International Master – Innovation seminar
UTSeuS international research seminar, 23-UTSeuS international research seminar, 23-24th of october 0724th of october 07
Pascal Jollivet (Costech)Pascal Jollivet (Costech)
UNIVERSITÉ DE TECHNOLOGIE COMPIÈGNE
Connaissance, organisation et systèmes techniquesCOSTECH
Ascending Innovation : economics and management
Business & economic models for
Ascending/Eco-systemic/Open Innovation
Pascal Jollivet
COSTECH research lab’ (EA 2223), collegium CNRS-INSI
UV SICMaster UTC Mention IC M1
Academic year [email protected]
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1. Ascending innovation : similarities
Ascending innovation/bottom up innovation ? Network-Ascending innovation/bottom up innovation ? Network-innovation !innovation !
Pyramidal/”Flat” organization. Pyramidal/”Flat” organization. Hierarchy/control (commandment) Hierarchy/control (commandment) Conception/executionConception/execution Reticular cooperative organization Reticular cooperative organization
of workof work–
Innovation impulse by Innovation impulse by the base ? From the hori-the base ? From the hori-zontal network !zontal network !
Jollivet, Ascending Innovatio, Shanghai , dec. 2013
1. Ascending innovation : similarities (2)
Crowdsourcing / contributive model / Ascending Crowdsourcing / contributive model / Ascending Innovation …Innovation …
Innovativeness ; Control/initiative ; distributed Innovativeness ; Control/initiative ; distributed governance/centralized owner/common; production/valuing-governance/centralized owner/common; production/valuing-monetizing;monetizing;
Crowdsourcing : Crowdsourcing : internalization/externalisation (outsoucing)/crowdsourcinginternalization/externalisation (outsoucing)/crowdsourcing a “center” that sources (centralized “valuing”/monetizing)a “center” that sources (centralized “valuing”/monetizing)
Contributive model : no centralized “valuing”/monetizing entityContributive model : no centralized “valuing”/monetizing entity
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The end of the structural dichotomy between :The end of the structural dichotomy between : Producer and consumer (Prosumer? FabLabs ? Hacker ? User-innovator)Producer and consumer (Prosumer? FabLabs ? Hacker ? User-innovator) Offer and demand (economics of contribution, wikinomics)Offer and demand (economics of contribution, wikinomics)
Democratization of innovation ?Democratization of innovation ? more actors, more “non-profemore actors, more “non-profe
sionals”, more outside of (big) sionals”, more outside of (big) companiescompanies
User-producerUser-producer Internalization/externalisation ./Internalization/externalisation ./
crowdsourcing … crowdsourcing … democratization of innovation ? democratization of innovation ? (KickStarter, Google Summer (KickStarter, Google Summer of Code, FLOSSof Code, FLOSS
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1. Ascending innovation : similarities(3)
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1. Ascending innovation:planning/serendipity
Serendipity : The impossible planning of innovation? Serendipity : The impossible planning of innovation? Planning innovation, an oxymoron ? Planning innovation, an oxymoron ? Solution ? Preparing for the non-forecastable : engage ain a Solution ? Preparing for the non-forecastable : engage ain a
serendipity processserendipity process
Decision making for Decision making for innovation/start up : innovation/start up : predictive logic predictive logic vsvs effectual logic ? effectual logic ? SarazvatySarazvaty
Jollivet, Ascending Innovation, Shanghai , dec. 2013
1. Ascending innovation : outcome/ecosystem
Product, process, service innovation? No : system Product, process, service innovation? No : system innovation (as platforms) ! innovation (as platforms) ! CEO Nokia re. Android & Apples eco-systemsCEO Nokia re. Android & Apples eco-systems
Produce an output ? Design anProduce an output ? Design an outcome ! outcome ! Experience a MMORPG ! Experience a MMORPG !
Experience design. Experience design. My GO “experience” : emotion My GO “experience” : emotion
in tele-presencyin tele-presency
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1. Ascending innovation : Business Models (the market of derivatives) Fee of Free ? Paying of Gratis ? Fee of Free ? Paying of Gratis ?
“Is there nothing as free lunch”? “Is there nothing as free lunch”? Freemium !!Freemium !!
Deezer, SpotifyDeezer, Spotify Youtube, Facebook … Gmail !!Youtube, Facebook … Gmail !!
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Sell product ? (the market of derivatives) Sell product ? (the market of derivatives) MonetizeMonetize (use value) experience ! (use value) experience !
Sell “gadgets”/derived goods (additional Sell “gadgets”/derived goods (additional powers) on Online Gamespowers) on Online Games
Selling a product? New business modelsSelling a product? New business models How to build use-value experience (functionality focused) for How to build use-value experience (functionality focused) for
the user . How to monetize his experience? the user . How to monetize his experience? Market value / use value /monetizing … Market value / use value /monetizing …
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1. Ascending innovation : Business Models (the market of derivatives)
Sell the owning of an object? Rent the Sell the owning of an object? Rent the access to/the use of … a service/access to/the use of … a service/a “function”a “function” The economics of service/functionnalityThe economics of service/functionnality
Separate profit from non-profit? Design “hybrid” Separate profit from non-profit? Design “hybrid” public/private goods public/private goods (private service/public services) ! (private service/public services) !
