Open innovation in telecom

On another website, someone remarked they were working on an article on “open innovation initiatives in the telecom industry.” I said to myself: “Wait a minute, hasn’t someone already done that?”

It’s that a new study isn’t needed, but as a reviewer I would sure expect the author to know this before submitting. Worse case, a research design that doesn’t add to what’s already known could be hard to publish.

Sure enough, I found four papers: two in journals, two in book chapters.

• Dittrich, Koen and Geert Duysters. 2007. “Networking as a means to strategy change: The case of open innovation in mobile telephony,” Journal of Product Innovation Management, 24 (6): 510-521. DOI: 10.1111/j.1540-5885.2007.00268.x
• López Berzosa, David, Manuel Lorenzo, Carmen de Pablos Heredero and Gonzalo Camarillo, “Practising Open Innovation in the Mobile Industry,” in Carmen de Pablos Heredero and David López, eds., Open Innovation in Firms and Public Administrations: Technologies for Value Creation, Hershey, Penn.: IGI Global, 2012, pages 209-220. DOI: 10.4018/978-1-61350-341-6
• Maula, Markku, Thomas Keil and Jukka-Pekka Salmenkaita. 2006. “Open innovation in systemic innovation contexts,” in Henry Chesbrough, Wim Vanhaverbeke, and Joel West, eds., Open Innovation: Researching a New Paradigm. Oxford: Oxford University Press, pp. 241-257. http://www.openinnovation.net/Book/NewParadigm/Chapters/12.pdf
• Rohrbeck, René, Katharina Hölzle, Hans Georg Gemünden. 2009. “Opening up for competitive advantage – How Deutsche Telekom creates an open innovation ecosystem,” R&D Management, 39, 4, pages 420–430. DOI: 10.1111/j.1467-9310.2009.00568.x

There may be others, but these are clearly positioned in their titles as being about open innovation in a telecom setting. (OK, so the Maula et al requires you to go to the title page to see that the 3rd author was then a Nokia employee.)

When ideas "have sex", knowledge recombines

On Wednesday, syndicated reporter/commentator John Stossel offered a provocative essay entitled “Ideas Have Sex, and We're Better for It”:

An idea walks into a bar. She meets another idea. They get together, and nine months later (or maybe it's nine minutes or seconds? It's not clear how it works with ideas), a new idea is born. A baby idea with the best traits of both parents.

When this happens a lot, everyone gets smarter and the world gets better.

Does this man realize how twisted this is? Apparently he has some glimmer:

Did you know that ideas have sex?

It's a weird concept, but the more I think about it, the more right it seems. I learned it from British journalist Matt Ridley.

Ridley, author of The Rational Optimist, says the reason life gets better is that ideas have sex.

“Ideas spread through trade,” he told me. “And when they meet, they can mate, and you can produce combinations of different ideas. I think a good example is a camera pill, which takes a picture of your insides on the way through. It came about (during) a conversation between a gastroenterologist and a guided missile designer ... a process very similar to sex in biology, because through sex, genes meet and recombine, and you get new combinations of genes. That's what causes innovation in biology, and innovation in culture.’

(Sure enough, Ridley himself aired these ideas 18 months ago in a TED talk).

After quoting the original source, Stossel — the anti-government, unabashedly capitalist (but anti “crony capitalism”) libertarian — brings the story back to his ongoing leitmotif:

This didn’t happen because of central planning. It’s the spontaneous market generated from free individuals that sets and keeps it in motion.

However, thinking about this later, the catchphrase “ideas have sex” seems just a provocative metaphor way for standard academic jargon: “knowledge recombination.”

Provocative language aside, the Stossel (Ridley) view is in many ways parallel to that of Eric von Hippel in Democratizing Innovation. Both would advocate policies to promote decentralized invention and individual initiative, with the belief that this would encourage harness widely dispersed creativity and innovativeness. That said, I can see at least two crucial differences.

First, Stossel (being a money-grubbing Austrian-loving capitalist) probably assumes these ideas will be disseminated by new companies, whereas von Hippel is best known for the idea that users solve their own problems without help from companies (even if some of these ideas are later freely revealed to companies). The Stossel view is actually quite consonant with user entrepreneurship — created by two MIT doctoral grads of the user innovation school — although I’m not sure Stossel has heard that term.

The other difference is that von Hippel has a strong preference for weaker intellectual property protection in at least some cases, as in Chapter 8 of Democratizing Innovation. He makes arguments that parallel (and cite) those of Larry Lessig in Free Culture, with both emphasizing the value to society for consumers to have the right to adapt and modify the works of others.

Such a policy would help some companies and hurt others, so it’s not clear how Stossel would come down. Unlike some anti-patent libertarians, Stossel hasn’t taken a strong position either way on IP — other than a strident 20/20 commentary last summer against junk patents and trademarks. Certainly it’s possible to find examples of patent excesses that nearly everyone (even the SCOTUS) would condemn, but others are more controversial.

Still, I see at least one paper here — trying to combine the “ideas have sex” popularization with the “knowledge recombination” scientific literature. This would be a idea recombination that both Stossel and von Hippel should welcome.

