economics

Open Innovation 2.0.pdf

and the impact of the new approach in action, involving all stakeholders into the common journey from invention to innovation.

clusters and also triple helix innovation where the stakeholders are academia, industry and public sector. Open Innovation 2. 0 however brings us further,

taking the full advantage of strong seamless interactivity across all stakeholders, including users, across the whole innovation ecosystems.

frictionless innovation space where all the stakeholders can share their ideas, prototype them and scale up the successes rapidly.

And, of course all stakeholders should be able to build and contribute to the innovation ecosystems by bringing in their competencies,

Sharing is the best guarantor for growing the pie for all stakeholders. I believe this edition of the yearbook gives you stimulus

Daria European Institute of Innovation and Technology daria. tataj@eit. europa. eu Huuskonen Mikko Lappeenranta University of Technology & Ministry of Employment and the Economy, Finland mikko

This new interaction model leads to a more inclusive society based on joint wins across all stakeholders.

'Crowd-based assets are a new source of innovation and economic growth. Many organisations are aware of this,

it will be dwarfed by the efforts of teams that enable a wide spectrum of stakeholders to take on active roles.

when a wider spectrum of stakeholders participates, is heard more frequently from world leaders, as the following comments reveal.

'At last, in the Western economies, there is recognition that a long-term view is needed. As stated in the Obama Administration's Strategy for American Innovation,

‘A short-term view of the economy masks under-investments in essential drivers of sustainable, broadly-shared growth.

Once again we want to stress the importance of the creativity beyond organisational boundaries as essential to creating valuable components for innovation from a societal (market) perspective due to new co-creation processes across all stakeholders.

and will help achieve broader scale innovation benefits for larger numbers of stakeholders. In OI2 there is also a cultural shift away from resisting change and toward innovation and the creation of shared value.

The growth of the global app. economy is one such example where an industry that did not exist a decade ago is being fuelled by millions of individuals working as developers.

In Europe alone, the EURAPP report estimates the revenues in the European App. economy were EUR 17.5 billion with contract development work being EUR 11.5 billion of this.

By 2018 the European app. economy is projected to grow to EUR 63 billion with contract development work growing to EUR 46 billion.

That is where you find the creative ferment which drives a modern dynamic economy'.'From OI2 perspective we need to go beyond the rather monolithic cluster thinking to multidisciplinary ecosystems,

Innovation Co-creation and Engagement Platforms Co-creation includes all stakeholders, including citizens, users, or customers, in the development of innovative solutions.

It is important to see how these changes in the drivers for success have led to different policy approaches by all stakeholders.

Also the roles and collaboration of stakeholders is very different from the past. Introduction The traditional innovation approach is based on linear innovation,

Innovation is increasingly based on cocreation processes across all stakeholders, including the end-users. Here we need to have a look at one of the most important assets in Europe for growth:

and frictionless environments for multi stakeholder trials, including legal and policy elements is the key to root in the European mind-set.

and sharing of innovation options constitute a significant competitive advantage with broader scale benefits that leverage and benefit all stakeholders.

'However, it requires all stakeholders, including users, to be engaged along the design process for co-creating,

Since 2006, the LL approach was applied gradually within EU projects for involving all stakeholders, especially users and also policy-makers,

in order to result in the most appropriate UX while sharing knowledge and crystallising the collective work of the LL stakeholders.

but rather occurring until the evaluation of UX satisfies all project stakeholders. Furthermore, the XD process concurrently occurs at different granularities,

artefacts and/or innovative scenarios as sessions of collective creativity involving all concerned stakeholders and especially users;

and discussion with all stakeholders of potential refinements in order to prepare the next iteration until it reaches the proper level of user adoption.

for example in view of solving societal issues (e g. smart city services) but merely requires immersive techniques/technologies for engaging all stakeholders, especially users, in the environment of augmented creativity.

and encourages stakeholders to freely explore alternatives for increasing safety and Figure 5: The Logistic Use Case 28 O P E N I N N O V A t I O N y E A r B o O k 2

with a set of stakeholders on air quality and noise measurement via citizen sensing. During the XD process involving 50 active users,

Top-down because the holistic UX model guides project stakeholders in foreseeing the types of value and corresponding user experience they would like to design in their Iot related product/service.

and therefore in contrast with our economic growth in western countries. It seems to occur that our smart phones are literally becoming the key not only to our virtual world,

It also made clear just how interdependent and inter-linked the EU's economies are.

