Week 5 – Exploring Innovation in an Open World

Action Items this Week

Slides

Here is a copy of the lecture slide deck for 5 – 29 Oct 2015 Open Innovation.

This week we explored the concept of open innovation. How does it differ from traditional innovation and what examples can we explore to appreciate its dynamics? Is it related to Open Source and Free Software as we have been discussing over the past weeks? Is it feasible and can we measure its impact?

Please take a look at the following video presentations.

Don Tapscott – 4 Principles for the Open World (2012)

donTapWe met Don a few weeks back and although we’ll meet a couple others shortly, let’s let Don to share a few more thoughts on Open Innovation – in a really down to earth way. Note the whole open theme forming.

The second presentation comes from Eric von Hippel. This is an intriguing and a little more academic discussion exploring the economics of innovation. Please take a watch of:

Eric von Hippel – Paradigm Shifts in Innovation (2009)
vonHippelEric von Hippel is an economist and a professor at the MIT Sloan School of Management, specializing in the nature and economics of distributed and open innovation. He is best known for his work developing the concept of user innovation – that end-users, rather than manufacturers, are responsible for a large amount of innovation. In order to describe this phenomenon, he introduced the term lead user in 1986. von Hippel’s work has applications in business strategy and free/open source software (FOSS) and von Hippel is one of the most highly cited social scientists writing on FOSS.

Finally meet Charles Leadbetter – The Era of Open Innovation (2008)

charles_leadbeaterCharles Leadbeater’s theories on innovation have compelled some of the world’s largest organizations to rethink their strategies. A financial journalist turned innovation consultant (for clients ranging from the British government to Microsoft), Leadbeater noticed the rise of “pro-ams” — passionate amateurs who act like professionals, making breakthrough discoveries in many fields, from software to astronomy to kite-surfing.

There is no reading this week. It’s just watching. There is an intriguing piece but I am leaving it entirely as a ‘bonus’ piece. I like the concept of Open Innovation and am happy to explore it further, but the above videos will give you a very good scope and scan of the parameters.

Here’s the bonus in case you wish to pursue:

Question for forum discussion

Open Innovation holds great promise (feel free to agree or disagree) and you’ll see much discussion about Open Innovation 2.0 and even 3.0. Our own Martin Curley, Director of Intel Europe is an OI champion and is pushing the concept of OI 2.0 to more broadly involve a wider number of stakeholder groups to create an innovation ecosystem.  Exploring the concept of open innovation and the Dublin Declaration as defined (http://www.slideshare.net/DCSF/martin-curley-closing-final) is this a purely aspirational initiative or can we measure the success of open innovation in its 2.0 conceptualisation?

17 thoughts on “Week 5 – Exploring Innovation in an Open World”

  1. I think Tapscott has a lot of truly great ideas regarding, “The Age of Networked Intelligence” and “The Four Principles of an Open World.” I wholeheartedly believe in his first three Principles; Collaboration,Transparency, and Sharing. In my opinion these three are logically sound and lay a foundation for this new age. Tapscott’s other principle; Empowerment was described as the “Distribution of Knowledge and Power” but there was no talk of the “Distribution of Wealth” and that is where I have a problem.

    I now know that his neighbor ,the CEO of GoldCorp, is a very happy man because his company is worth 10 Billion Dollars but how many children in Ontario live below the poverty line alone (not to mention the world). That’s why I’d like to see a fifth principle called “Being a Decent Human Being” which would be based on the idea of helping each other out because you don’t need another 200 foot boat.

    I feel that there are too many “predators of money” in this world and just like the murmuring starlings in the video joined together and scared off its flying predator I feel that it is possible that a “Human Murmuration” could form in order to defend itself.

    Is it too idealistic for these large companies to dig deep into their pockets in order to dig everyone out of poverty? Probably! But it never hurts to ask.

    1. Ha! Yep, one of the commenters hit the nail on the head with that one. I though that that anecdote was more of a counter-example to the point Tapscott was trying to make. There was sharing of information, yes, but only those whose ideas were liked got paid. Collaboration’s all well and good, but if information’s the only asset you’ve got, if you’re not careful you’re going to lose out to the guy with the gold mine.