* Gmail … * JP Decaux AbrisBus * Gmail … * JP Decaux AbrisBus (Bus Stop with advert ) (Bus Stop with advert )
– * Velib/e-car !* Velib/e-car !
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1. Ascending innovation : Business Models : access / hybrid
Selling time of attention (to advertisers ): The economics Selling time of attention (to advertisers ): The economics of attention of attention P. Lehaye (former CEO TF1 TV, France) : “We sell time of P. Lehaye (former CEO TF1 TV, France) : “We sell time of
available brain ! ” (i.e. mn. of attention). available brain ! ” (i.e. mn. of attention). Which differentiation /competitors (other advertiser’s providers) ? Which differentiation /competitors (other advertiser’s providers) ?
Personalized advert : relevancy re. watcher’s interests Personalized advert : relevancy re. watcher’s interests -> more qualitative “attention” to the advert-> more qualitative “attention” to the advert Minimalism of the advert (a “sponsored link”, not a banner) : less Minimalism of the advert (a “sponsored link”, not a banner) : less
disturbance/less cognitive cost for the final user disturbance/less cognitive cost for the final user -> more -> more qualitativequalitative “attention” to the advert “attention” to the advert
How to “monetize” How to “monetize” qualitativequalitative “attention” (not only “volume” of “attention” (not only “volume” of the audience/public) ? the audience/public) ?
A higher number of click per exposition to an advertA higher number of click per exposition to an advert -> a better ratio of performance of advert -> a better ratio of performance of advert -> a higher price to sell the “outcome” (attention) ! -> a higher price to sell the “outcome” (attention) !
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1. Ascending innovation : Business Models : Gmail/Gsearch (1)
Jollivet, Ascending Innovation, Shanghai , dec. 2013
Dimensions of innovation
Case (simplified)
Offer (use value) Innovation : Product ? No. Process ? Little. Service ? Cloud. Outcome ? Experience : qualitative « attention » of the « user ».
Bus. Model Selling the « soft advert » exp. of watcher to advertiser.Monetizing ? Better ratio of click per exposure : higher price of advert !
Sourcing(in/out/crowd)
Crowdsourcing : attracting max users/audience (crowd) through delivering a « public good » (Gmail) + having them produce content (mails) + datamining the contents
Eco-system The use value of Gmail is strengthened by each other “service” part of Google’s “offer”, thought integration (G.Drive-G.Doc/Agenda/ “G+”, Android on Smartphones … ). Externa-lities of each service are therefore internalized in the System.
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1. Ascending innovation:Business Models : Gmail/Gsearch (2)
Jollivet, Ascending Innovation, Shanghai , dec. 2013
1. Ascending innovation : Complex systems, ecosystems Def. : Def. : ComplexComplex System (math) System (math)
Many variablesMany variables Many interactions;Many interactions; Non linear « rules »Non linear « rules »
Ex : The study onEx : The study on
the the motivationmotivation
to contribute to contribute to to
Wikipedia.Wikipedia.
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Global Economy Dynamics as a complex system
1. Ascending innovation : Complex systems, ecosystems
Complex system (Def : Complex system (Def : ~sociology ) ~sociology ) The system is more than the The system is more than the some of its parts : collective some of its parts : collective
intelligenceintelligence
Ex : Collective Ex : Collective intelligence : the intelligence : the MIT/Canadian MIT/Canadian Experimental Experimental Psychology/Management Psychology/Management Research of the collective Research of the collective performance on a team to performance on a team to solve simple/complex solve simple/complex problems.problems.
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1. Ascending innovation : Complex systems, ecosystems
EcoEco-system (complex)? -system (complex)? Self regulation : Self regulation : unlike simple automats Command/control that need unlike simple automats Command/control that need
human intervention in case of unpredicted/unexpected perturbating event. human intervention in case of unpredicted/unexpected perturbating event. Like feed back integration in cybernetics. Like real biological eco-Like feed back integration in cybernetics. Like real biological eco-systems adapting to changing environment. systems adapting to changing environment.
So that it stays« alive » So that it stays« alive » (non-anthropic : reproduction, adaptation)(non-anthropic : reproduction, adaptation)
Bio-mimetics dynamics Bio-mimetics dynamics (ex : predation/ co-evolution).(ex : predation/ co-evolution).
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1. Ascending innovation Protecting/sharing knowledge
Protect your ideas ? Share knowledge ? Protect your ideas ? Share knowledge ? Enclosure/disclosure of knowledge for innovationEnclosure/disclosure of knowledge for innovation
Benefits from protecting (enclosing) for innovation ? Benefits from protecting (enclosing) for innovation ? Preventing against copy from competitors (supposedly) ;Preventing against copy from competitors (supposedly) ; Preventing (potential) competitors to innovate ?Preventing (potential) competitors to innovate ?