Greater economic policy coordination (1) across the EU will help Member States to address these problems and boost growth and job creation in the future.

The Europe 2020 Strategy (2) is a comprehensive economic policy agenda focusing on three priorities: smart, sustainable,

b) sustainable, thanks to a decisive move towards a low-carbon economy; and (c) inclusive, with a strong emphasis on job creation and poverty reduction.

and to create conditions required for a more competitive economy. Such an approach aims to help Member States and their regions to deliver higher levels of employment, productivity,

and compete in the global economy in a sustainable (financially as well as environmentally and socially) manner following the smart, sustainable and inclusive growth priority.

The S3 principle further requires uniting national and regional stakeholders and resources around an excellence-driven vision of their future.

and regions to strengthen their innovation systems, maximise knowledge flows, absorption and utilisation as well as spread the benefits of innovation throughout the entire national/regional economy via market,

as an expansion from the dyad of industry and government as primary institutions of the industrial society, to a triad of primary institutions specific to a knowledge based society and economy.

of the era of the Internet and more open societies and economies (varieties of capitalism).

While very different in nature, both models present a unique chance to better understand the principles of knowledge economy

and engages all sectors of the economy and society. Such a model is seen as the key for future sustainable growth and prosperity.

Policy initiatives such as S3 allow regional and national policymakers to focus on a number of core processes in the knowledge economy and society,

The Fifth Report on Economic, Social and Territorial Cohesion prepared by the European commission (2010) has advocated further the importance of engaging fully relevant local and regional stakeholders, social partners,

and to further the knowledge-based economy (13). The established Triple Helix model is a strong environment of parallel relationships between (national or regional) authorities, the wider business community (industry),

which then connect users with their stakeholders across industry, academia, or government (21). In turn, the role of actors in the other three helices would be supporting citizens in such innovation activities (e g. to provide tools, information,

Furthermore, industrial players and public sector stakeholders would then be able to exploit the innovations developed by citizens.

and operational functionalities and complementarities of these sectors in the context of the knowledge economy.

and innovation systems interacts with the political and economic systems for the purpose of regional development.

Policymaking, legislation, steering, coordination and communication are the tools available for influencing the dynamics of a society and economy.

The political system aim at stimulating and coordinating the performances of the other societal systems. 2. The self-rationale of the economic system:

The economic system aim at achieving wealth. In doing this, the economic system can assess how to avoid for example inequality or negative environmental impacts. 3. The self-rationale of the knowledge system:

The knowledge system creates and distributes knowledge. The knowledge system can potentially influence the other societal systems by supporting

The political system is able to influence the economic system directly through economic policy, but in many cases, the political system can do this even more efficiently through innovation policy.

As mentioned, the economic system, that is, business and firms, act in accordance with a rationale of profit,

and innovation in the glocal knowledge economy and society requires a substantive supporting of the development and evolution of innovation cultures''(37).

economies seem to have one important thing in common they put innovation at the heart of their regions'economic sustainability and growth.

See for instance the case of Finland and the Nordic region at large as outlined in excerpt from a recent Economist report (Economist

Which are the mechanisms to have wide and effective involvement of stakeholders in priority selection?

and know how in order to utilise resources innovatively for society and the economy in an environmentally conscious manner.

and implies ramifications for the‘glocal knowledge economy and society'(49). It is clear that the challenge of global warming is accompanied with the challenge of sustainability (for the 56 O P E N I N N O V A t I O N y E A r B o

that require‘sustained action',political and economic‘leadership'or‘empowerment'and‘intelligent use of technology'(Carayannis and Kaloudis 2010, p. 2) 1.)‘Financial/Economic system'(1);

innovation and entrepreneurship as drivers of knowledge societies'(9).(1) The area of‘Financial and Economic system'refers to financial and economic aspects of the effects of climate change.

a higher competitiveness of their economies or a better and sustainable quality of life, have to apply the resource of knowledge.

