Technische Universität München. Open Innovation. Prof. Dr. Helmut Krcmar. 4 April 2011

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1 Open Innovation Prof. Dr. Helmut Krcmar 4 April 2011

2 Agenda 1 Open Innovation 2 Open Innovation Examples 3 Services und Innovation and the TEXO Project 4 Conclusion and Challenges

3 Classical Innovation Process Ideen Generation Idea collection Idea generation Idea Implementation Idea evaluation Idea selection Idea refinement Idea Distribution Idea distribution Acceptance

4 Closed Innovation Boundary of the Firm Research Projects The Market Research Development

5 Open Innovation Boundary of the Firm New Market Research Projects Current Market Research Development

6 Three Core Processes Inside-Out Outside-In Coupled Source: Enkel/Gassmann/Chesbrough 2009

7 Customer Integration Literature describes three core methods: Lead User Method (von Hippel 1988) Internet Toolkits (von Hippel and Katz 2002) Idea Competitions (Walcher 2007)

8 Requirements for Communities for Innovation Organisational requirements Motivational factors of participants for developing adequate incentives Social framework of the community: norms, rituals, policies, etc. Will the concept work in offline-contexts as well? (e.g., exhibitions) Technical requirements IT-based Internet platform IT-tools for communicating, collaborating, idea visualisation and presentation

9 Agenda 1 Open Innovation 2 Open Innovation Examples 3 Services und Innovation and the TEXO Project 4 Conclusion and Chalenges

10 Example: Innocentive

11 Example: Threadless

12 Example: Dell Idea Storm

13 Example: Starbucks Over ideas

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15 Agenda 1 Open Innovation 2 Open Innovation Examples 3 Services und Innovation and the TEXO Project 4 Conclusion and Challenges

16 Service Innovation Offer methods and tools to develop exciting service ideas create innovative business models involve customers ( Open Innovation ) support innovation professionals foster collaboration Service Innovation Service Consumption Demand Innovation Offering Demand Service Feedback Description Service Match- Matchmaking Making Usage Service Runtime Service Engineering Support the different phases of the innovation process collaboratively develop ideas integrate special-purpose tools provide central repository THESEUS International Symposium, Berlin, June 30, 2009

17 Service Specific Aspects of Innovation Low marginal costs of service delivery High degree of outsourcing Rapid development of new services Transparent service feedback Continuous improvement and deployment Different actors with different capabilities to contribute Large community with large pool of ideas THESEUS International Symposium, Berlin, June 30, 2009

18 Plattform Perspektive on Open Innovation Open Innovation (Gassmann/Enkel, 2004) Inside-out Outside-in Fit to Service Ecosystems (Gassmann 2006) Re-use Knowledge exchange New business models

19 TEXO Service Innovation Process and Framework THESEUS International Symposium, Berlin, June 30, 2009

20 Innovation Repository and Portal Central point of integration Supports full innovation life cycle Integration of special-purpose tools Semantic idea representation (Idea Ontology) Web-based community front-end Web-based management functions THESEUS International Symposium, Berlin, June 30, 2009

21 Innovation Repository 1/3 THESEUS International Symposium, Berlin, June 30, 2009

22 Innovation Repository 2/3 THESEUS International Symposium, Berlin, June 30, 2009

23 Innovation Repository 3/3 THESEUS International Symposium, Berlin, June 30, 2009

24 An Idea Ontology for Innovation Exchange Semantic representation of innovation related information Re-use of established web ontologies Semantic reasoning allows advanced analysis of ideas THESEUS International Symposium, Berlin, June 30, 2009

25 Ontology Hierarchy Top-Level Ontology Domain Ontology Task Ontology Application Ontology THESEUS International Symposium, Berlin, June 30, 2009

26 Solution Design Lab 1/3 Parallel brainstorming and benefit analysis of ideas Up to 24 participants Host co-located workshop Moderator support through flexible agenda tool Integrated into Innovation Repository Linked to Idea Ontology THESEUS International Symposium, Berlin, June 30, 2009

27 Solution Design Lab 2/3 THESEUS International Symposium, Berlin, June 30, 2009

28 Solution Design Lab 3/3 THESEUS International Symposium, Berlin, June 30, 2009

29 Research Project: TEXO

30 Agenda 1 Open Innovation 2 Open Innovation Examples 3 Services und Innovation and the TEXO Project 4 Conclusion and Challenges

31 Take-Aways Traditional Mode of Innovation Internal idea generation is limited Rapid innovation necessary Open Innovation Challenges and Research Issues Outside-In Inside-Out Coupled Motivation of participants Idea management and Idea Visualization Idea selection. Empower the User Customer integration through Open Innovation