Ways of legally protecting innovation with IP:Ways of legally protecting innovation with IP: Patents, copyrights (models, brand … ) and … secret !Patents, copyrights (models, brand … ) and … secret ! Not every “applicable novelty” can legally be patentedNot every “applicable novelty” can legally be patented
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1. Ascending innovation Protecting/sharing knowledge
Strategic practices of patenting : the evolution of IBMStrategic practices of patenting : the evolution of IBM From exclusive “in sourcing/using/valuing” of patents (5%).From exclusive “in sourcing/using/valuing” of patents (5%).
Indirect internal monetization of knowledge through incorporation in Indirect internal monetization of knowledge through incorporation in products/servicesproducts/services
To direct external monetization of knowledge To direct external monetization of knowledge through selling/renting patentsthrough selling/renting patents
New high profit-making strategic practice/business model New high profit-making strategic practice/business model re. patents : patent Troll !re. patents : patent Troll ! Buying patentsBuying patents To threaten small/medium size high tech companies of trial if they To threaten small/medium size high tech companies of trial if they
to pay for licencesto pay for licences
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1. Ascending innovation Protecting/sharing knowledge
Benefits from sharing (disclosing) for innovation ?Benefits from sharing (disclosing) for innovation ?i.i. Share knowledge/project ideas to “interest”/involve/attract Share knowledge/project ideas to “interest”/involve/attract
potential partners and ease the adoption (diffusion) of your potential partners and ease the adoption (diffusion) of your innovation !innovation ! - P2P on music : piracy or marketing gains (free “promotion”) ? - P2P on music : piracy or marketing gains (free “promotion”) ?
ii.ii. Enabling crowdsourcingEnabling crowdsourcingiii.iii. Self-reinforcing dynamics : the more you share knowledge, the Self-reinforcing dynamics : the more you share knowledge, the
better it becomes (improvement)better it becomes (improvement)
Ex : California Spirit vs French ? The different Ex : California Spirit vs French ? The different feelingsfeelings & & practices practices about patentsabout patents in the 2 territories in the 2 territories
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1. Ascending innovation Protecting/sharing knowledge
Innovation dilemma re. Intellectual Property (IP) ?Innovation dilemma re. Intellectual Property (IP) ?1.1. Opening/sharing/diffusion knowledge increases innovation Opening/sharing/diffusion knowledge increases innovation
(at least at global scale) : self reenforcing process(at least at global scale) : self reenforcing process2.2. Monetizing knowledge requires building enclosure (that prevent Monetizing knowledge requires building enclosure (that prevent
diffusion)diffusion) A dual slope (hybrid) model of valuing knowledge for A dual slope (hybrid) model of valuing knowledge for
innovation ?innovation ?
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1. Ascending innovation Protecting/sharing knowledge Strategies to transcend the dilemma : Google vs Apple ?Strategies to transcend the dilemma : Google vs Apple ?
Google : the Google : the dual slopedual slope IP strategy : IP strategy : Enclosure ? Enclosure ?
• Includes Patents ! Includes Patents ! • Motivation : don’t be evil : only for protection against patents threat from Motivation : don’t be evil : only for protection against patents threat from
others, non for “aggressive” use…others, non for “aggressive” use… Disclosure ? Disclosure ?
• Chrome, Android Floss, Google Summer of Code … Chrome, Android Floss, Google Summer of Code … The The tricktrick to keep global control on the eco-system ? Functional to keep global control on the eco-system ? Functional
systemic dependency beetween the 2 (ex : Android Consortium). systemic dependency beetween the 2 (ex : Android Consortium).
Apple : the enclosure (main) option and the patent threat to Android Apple : the enclosure (main) option and the patent threat to Android ecosystem strategic ( and Google). ecosystem strategic ( and Google).
Main practices re. patents from big IT firms ? Main practices re. patents from big IT firms ? • Preventing competitors to innovate ! Preventing competitors to innovate ! • Biggest financial issues re. patents : Apple vs Samsung trial … with Biggest financial issues re. patents : Apple vs Samsung trial … with
Android and Google as final targetAndroid and Google as final target 19Jollivet, Ascending Innovation for Complex Cities, UTC, 2013
Dimensions of innovation
Gmail Case (simplified)
Ethics of Work : Fun/work ?
We are google bees ? Tacit worker ?
Intelectual Property : Open/closed knowkedge ?
Selling the « soft advert » exp. of watcher to advertiser.Monetizing ? Better ratio of click per exposure : higher price of advert !
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1. Ascending innovation :Business Models : Gmail (3)
Jollivet, Ascending Innovation, Shanghai , dec. 2013
Conclusion (of part I – Issues/conceptual tools )
Innovating, today ? Innovating, today ?
Requires exploring/answering such Requires exploring/answering such a multidimensionnal « complex (eco)system », a multidimensionnal « complex (eco)system »,
Now: let’s explore it through (real) Ascending Now: let’s explore it through (real) Ascending Innovation case studiesInnovation case studies
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Dimensions of innovation
Apple Case (simplified)
Offer
Bus. Model
Sourcing(in/out/crowd)
Eco-system
Ethics of Work (Fun/Work).
I.P. (ouvert/fermé connaissance).
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1. Ascending innovation:Business Models : Apple.
Jollivet, Ascending Innovation, Shanghai , dec. 2013