In the transformation to a knowledge-based society, knowledge-based economy or knowledge-based democracy (51), also under the aspect of climate change, it is possible to generate new and usable knowledge in conjunction with sustainable development.

and diversity of knowledge and innovation modes as being necessary for advancing societies and economies.

whether in the future a state (nation-state) is leading in world politics as well as in the world economy is also being determined by the social (societal) potential to balance new knowledge, know-how and innovation with nature.

The basic innovation‘core model'of the Triple Helix focuses on the knowledge economy. Quadruple Helix already brings in the perspective of the knowledge society (and of knowledge democracy.

From the point-ofview of the Quadruple Helix innovation model it is evident that there should be a co-evolution of the knowledge economy and of knowledge society (see also Dubina et al. 2012.

)‘ Measuring the knowledge base of an economy in terms of triplehelix relations among‘technology, organisation, and territory.'.'Research Policy 35 (2): 181 199.12) Leydesdorff, L.,M. Fritsch (2006.‘

Conceptual framework for an analysis of diversity and heterogeneity in the knowledge economy and society.

Diversity in the knowledge economy and society: heterogeneity, innovation (pp. 95 116. Cheltenham: Edward Elgar Publishing Limited (further references:(

The Smartphone CEO Study, Journal of the Knowledge Economy, June. further references:(26)( 50))(39) Harmaakorpi, V.,Melkas, H..Knowledge management in Regional Innovation Networks:

which is different for diverse stakeholders collaborating in such an open innovation environment. We realised that it is yet different for a university professor who also would like to start a company

but they still convey very important economic value as well as social value developing knowledge, educating employees and tackling public health challenges.

which all stakeholders have their own interests and goals and they all contribute to value creation.

The KIC's shareholders agreed on a business model that will hopefully lead it to financial sustainability.

This co-location of people will allow stakeholders to work together face-to-face and move forward effectively towards KIC goals.

Joseph Schumpeter referred to an entrepreneur as a driver of economy who by combining assets (including technologies) in new ways creates new opportunities, new markets, new economic values and effectively new demand and supply curves.

A KIC needs a business plan that outlines its expected trajectory towards creating value for its stakeholders.

Its stakeholders include the EIT but also industry and academia. The grants administered by the EIT are not to become another state subsidy

they will not be able to deliver value for their shareholders and stakeholders. Some KIC partners express a real concern on how to define the business model of a KIC.

Introduction European union investments in advancing the European Knowledge Economy and Single Digital Market development are by definition longitudinal and accumulative by nature.

The FI-PPP platform concept aims to support stakeholder roles in the future Internet value network, in particular technology providers, infrastructure providers, integrators, service providers, application developers and users.

the FI-PPP programme can be considered to have succeeded in its objective to engage the major stakeholders in Europe

and attract interest among new stakeholder groups and communities. The current programme beneficiaries include all major European ICT companies,

CONCORD, together with a task force of lawyers from all major stakeholders, drafted a contract and collected feedback from all participants in two rounds of iterations by structured template by email

More attention was allocated to dissemination and stakeholder engagement. This included establishing linkages to other related initiatives in technical and policy domains for leverage

The role of this Board was to ensure the commitment of the major industrial stakeholders, and strengthen the business linkages

and across the various programme governance bodies and to represent the FI-PPP programme among external stakeholders.