      Another thing I found interesting was his perspective on political power. Does social media contribute to the understanding of political issues, or it just issues being broken up into bite-size chunks, swirling along in a timeline? The Arab Spring may have been driven by Twitter, but if everything being open contributes to understanding, then how come the nature of the protests was so badly misunderstood in this part of the world?

      I really liked the reference to murmurations, I though that was very apt.

      1. I agree with some of what is being said but I think Rob has made a very valid point. “Collaboration’s all well and good, but if information’s the only asset you’ve got, if you’re not careful you’re going to lose out”. Some of us today will lose out to big companies looking to save money by shipping jobs to a cheaper location so why should I share my info and lose my job to a guy earning $10 in India.

        1. I have to say Kevin’s comment is very valid regarding information sharing and shipping jobs abroad. As a small nation heavily involved in Information Technology we should really be jealously guarding our technologies and selling them rather than sharing them because information is power and power is control and if you’re giving up control over your technologies or your industries you could end up loosing a vital edge to some bigger international organisation.

          1. The global shifting of jobs is not new. One historical example I can think of was in America during the time of the civil war the South were making huge profits for producing cotton while North were making huge profits by manufacturing the cotton into clothing. The difference being that the North were not happy with the exploitation of the slaves.

            So fast forward 150 years and you will see the manufacturing jobs are in the far east where the labour is far cheaper and pretty much borderlines slavery. Within the global economy, corporations are still exploiting the worker and in my opinion the only way to combat this is to create more worker co-ops where the workers acutaly own the company.(see http://en.wikipedia.org/wiki/Alvarado_Street_Bakery). I think a balance could be reached by expanding this idea of collaboration into Information and Technology.

            If the workers own the company and they split the profits among themselves instead of a board of directors moving jobs to other hemispheres in order to cut costs then collaboration could actually be the salvation for capitalism.

      2. I was definitely making a counter-example to Tapscott. His ideas regarding collaboration etc… seem to be based heavily on capitalism which like all economic systems is flawed. But in my opinion capitalism’s flaws make corporations huge profits through the exploitation of the worker and natural resources so I feel that this type of collaboration (as in the case of GoldCorp) is detrimental to society,the environment, and the future of the human race.

  2. I absolutely agree that Open innovation holds great promise this really seems to be a time of change as Tapscott mentions the Arab Spring it is apparent that over the past few years communities and individuals are taking stand against oppression and instigating change. I found it very interesting and not at all surprising that it is the users that are commonly the inventors and innovators, however it is the manufactures and corporations that reap the rewards. It is sad to how corporations are benefiting from communities, as with the gold miner who launched the competition. But I am hopeful that with the younger generation (I can’t remember what Don called them) but the Net Generation hold great potential, they’ve grown up with technology and it’s not as challenging for them, so I feel that there are huge opportunities for Open Innovation. I think that one key dependency for the success of Open innovation is shared values, it’s not just having common interests but it’s communities working together to reach common goals that benefit the group and not the individual.

  3. Great videos, and again a lot of food for thought! With regard to the relationship between Open Innovation and topics like Open Source and Free Software, I see Open Innovation as the big picture or the “ecosystem” (as mentioned in the Dublin Declaration), and Open Source and Free Software as the tools for realizing it.

    What I find remarkable is how the concept of Intellectual Property plays such a fundamental role every time “Openness” is being discussed.

    Also, as per some of the other comments posted on the forum, I do agree that distribution of wealth should be taken into account when discussing “Openness”…unfortunately it always looks like we want to share with those who have more!

    In summary, I do love the idea of open innovation and we do have all the tools to implement it. But is there a real willingness? Are the policy makers ready to create laws that can stimulate innovation? And at a European level? Isn’t Intellectual Property a barrier to
    this? Are the current economic models suitable to encourage such changes? And
    in particular, are the manufacturers ready? How would competition fit into an
    Open Innovation Ecosystem?

    Despite the above questions and the need to address them, I don’t think the Dublin Declaration is a completely utopian project. I simply think times are not mature for it. However, it is definitely inspiring to realise how many people are interested in this discussion and to see the potential benefits that society could gain from such a cultural / ideological / economical/ technological etc. change.

