Yesterday's NY Times business section (free registration required) included a brief article titled: How to Improve It? Ask Those Who Use It. The article discussed the rising use of user-driven innovation, where companies are receiving input from customers on the design and customization of their products.
Unlike user-centered design which incorporates end-user input into a company's internal design process, user-driven innovation is externally motivated. For example, a company may adapt a customization made by a current product user into the next version of its product.
The article discusses how this has happened for a particular medical device manufacturer, and touches on the logistical and legal challenges to this approach. For additional information, the article refers to Eric Von Hippel's Democratizing Innovation, which can be downloaded as a PDF.