This new role simplified the communications and representation of the FI-PPP programme towards the broader stakeholder audiences.

and communication patterns Relations management with key stakeholders Increased networking with stakeholder communities Process based management FI-PPP as programme organization Standard management rules and procedures Governance

‘The Economics of Two-sided Markets'.'Journal of Economic Perspectives, Vol. 23, Nr. 3, pp. 125 143.9) Pisano, G.,Verganti, R. 2008.‘

Introduction The 2008 global financial crisis is considered by many economists to be the worst since the Great depression of the 1930s.

During this period, economies worldwide slowed, credits tightened, international trade declined, and business and consumer confidence eroded with enormous and rapid job losses.

capital crunch, currency crash, high inflation, high unemployment, undulations in housing and equity prices, and government defaults on international and domestic debts (1). The source of the problem generally includes improper rules and policies, ineffective governance, failed surveillance systems,

and purchasing goods. This cyclical problem affected the real economy thus developed into the deepest and most synchronised global crisis in the last eight decades.

In 2009, Chile's economy contracted by 1. 5, %export volume dropped by nearly 20,

I O N y E A r B o O k 2 0 1 4 The Australian economy grew for 17 consecutive years before the 2008 global financial crisis,

the Australian economy entered the global financial crisis with a strong base. Gross domestic product (GDP) grew by 3. 7%in the 2007 2008 financial year (ending June 30)

and the unemployment rate stood at 4. 2%(6). The government also had a substantial fiscal surplus for the stimulus measures introduced after the onset of the crisis. Chile has oriented a market economy characterised by high levels of foreign trade

and its banking industry was ranked 4th (out of 133 countries) in terms of soundness (3). Exports account for more than one-fourth of its GDP, with commodities making up about three-quarters of its total exports.

and low levels of public debt (3). The Impact of 2008 Financial crisis Australia Australia was hit hard by the 2008 global financial crisis due to its export-oriented economy.

and consumption (representing over 60%of the Australian economy) and to be quick acting with significant cash bonuses paid to those in need within weeks of the announcement (9). In early December 2008,

and to boost economic growth by about 0. 5%and 0. 75 1%of its GDP in 2008 09 and 2009 10, respectively (9, 10).

Chile With a relatively small market and far away from the centre of the world economic activities, Chile enhanced its longstanding commitment to trade liberalisation with the signing of 57 free trade agreements including the US, the European union, the Common market of the South america, China, India, South korea,

Because of its high trade and capital market integration, the economy was affected severely by this financial crisis.

its unemployment rate grew from 7. 5%in 2008 to 10.8%during the second quarter of 2009 (3). Inflation rose from an average of 2. 6%in 2006 to 7. 8%in 2008,

. In addition to provide liquidity to the market, the government launched its major fiscal stimulus package of US$4 billion (2. 8%of its GDP and 14%of planned current fiscal expenditures),

job protection and job-training stimulus. Fiscal policy was at the core of the Chilean government response to the crisis,

In the past, the Chilean government conducted a rule-based countercyclical fiscal policy, accumulating surpluses in sovereign wealth funds during periods of high copper prices

and economic growth, allowing deficit spending only during periods of low copper prices and growth. As of September 2008, those sovereign wealth funds kept mostly outside the country

6). Australia was one of the first advanced economies to recover from the financial crisis and to raise interest rates, with seven rate hikes between October 2009 and November 2010 (5). In addition to substantial trades with China,

retail sales and economic growth. With strong prudential and corporate reporting framework, Australia coped well with the financial turmoil,

In general, Australia weathered the world recession better than almost all other advanced economies (Debelle, 2009;

and the terms of trade rose by 2. 9%.The Australian economy grew by 1. 2%during 2009 the best performance in the OECD (5). The outlook for private business investment improved,

As a result of an improved economy, the government expected to return to budget surpluses as early as 2015 (5). In addition to Australia's proven resilience during this financial crisis,

the Chilean economy started to show signs of a rebound in the fourth quarter of 2009,

Chile's government received high marks from economists and its citizens for its countercyclical spending in 2009 (financed largely from saved copper revenues) to offset the effects of the global economic crisis (16.

However by 2011, the economy had recovered from the effects of the earthquake, which caused only a temporary disruption in Chile's economic activity (17).

