adopters, on the other hand, are more like codesigners. Critical point is between the early adopters and the early majority. Most innovations die in this chasm [9, 12, 15–20].

#### **3.3. User-study methods**

**3. Preliminary theoretical understanding through literature review**

work seemed to be in quite a many places in progress.

**3.1. Uncertainty of innovation**

116 Digital Transformation in Smart Manufacturing

sibility to create new business [5, 6].

as a key tool to reduce uncertainty [7–9].

issue deals with extreme type of open innovation [10, 11].

**3.2. User-centered innovation**

**Figure 1.** Product-market matrix [5, 6].

Theoretical themes included uncertainty of innovation, user-centered innovation, and userstudy methods. In addition, it was examined what kind of smart jewelry is already on the market. In 2013, there were still very few jewelry for sale, but innovation and development

Innovations can be parsed with the product-market matrix (**Figure 1**). Uncertainty is greatest when creating a new product for new markets. This is called a suicide quadrant of innovation. In fact, entrepreneurs or innovators do not see this as a suicide quadrant, but as a vital pos-

Uncertainty can be divided into uncertainty in demand (whether customers buy a solution) and supply/technology (can we build the desired solution). Uncertainty is related to a lack of knowledge. The more unknown things are in customer preferences and behaviors, the greater is the uncertainty in demand. If there are already existing products and market, then forecasting is easier, for example by analyzing competitors' sales and actions. Technological uncertainty is associated with, what new technologies emerge, and when or what kind of new technology the company can itself develop. Experimental innovation with users has been seen

User-centered innovation means that persons in the company and its value network are included in the innovation. Especially the end users of products and services play an important part in this. Users can also come from outside the current value system, in which case the

Users may have different roles during the innovation process, such as idea creator, evaluator, idea refiner, designer, and manufacturer of prototypes. At most, they may participate in The essential thing in creating new products for new markets is to challenge the current market definition and create a new one; in this case, challenge the definition of traditional jewelry and create a new one for smart jewelry. Creating a new market definition is based on an indepth understanding of the users. For this reason, it is necessary to consider what designers know in advance, and which questions can only be answered through collaboration with customers and other partners. For this, variety of user-study methods can be utilized such as user participation, prototypes, experiments, observation, and interviews (**Figure 2**). On the basis of the user research problem, the most suitable method classes and single methods within them are utilized. The use of different methods may take place simultaneously (e.g. observation and interview) or sequentially, such as making first prototypes and then testing them. Choosing the method and knowing how to use it are essential skills when carrying out user research [17, 21–23].

In the user-centered innovation, qualitative research methods are utilized instead of or in addition to traditional market surveys. The aim is to get caught up on the users' experiential relationship to a product. This approach is a key to getting an idea of a variety of product use cases and finding the core value of product. It is critical to understand user goals and motives through the meanings. User understanding can be structured through user profiles that refer to a variety of ways to use the product, as well as attitudes toward the product. Users can be placed in different categories, such as doubtful, familiar, seeker, etc. Creation of a user profile can start from only one customer by understanding his life profoundly. After this, the profile may reflect a larger crowd [9, 17, 24].

Smart functional jewelry was defined as follows: *Functional jewelry provides users just only aesthetic, social, symbolic and emotional value but also functional value, in other words concrete benefits.* The best 30 smart jewelry ideas were conceptualized. **Figure 3** shows pictures from conceptualizing workshop and the first rapid prototypes of smart jewelry. Rapid prototypes were important in making the ideas more concrete as well as in forming a common understanding

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The best smart jewelry ideas were conceptualized, after which prototypes were manufactured from the best concepts. By utilizing readily available electronics, some of the prototypes became bulky and heavy compared to many traditional jewelries. Solar cells were utilized in

Action researchers were the main innovators of smart jewelry and potential jewelry users themselves. Numerous other potential and nonpotential users participated in innovation work as innovators, early adopters, and other users of smart jewelry. Less than 5% of them had previous knowledge of smart jewelry and no one had any previous user experience. Sixty-eight percent of users were Finnish and the remaining 32% came from other nationalities, emphasizing on Europeans. Totally 14 different nationalities were presented. The proportion of women to men was 61 vs. 39%, and the age varied from 16 to 62 years, the average age being 25 years. Onefourth of the test group people did not use even traditional jewelry at all. They were chosen to study as the laggards or the late majority groups. It was immediately obvious that the smart jewelry was "high concept," which attracted people's attention and pulled free resources to participate in innovation. To get answers to the five research questions, different kinds of user-study methods were used (**Table 1**). The manufactured prototypes were utilized with all the methods.

what smart jewelry means. They also inspired to innovate more.

some prototypes as renewable energy source.

**Figure 3.** The concepts and first rapid prototypes of smart jewelry.

**Figure 2.** User-study method classes [21].
