May 6, 2010

Distributed Perspectives on Innovation

After 17 hours on an airplane (and then train) from San José, on Wednesday morning I arrived in Göttingen in the former Electorate of Hanover.

The reason was to keynote a workshop entitled “New Forms of Collaborative Production and Innovation: Economic, Social, Legal and Technical Characteristics and Conditions.” The workshop was intentionally interdisciplinary — attracting academics from law, economics, sociology, computer science. It attracted participants from around Germany — including lots of German PhD students — as well as a few other Europeans and two North America-trained lawyers.

The event was hosted by Sociological Research Institute (SOFI) and held at Lichtenberg Kolleg of the Georg-August-Universität Göttingen. The university was created by and named after Georg, Prince of Hannover (who was father of America’s least favorite King, George III). The event was held in the green room of the Carl Gauss’s former observatory.

Wednesday afternoon I gave the initial keynote, followed by a second keynote by the well-known and beloved user innovation researcher Frank Piller. (Once his slides are posted I’ll blog on some of his interesting ideas.) Frank & I were introduced by one of the conference organizers, Herr Doktor Volker Wittke of SOFI.
My talk was entitled “Distributed Perspectives on Innovation: Open Innovation, User Innovation and Beyond.” As a keynote, I had 50 minutes (plus Q&A) so it’s longer, broader and deeper than a typical academic paper. My slides are up on SlideShare or I can email a PDF, and yesterday I posted links to many of the key references.

Because of the audience, I began the talk with an overview of O/U/CI adapted from several previous talks and my 2009 paper. I then summarized the discussion of innovation commercialization modes that’s the core of the paper that Marcel Bogers and I will be presenting at the Academy of Management conference in Montréal.

From this, I presented the audience with some questions and research opportunities:
  • The call to pursue more precise research on the community construct.
  • Does the chronic problem of sponsors sharing control with open source communities mean that firms are only as open as they (cynically or instrumentally) need to be?
  • My ongoing question about whether crowd-sourcing is open innovation or user innovation?
  • Another earlier question — one I perhaps dodged in the 2006 book chapter — of whether monetizing knowledge flows in OI produces socially suboptimal results. (A common view in CI research, perhaps heresy in OI research).
  • Is “open innovation” (use of external innovations) being used as a substitute rather than a complement to internal innovation capabilities?
Seriously jet-lagged, I scribbled some notes on the subsequent Q&A: my notes are better on the answers than the questions [and I also added other ideas after the fact.]

The first two questions centered on the value network slide, which I developed while teaching open innovation, used in previous talks, and is Figure 1 in the West & Bogers AOM paper.
The first question was whether there are sectoral differences in OI/UI. Chesbrough (2003) emphasizes the hardware business of Xerox PARC, while a lot of user innovation examples are about open source software. To this I had came up with three basic ideas:
  • The recent paper of Christina Raasch notwithstanding,
  • Users can produce software but not tangible goods, so user innovation works better for software [and other information goods.] Exceptions have been studied by Christina Raasch and colleagues [who spoke about this on Thursday morning.]
  • As would be evident to readers of Carliss Baldwin, the IT industry embraces open innovation because the modularity of architecture and well-defined interfaces enables component-based business models
  • Other industries have [perhaps for path-dependent reasons] been more integral and less open. Take the auto industry, which uses a vertically integrated model similar to 1900. But perhaps in 2050, we will have a more modular auto industry with standardized batteries and other components.
The second question asked about different forms of collaboration among the actors in this stylized value network.

I argued that our diagram is perhaps misleading because it emphasizes positional roles, but there are attributes of the collaborator that may be more important for firms to manage the collaboration process.
  • Is the collaborator a firm or an individual? Open innovation emphasizes [dyadic] firm partners, whereas user innovation is normally about individuals. The forthcoming Journal of Management paper by Bogers, Afuah and Bastian does talk about firm users (which they inexplicably label “intermediate users”), and of course the first von Hippel (1988) book highlighted engineers innovating scientific instruments at work
  • Scale of collaborators. If a company is providing batteries to Nokia, they may have several engineers working full-time collaboration.. If I am giving feedback to Google as a user, I might spend 10 minutes once a month offering my suggestions. So the tools and processes and learning curve for enabling the collaboration will be very different [for the deep vs. shallow collaborations.]
  • Number of collaborators. If I’m Nokia, I might have 2-3 different component suppliers for several key product categories, and thus the firm might have 10? 50? suppliers of major components. If I’m Apple, I have 100,000 third party app developers, [while Google would have 100s of millions of users.] So the processes for managing collaboration would be different for dozens vs. millions of collaborators.
I hope to have other posts on the workshop next week.

Photo credit: Herr Doktor Frank Piller.

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