Although Chile's economic rebound was owed partly to the fast recovery of China (its largest export market in 2010),

and consumer price inflation (CPI). In addition, tangible (GDP per capita ppp) and intangible (national intellectual capital, NIC) co-development also provide some clues for future national development.

Figure 2 shows that Chilean GDP growth plummeted sharply in 2009, with its heavy export-dependent economy.

Australian central bank has cut interest rates repeatedly to spur weaker sectors of the economy such as retail and housing construction, by boosting consumer spending (18.

GDP-NIC Co-development In the current knowledge economy, intangible asset plays an increasingly important role in national development.

and regulatory reforms can be viewed as the necessary restructuring costs for transitioning from the existing economy to an even more robust one.

In an era of knowledge economy with keen global competition the growing importance of intangible assets is recognised a trend.

-Aggressively expanded monetary policy and provided liquidity to the market in January 2009. -A mixture of new fiscal spending, targeted at low-income households (US$ 1. 1 billion), investment (US$ 1. 7 billion) and tax cuts.

and to boost economic growth by about 0. 5%and 0. 75 1%of its GDP in 2008 09 and 2009 10,

A comparative assessment of economic governance in 14 economies. Gütersloh: Bertelsmann Stiftung, 2010. Retrieved from http://www. bertelsmann-transformationindex. de/pdf/Chile. pdf (4) ECLAC (2009) Economic Survey of Latin america and the Caribbean 2009-2010:

Retrieved from http://www. dol. gov/ilab/media/events/G20 ministersmeeting/G20-australia-brief. pdf (7) Gregorio, J. 2008) The Chilean economy in the current

doc=speeches/2009/011. htm&pageid=005&min=njs&year=&doctype=(11) Access Economics (November 2008) The impact of the global financial crisis on social services in Australia, prepared for Anglicare Australia

Australia, November 2010 overview, OECD. Retrieved from http://www. oecd. org/economy/economicsurveysandcountrysurveillance/46467368. pdf (16) US State department (December 16, 2011) Background note:

2010) Chile's economy is‘back on track,'set for 5%growth this year, IMF says, Bloomberg.

Retrieved from http://www. bloomberg. com/news/2010-09-29/chile-s-economy-is-back-on-trackset-for-5-growth-this-year-imf-says. html (18) Dow jones

*Abstract The economic downturn hit young people especially hard, limiting their opportunities to success. High unemployment, job insecurity,

where those young people who wish have to prepare for the new economy that will dominate the world and‘hone the skills, capabilities,

and attitudes that will help economy remain prosperous and competitive'(4). Clearly the scheme where pupils sit for hours watching a teacher speaks no longer works.

The data begin to be seen as a commodity very capable of generating wealth and under the new‘Big data'phenomenon lays an opportunity to create value

Twothirds of that would be in the form of reducing US healthcare expenditure by about 8%.In the developed economies of Europe

we can see the contours of a more expansive and more inclusive co-creative economy and society,

enterprises and stakeholders had distinct roles. Stakeholders had a stake in value creation, but enterprises viewed stakeholders as being largely passive and docile recipients of value creation.

Stakeholding individuals now expect to have a more active role contributing through their differences in views of value

and their agency in creating value. Individuals as stakeholders, whether inside the enterprise network or outside as part of the enterprise ecosystem, are integral to this differential process of jointly defining

and creating value. A key point to CHAPTER III Open Innovation 2. 0 in a Real-world Setting Figure 1:

Contours of a Co-Creative Economy and Society Expanding Joint Interests Humanization Of value as Individuated Co-Creation Experiences Economies and Societies as a Nexus of Ecosystems of Capabilities Jointly Building Co

In other words, while the primacy of different stakeholders may vary depending on the particular framing of an economic system,

stakeholders must be recognised as human beings in all their complexity, whose ideas about value can go beyond just narrow conceptions of‘left-brained self-interests,'as it were.