  4. Some great videos thanks. And a wealth of information and opinion on open collaboration and innovation – which can only be a good thing. I have to say Tapscott didnt convince as much as von Hippel – there was great hope and enthusiasm and the comment “sunlight is a great disinfectant” was a perfect summation of the transparency we hope for when we think of open collaboration and shared intelligence. But von Hippel brought sound metrics to the measurement of openness – and thats the thing really isnt it, that most people complain about – why give up my ideas, my time or encourage a system where people give of their work for free – and potentially threaten my livelihood?
    But the ability to measure what is currently happening in the world of open innovation is possibly the one element that will give sound credence to the concepts – can open innovation projects and products contribute to an economy’s GDP measurement? This is so hard when most user designed products have such a low initial cost base – I think it was mentioned that 90% of the value comes from 10% of the inventions. Public policy will be slow to change until some sort of economic parameters can be applied to measure true worth – user-driven innovation measurement must be calibrated in an entirely new way.
    Another pre-requitiste is that we need to be less territorial – we use IP rights to keep our teddies in our own prams. I had never really thought, until it was discussed by the folks at Berkman, how much time and money it must cost to check out if your new product infringes on existing copyrights and patents! This will stonewall any attempt to release innovative products for shared collaboration – and these pro-ams, as Leadbetter calls them, are true pioneers. Now that we know (or think we do) everything and have explored everywhere, we have lost our pioneering spirits – at least at public policy level. This protection of traditional “closed” companies by government is akin to impounding the ‘Santa Maria’ so so couldn’t set sail – and we know what the impact of that would have been!
    Humans are intrinsically open – til it comes to money. Unhook innovation from base economics, or create a new theory, and there might be some hope.

  5. Leadbeater’s stories were interesting if not fascinating. I had no idea of how mountain bikes were developed (I assumed it was a corporation). The “Rap” example was modern but it was actually just history repeating itself. Before the music business was actually a business there was a huge “musical innovation” developed by sharecroppers and former slaves in the United States deep south. This new music was probably one of the only ways one of these men or women could openly innovate. They would play cheap and homemade instruments like a “Diddley Bow” which was crafted from a broom stick and some fence wire to create a one or two stringed instrument like a guitar.

    To cut to the chase……..The moral of my story was that a new form of music was innovated by people collaborating but when someone figured out it could be recorded, sold, and broadcast than it was immediately exploited by corporations and eventually a multi-billion dollar industry was created. Granted this gave us Blues, Rock and Roll, Cajun, Jazz, and Country Music, Funk etc…..so as much as I’d like to show my displeasure toward these “Evil” companies they have served a function. I just wish they shared those billions a little more.

  6. Interesting topics and a lot to take in. I really like the idea of open innovation and find the real world examples surprised me (mountain bikes, white water kayaking). I would not have thought that users were the main innovators before watching these videos but thinking about it makes sense. These videos have raised the following concerns or thoughts:

    1. As social networking and online communities mature and available technology changes, I think open innovation will naturally grow. The point in the curve that the manufacturer joins in could also significantly change. With the likes of 3D-printers becoming more available the need for a manufacturer changes. Will this mean the manufacturer joins the curve earlier to be part of the innovation process?

    2. I think the power of open innovation needs to be respected. This type of innovation is very effective and not every innovation is innocent or benefits man kind. There are groups of users who are constantly innovating ways to make money or commit fraud. Hackers and cyber criminals have close knit communities “raisins in the cake”and share to a degree information and innovations developed over time to by-pass or defeat current security measures. If their rate of innovation exceeds that of available security products or protocols. it would have serious consequences.

    3. Open Innovation 2.0 to me sounds like a nice idea but I’m not sure if its currently feasible in Ireland at the moment. To me ‘Quadruple Helix Innovation’ does not match up with the curve Eric von Hippel showed in his video. At the end of the day industry is going to look at the innovations value vs. the € cost. Asking companies to invest in R&D to innovate may not be possible in the current climate with so many businesses failed/failing. This is where the previous curve looks to be more practical.

    4. Another point in Open Innovation that stuck in my mind was action item 9 “Stimulate High Expectation Entrepreneurship”. This could be a great boost to the jobs market in Ireland as any new business worries about outgoing costs. If such a business is encouraged to stay in Ireland rather than outsourcing roles to a cheaper workforce, it would definitely add a boost to the economy.