What we know about inbound open innovation

Even by my standards, 2011 was a well-travelled year as I flew to conferences in Pittsburgh, Vienna, Johannesburg, San Antonio, Augsburg and San Francisco. (Trips to San Francisco and Berkeley wouldn’t normally be road trips, except that this summer I moved to a new job at KGI in Southern California.)

In some of these cases, I was talking about solar energy, but most of the talks were about innovation openness. In Johannesburg, San Antonio and my visit to Berkeley’s Open Innovation Speaker Series, I was talking about “strategic openness,” my new work on how firms use selective openness to gain competitive advantage; more on this another time. At Stanford in March, I presented an updated version of the open innovation ecosystem paper I’m working on with David Wood.

However, of greatest interest to readers of this blog is the paper I presented in Pittsburgh (at Industry Studies), Vienna (at OUI 2011) and near San Francisco (at MCPC 2011) summarizing the research Marcel Bogers and I have done on inbound open innovation. (Marcel also presented our paper at Ludwig-Maximilians-Universität in Munich.)

At MCPC, Frank Piller and Henry Chesbrough kindly gave me the opening slot on the research program, so I had a full half hour to talk about what we have learned over the past two years. The talk was very well received — perhaps because people were being polite, or perhaps because (like a business school professor) I roamed the hall to make sure people didn’t fall asleep. However, I’d like to think that it also provided a good overview for the academic (and industry) attendees of what we do and don’t know about open innovation.

The paper reviewed some 280 publications on open innovation published from 2003-2010. We found that researchers seemed to be more interested in how firms find external sources of innovation than what they do with them later (or whether these external innovations actually benefit the firm).

Among the few papers that we found that focused on the bottom line were those by Bruno Cassiman and Dries Fames (who also participated in an OI panel discussion during Academy in San Antonio.) I certainly don’t want to suggest that this is the only worthwhile topic for OI research going forward, if for no other reason than it’s not one where I’m likely to do the empirics. However, it does point to the need for researchers to step back and think about when (or how or if) the recent OI fad is actually helping firms be more successful.

The slides from MCPC are up on SlideShare, and a slightly older version of the paper (what we presented at OUI) is on SSRN. We hope to post a newer version of the paper next year (but not tomorrow).

MCPC photo courtesy Bruce Cook Photography.

CFP: User Innovation in RTM

The practitioner-oriented journal Research-Technology Management is soliciting articles for a special issue on user innovation.

Here are excerpts from the call for papers:

The focus of this special issue is users who innovate: how they come to innovate, how they share their innovations, how their innovations diffuse, who profits from them, and how increased user innovation is changing the corporate innovation landscape. User innovation is being spurred by the growth of Internet communities, small-scale fabrication labs, and more open paths to market; investment in user innovations may now rival that of corporate innovation.

RTM is looking for articles that explore the evolving landscape of user innovation and its implications for corporate management of innovation. Specifically we’re interested in exploring studies of user innovation, user communities, partnerships between users and corporations, the role of users in corporate innovation, and impediments to user innovation. The ideal submission will provide concrete examples to support theories about user innovation, community innovation, and corporate implications. Manuscripts that combine examples, theory, and recommendations are particularly sought. Successful submissions will offer readers practical information they can put to work immediately.

To be considered for the special issue, articles should be submitted to the Managing Editor via RTM’s Editorial Manager site at www.editorialmanager.com/rtm by March 15, 2012.

The recommended length of articles is 3,500 words.

Open innovation returns home

Today was the second day of #MCPC2011, more formally the 6th biennial Conference on Mass Customization, Personalization and Co-Creation.

Normally held in Germany or at MIT, this year marked its first appearance on the West Coast. The conference is being held in Burlingame, next to the San Francisco airport, and is hosted by the Garwood Center for Corporate Innovation of UC Berkeley, just across San Francisco Bay.

The theme of MCPC 2011 is “Bridging Mass Customization and Open Innovation.” Not surprisingly, the director of the Garwood Center is Henry Chesbrough, father of open innovation, who is also co-chairing the conference with conference founder Frank Piller.

The day saw a combination of talks by consultants and industry practitioners about open innovation, co-creation, crowdsourcing and related topics. The end of the day brought a concluding talk by Chesbrough, reviewing both his earlier books and his most recent topic, open services innovation from the book of the same name.

He began with a review of the factors leading to the increased prevalence of open innovation

• Labor mobility: instead of one employer, the average engineer has 9 employers
• University research: government used to support most university research. However, “Even Berkeley professors can figure out that if now the money is coming from industry, I need to focus on research questions that industry is willing to fund.“ Stanford, “the second most respected university in California,” has John Hennessy as its president, a serial entrepreneur and current board director.
• Increasing prevalence of venture capital. “Venture capitalists don’t pay for research; they only pay for development,” so the initial research (for such startup companies) must come from somewhere else.

As noted earlier, Chesbrough thinks services are an important area for open innovation, and not just because services are (by some measures) of greater economic impact that products. Certainly services are no longer an afterthought, as when (in Chesbrough’s days as a disk drive manager) customer support was just a cost center.

Instead, services can add value as part of an ongoing feedback process of service creation and refinement. (The slide he showed was similar to one he showed last year, as captured by Maha Shaikh):

The future is not just services, but a platform that integrates both products and services. As an example, Chesbrough cited semiconductor foundry TSMC, which recently announced its “open innovation platform.”