The notion that individuals as stakeholders matter and must be conceptualised as being an integral part of the value creation process has gained hold in recent years.

Stakeholders are seen increasingly as contributing intrinsically to value creation rather than as entities to be managed merely by an enterprise.

Although advances have been made in going beyond the one-dimensional view of shareholder value (profit) maximisation and seeing management as beholden to shareholders

a‘homo economicus'view of stakeholders still lingers. Stakeholder theory has evolved to a more human-oriented‘homo sapiens'view.

The enterprise is seen now as not just an economic but also a moral and human institution,

the role of the stakeholder in value creation also changes from passive to active, affecting enterprises and being affected by them, opening up various kinds of causalities in the value creation process.

Co-Creation thinking evolves stakeholder capitalism even further with its individuated agency and experience-centric view of joint value creation,

Value creation is predicated on access to competence in the joint resource network (with stakeholders and enterprises still‘owning'particular key resources).

At the heart of the co-creation-based view of economies and societies is the impulse for‘becoming'.

co-creation thinking expands existing approaches to creating wealth-welfare-wellbeing in economy and society,

Humanisation Of value as Individuated Co-Creation Experiences A traditional conception of an economic system encompasses organisations

and co-creation experiences (1). In short, individuated co-creation experiences are now the very basis of value creation in the economy

Over time, Onstar has evolved as GM has learned more about the broader interests and needs of its more than 6 million customers as stakeholders in experience-based value creation.

In other words, a co-creation-based view of economy and society is about expanding collective self-interests for you and me,

The scale of the Aadhaar initiative demands a deeper level of engagement with its myriad stakeholders for it to be successful in the longer term.

the lack of inclusivity of social sector stakeholders from the start appears to have contributed to social discontents.

1 4 concerted efforts are necessary to include social sector stakeholders in order to nurture public trust. Traditional communications efforts to educate the public of the benefits of the initiative are not sufficient anymore in an age where the influences of conventional

however, requires co-designing the engagement design of this platform together with stakeholders both in the communities in which applications are designed and in the communities in

there are other key stakeholders such as public/private sector banks, non-banking finance corporations, microfinance institutions,

as a nodal entity, faces the challenge of leveraging the capabilities of these stakeholders to support the strategic architecture of multiple engagement platforms in the financial inclusion application ecosystem.

These engagement platforms will have to bring together the various stakeholders to engage in multifaceted dialogue aimed at generating new ideas in the ecosystem;

and fostering active discussions and experience sharing and consensus building among stakeholders, all to enable significant co-creation of expanded value in the ecosystem.

Further, continuous stakeholder engagement with the various users of applications service platforms would allow the ecosystem to evolve based on feedback from stakeholder experience domains, to minimise conflicts,

The returns on investments are measured in terms of a society's economy, health, and social wellbeing. Infrastructure is thus a critical determinant of co-creative capacities of an ecosystem of capabilities.

On their part, enterprises are learning how to engage external and internal stakeholders and to harness their personal, peer-to-peer,

Co-creation thinking can expand value creation in economy and society by seeing it as a nexus of private, public,

and economic growth and social enrichment in the future, as discussed next. Economies and Societies as a Nexus of Ecosystems of Capabilities Viewing markets as a nexus of differences implies viewing economies and societies as a nexus of ecosystems of capabilities centred on productive and meaningful human experiences

through platforms of engagements of all stakeholding individuals in economy and society as a whole. Consider the case of Rio grande do Sul, one of Brazil's richest states,

which nearly went bankrupt in 2005, as public investment reached its lowest level in 35 years.

In the early 1990s, Brazilian commodity export-oriented states like Rio grande do suffered Sul not only from the negative impact of the overvalued national currency

For starters, a live engagement platform was conceived for engaging different stakeholders, building political consensus, and co-coordinating lobbying activities.