32 SAPIENS.INFO

33 Forschungsprojekt: SAPiens.info Internetbasierter Ideenwettbewerb bzw. Ideen Community Ausgangssituation SAP-Anwender haben auf Grund ihres Produktwissens und ihrer Produkterfahrung hohes Innovationspotenzial Internetbasierte Ideenwettbewerbe stellen geeignete Methode zur Hebung dieses Potenzials dar In der Forschung existieren keine Erkenntnisse darüber, wie Ideenwettbewerbe organisatorisch und technisch gestaltet sein müssen, um als effizientes Instrument zur Hebung des Kundeninnovationspotenzials dienen zu können Forschungsziel Wie muss internetbasierter Ideenwettbewerb/ Community organisatorisch und technisch ausgestaltet sein, um möglichst viele und qualitativ gute Innovationsideen zu heben?

34 Forschungsprojekt: SAPiens Dokumentation der Erkenntnisse aus den einzelnen Iterationen im Rahmen von wissenschaftlichen Veröffentlichungen Gestaltung und deren Effekte auf Ideenquantität und -qualität wurden noch nicht untersucht Specifying Learning Diagnosing Action Planning Design von effektiven Ideenwettbewerben /Communities auf der Basis von Erkenntnissen aus Theorie und Praxis Evaluating Action Taking Evaluation vor allem im Bezug auf die Messgrößen Ideenquantität und -qualität Durchführung der Ideenwettbewerbe in Iterationen (SAPiens )

35 IDEA VISUALIZATION

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40 CHALLENGE: IDEA SELECTION

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44 Experiment Design Promote/Demote Rating 5Star Rating Complex Rating

45 Participant Demographics n 313 Mean age years Gender Female: 32.3 % Highest High school: 69.3 % University Bachelor: 25.2 % Degree Master: 5.4 % Quelle: Riedl, 2011

46 Rating Accuracy (Fit-Score) Mean of adjusted fit score ,5 0,2 0,3 Promote/Demote 5-star Complex Rating Scale Quelle: Riedl, 2011

47 ANOVA Results Source Effect of Rating Scale on Rating Accuracy df Sum of Squares Mean of Squares F Hypothesis Supported Between Groups *** Yes Within Groups Total N = 313, *** significant with p < 0.001, ** significant with p < 0.01, * significant with p < 0.05 Quelle: Riedl, 2011

48 ANOVA Results Complex rating scale leads to significantly higher rating accuracy than promote/demote rating and 5-star rating (p < 0.001) Quelle: Riedl, 2011

49 Lessons Learned so far IT-based Open Innovation approaches are very promising, also for Software enterprises. High Interest among participants and initiating companies, target group of users is hard to reach otherwise (cp. v.hippel 2005; Piller/Walcher 2006) Coordination of the activities along the idea evolution process is key to success (cp. v.hippel 2005; Piller/Walcher 2006) Theory-based Design is a viable method for developping succesful IT-platforms (cp. Leimeister et al. 2009) Many different possibilities for supporting the innovation process of software enterprises with IT (cp. Ebner et al 2010)

50 Open Innovation Prof. Dr. Helmut Krcmar 4 April 2011

51 Literature: Chesbrough, H.W. (2003): Open Innovation: The New Imperative for Creating and Profiting from Technology. Harvard Business School Press Books, Enkel, Ellen, Oliver Gassmann, and Henry Chesbrough. Open R&D and Open Innovation: Exploring the Phenomenon. R&D Management 39, no. 4 (2009): Mohr, M.; Wittges, H.; Nicolescu, V.; Krcmar, H.; Schrader, H. (2006): Einbindung und Motivation informeller Multiplikatoren im IT-Training am Beispiel Education Service Providing. In: Wirtschaftsinformatik-Ausbildung mit SAP -Software: Reader zum Track der Multikonferenz Wirtschaftsinformatik 2006 in Passau. Hrsg.: Helmut Krcmar; Claus Rautenstrauch; Holger Wittges; Heino Schrader, 1. Auflage, Eul, Lohmar 2006, S Surowiecki, J. (2005): The Wisdom of Crowds - why the many are smarter than the few. New York: First Anchor Books Edition. Tidd, J., Bessant, J. R., & Pavitt, K. (2005): Managing innovation: integrating technological, market and organizational change (3 ed.). Chichester [u.a.]: Wiley. Walcher, D. (2007): Der Ideenwettbewerb als Methode der aktiven Kundenintegration. 1. Auflage, Deutscher Universitäts-Verlag, Wiesbaden 2007.