  7. I love this idea of open innovation. It’s a real feel-good factor in an
    industry that is dominated by business and money. In fact there is a technology
    bubble in the States at the moment. It no wonder with all these large money
    figures floating around with Twitters IPO, Bitcoin prices and billions being
    offered (and refused) for companies like Snapchat. I feel that open
    source/innovation is what helped created these social media sites – but as soon
    as they become successful they move into a different business model. They
    should plan for this and give back the money to help further promote and share
    to help other start up web businesses.

    I saw an article in the metro this week that reminded me of Eric Von Hippels
    video. Hackers are now being paid big money by large technology companies like Facebook and Microsoft in return for identifying bugs in their software. Page 19 in
    Mondays Metro http://edition.pagesuite-professional.co.uk/launch.aspx?eid=f59a8581-ee0d-4b75-93f7-2faf4166ae6a&pnum=21&keywords=hacker
    One researcher got a payment of €100,000.00 for four weeks work. This is very
    similar to what Eric Von is saying, users are innovators. It is people that are
    outside the system that use it that can see how it can be improved, or indeed,
    hacked. They have the skills from using the products and they can see the vulnerabilities
    it has and can advise on the best way to improve. If large technical companies
    are willing to recognise and pay hackers then this should enough other big
    companies to invest in user research.

    1. I thought there were lots of great examples of how end users are the real innovators in Eric Von Hippels video, and of course that makes sense. End users are at the front line of product experience, not just for the test phase but for the lifecycle of the product. I disagree with Erics view that manufacturers are ignorant of this fact though. Manufacturers have been engaging consumers in focus groups and listening to customer feedback on their products for decades, collaborative tools have just made it a lot easier for companies to access innovation through co-creation and there are so many example of how this is being embraced by manufacturers across many industries.

  8. One of the most important words in the title of this article is
    “Open”. I noticed a lot of people are focusing on the innovation
    aspect of the review but I think there is something to be said for someone who
    may not come up with something original but by taking multiple approaches to
    information that is out there and open to everyone the end up finding an
    innovative way to use something which most people would consider old or not
    cutting edge.

    A good example of an industry that does this regularly is Indie
    gaming, with limited funds and very little backing a lot of indie developers
    start with something open source or something which has passed its prime, tweak
    it a little bit and give their audience a new perspective on something they
    thought they didn’t need to pay attention to anymore.

    This form of innovation wouldn’t be possible without the
    open source elements that everyone has access to but very few people credit as
    useful. In fact the contest discussed in
    the first video is a great example of this, a gold mine turns their private
    research data into open data and someone off-site and with nothing to do with
    the company discovers a way of looking at this very same information that
    results in a 3.something billion dollars’ worth of gold.

  9. Watching the Don Tapscott video I recognised that an area I have been researching lately is an innovative example of the power of collaboration through distributed computing. Bitcoin (and most other cryptocurrencies) use collaboration to secure the block chain. Miners dedicate processing power to a distributed network that secures Bitcoin transactions against reversal. Miners are rewarded for their efforts with new Bitcoins that are created as each block is solved, plus some transaction fees.

    An interesting slant on this is the Ripple cryptocurrency. Ripples don’t require mining, every Ripple that will ever exist has already been created (100 billion of them). The Opencoin network will hold onto 30 billion XRP for the development of the currency and are literally giving the other 70 billion XRP away gradually. There have been several different types of giveaway but a very successful one that is still running is that they have teamed up with the World Community Grid, a non-profit distributed computing network that benefits humanity by harnessing the power of your computer for scientific research. You can earn Ripples by running a screensaver on your PC that uses your processing power for cancer, aids and other research while your pc is idle.

    So, instead of mining for no reason other than to secure truncations, Ripple harnesses the collaborative power of distributed computing for altruistic purposes and rewards users for their contribution. A very clever, well motivated alternative to mining that attracts publicity and circulates the Ripple currency in an innovative way.

    https://ripple.com/blog/computing-for-good-ripple-labs-launches-global-xrp-giveaway/

  10. Again great talks on Open Innovation and its importance in invention by the end user. Being a warm weather kite surfer, I can appreciate why Leadbetters acknowledges its open innovation as the pioneers were the users as far back as 1800 in a slow process of development. Then the late 90s manufacturers Cabrinha, Pryde and Naish took it mainstream when the executives realised there was money to be made from it, seems to be a re-occurring process that doesn’t directly benefit the innovators.

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