Naturally, this called for a process of consensus building and democratic goal setting by a coalition of diverse stakeholders collectively representing the interests of the public.

and by volunteers, economists, politicians, and external experts led by Symnetics, a consulting organisation, over multiple phases.

either be created within government or outside of it by a coalition of stakeholders. In fact in October 2006, the strategic agenda was presented to the two state government candidates,

and knowledge to co-evolve human stakeholder experiences of value; 9. Building new strategic capital for enterprises;

Stakeholders and Enterprises Whence: Individual Human Experiences How: Platforms of Engagements From: To: Who: Stakeholding Individuals and Enterprises Whence:

E A r B o O k 2 0 1 4 The late Nobel laureate Ronald Coase, who at age 101 (in 2012) witnessed more structural changes in economy than most of us,

called for reconnecting‘Man and Economy',thus:‘‘It's time to reestablish the connection between economics and the ordinary business of life...

Knowledge will come only if economics can be reoriented to the study of man as he is

and the economic system as it actually exists'(15). Co-creation thinking bridges‘human experience and economy'as it were, providing a way to put back human experiences into the economy in central fashion,

and beyond to‘individuated co-creation experiences in society at large'through the convergence of private, public,

and social sector innovation ecosystems on wealth-welfare-wellbeing and co-creation of human value.

the more inclusive the engagement of stakeholders in the act of creating value (through engagement platforms), the better the results.

Individuals must be engaged as stakeholders in value creation on the same level as enterprises. Convergence of value creation based on individuals'experiences in economy and society necessitates that all enterprises,

whether private, public, or social sector, must engage people both individually and collectively. Private, public,

and social innovation ecosystems have the potential to balance the invisible hand of free markets with the visible hand of governments and civil society, together with stakeholder expectations of more responsible, responsive,

Stakeholder Theory: The State of the art. Cambridge: Cambridge university Press. 4) Pryor, F. L. 2005. Economic systems of Foraging, Agricultural,

and Industrial Societies. Cambridge: Cambridge university Press. 5) Curley, M.,Salmelin, B. 2013.‘‘Open Innovation 2. 0:

‘Saving Economics from the Economists.''Harvard Business Review 90 (12): 36. Contact Dr Venkat Ramaswamy Professor Ross School of business www. venkatramaswamy. com venkatr@umich. edu 105 Oulu Innovation Alliance an Open Innovation Ecosystem

the patient, the doctor, social security, the hospital There are many stakeholders to put sit around the table

Services At this level meaningful services are developed that provide value for the relevant stakeholders. In urban lighting there are often different stakeholders that use the area, with different needs and wishes.

The ultimate goal of urban lighting solutions is to create value for societal stakeholders by creating a healthy and liveable city.

Smart lighting can offer valuable services for different stakeholders using the ICT based lighting platform.

In this four level model, technology is considered an enabler. Technological developments create new opportunities for applications.

and effectively collect data and integrate all data into a total system. 2. Innovation driven by societal needs requires the active involvement of all stakeholders to find solutions that cater for their different needs.

Stakeholders turn from objects to active participants being involved in all stages, including very early ideation and prototyping.

The active involvement of stakeholders is needed also to develop new revenue models that enable the continuous innovation and further development of the services.

By understanding the potential value of innovations for the different stakeholders, also opportunities for co-investment arise.

and use the enabling technology in lighting and ICT to provide solutions that address the needs of the stakeholders.

Different areas in cities have different stakeholders with different needs. The solutions will need tailoring to the specific situation.

For example, an entertainment district in a city has different stakeholders with different needs than a residential area or an area around a school.

For each project it is therefore important to start with an inventory of the specific stakeholders of the area and their needs.

In the redevelopment of the area an investigation was made of the main stakeholders in the area and their needs.

Hospitality Various stakeholders wish to improve the hospitality of the area to attract people and to make them stay in the square for leisure activities.

When looking further in the needs identified by the stakeholders, an opportunity was found in using the same technical system to increase a‘virtual stage'.

This case shows that the technical system enables the creation of various services for different stakeholder needs.

Dynamic lighting service designers These designers need to be able to empathise with the different stakeholders.

they need to extend their scope and research the needs of a wider range of stakeholders.

and provide new services for the different stakeholders. Next to these skills, they also need to understand the impact of lighting on people's mood

'Introduction The crowd-based asset is the new source of innovation and economic growth. Organisations that embrace this new industrial paradigm will prosper.

and, as such, this fluid and interlinked economy presents a vast pool of enormously valuable resource.

Crowd assets are the new source of innovation and economic growth. As the digital world witnesses both declining transaction costs and the emergence of the so called‘grown up digital'demographic as active agents in a commercial setting new models of business,

In 2013, the world witnessed the continued rise of highly-efficient, disruptive shared economy models whereby crowdsourced innovation, drawing on mobile and remote expertise, financed $5 billion of democratised crowdfunding.

In parallel with the emerging class of entrepreneur and small business, incumbent organisations which were founded neither nor shaped in this connected world still have opportunity to create value in this new economy

because they appear to be inherently redundant and of little value in the crowd empowered economy?

without the necessary compass to navigate the opportunity presented in the new crowd empowered economy?

The Web 2. 0 economy has transformed fundamentally the way people interact and communicate. Geographical boundaries are no longer real constraints for organisations.

and a sharing economy. Different players in the value chain come together to create, improve, and deliver new product and service offerings.

Through additional partnerships with The Economist Nature Publishing Group and Popular Science, the network of experts with access to the challenge spans 12 million people.

The crowd asset economy challenges traditional business concepts and theory. In the world of the collaborative and shared economy, with its freemium revenue models where social applications with no revenue can go from launch to being valued in billions of dollars at the time of IPO,

the boundaries of the organisation seem relentlessly transient and value creation models out of step with

One of the main challenges businesses are facing in the sharing economy is defined their strongly traditional and inflexible definition of business model and organisational boundaries.

open and collaborative economy, we cannot take such a rigid and firm view. Instead, we propose a move from this somewhat 2d monochrome world of the industrial economy to a multi coloured 3d perspective in the crowd asset economy.

While the crowd based view may appear challenging it is possible to adapt some more familiar models to showcase the scope of the changes

and so reinvigorate them for the crowd based economy. Figure 1: Original 7s Model Figure 2:

we contend that the true winners in a crowd empowered economy will be the ones who adopt a more wholesale

'The impact of the crowd economy is, however, so profound, driven as it is by economic, societal and technological factors, that,

a practice we have referred already to as a manifestation of the disruptive possibilities of the crowd asset economy.

individual entrepreneurs and early growth companies can solicit donations from individual stakeholders (including friends, family, colleagues, other business owners, etc.

The organisation is rolling this insight out into new products (8). The concept of collaboration is exemplified in the ideas of the shared or collaborative economy.

What more can be done to unlock this crowd asset economy to all? Porter's model demonstrates how the existing Value Chain might be extended to take recognised functions and offer a crowd based twist.

The crowd asset economy is the natural extension of the open innovation principles and we are still at the early stages of this new and exciting period.

and accelerate the adoption of the openness that will drive our new economy. These models and frameworks go some way to help in that process

The economics of organisation: the transaction cost approach. American Journal of Sociology 87 (3): 548 577.5) Howe, Jeff (June 2, 2006.

remembering especially, what happened in the economy when accountants started to be creative; creative accounting was not such a successful social experiment.‘

D.,Docent (Lappeenranta University of Technology) Counsellor, Ministry of Employment and the Economy, Finland mikko. huuskonen@tem. fi Figure 2:

Those who don't may soon find themselves on the outside looking in at a data-centric economy that has moved on without them.

Open Innovation 2. 0 is about extensive collaboration among all the stakeholders in the innovation ecosystem, sharing ideas, results of intellectual creativity and co-creation among all involved.

when a wider spectrum stakeholders participates, thus applying Open Innovation 2. 0 approach, therefore creating better value for the wellbeing of the citizens and businesses.

in order to secure maximum economic and social impact for all the stakeholders involved in Open Innovation 2. 0 ecosystem.

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