Sam Inkinen Open Innovation and Web 2.0

Open Innovation The cultural requirements for Web 2.0 powered innovation, networking, and collaboration Dr. Sam Inkinen Senior Researcher Finland Futures Research Centre www.inkinen.org – www.cid-lab.org

Artist: Lotta Viitaniemi, Story: Kim Forsman & Teemu Arina Dicole Ltd.

Changes on the web WEB X.O

Web as a platform Photo: Christopher Chan

Software above a single device Photo: *One*

Data as the new Intel inside Photo: _fabrizio_

Harnessing collective intelligence Photo: Donna Cymek

Rich Internet Applications (RIA, AJAX)

Lightweight business models, e.g. SaaS (Software as a Service) Photo: ulterior epicure

Long Tail Head (20%) r we po g erin Sign lt dﬁ al v uire s. n eq ois R e Sales Tail (80%) Products Ref: Chris Anderson

“The project would have been a success if everything had gone as we planned.”

“Everything would Myth work out if we had the right information at the right time at the right place.”

Culture The integrated pattern of human knowledge, belief, and behavior that depends upon the capacity for learning and transmitting knowledge to succeeding generations. – Merriam-Webster Online Dictionary Photo: Shapeshift

Connecting Anonymous voting 1) Open conversation 2) Prediction markets 3) Many Minds Internet crowdsourcing 4) Ref: Cass R. Sunstein, Infotopia

Examples Anonymous • Kasparov vs. Internet team • Estimating temperature Voting • “Ask audience” in Who Wants to be a Millionaire • Movie ratings in IMDB • Youtube video ratings

Why groups can be wise? Condorcet Jury Theorem Marquis de Condorcet, 1743 - 1794

Wise Diversity of opinion 1) Independence 2) Decentralization 3) Crowds Aggregation 4) Ref: James Surowiecki, Wisdom of the Crowds

Conversation Each of them by himself may not be of good quality; but when they all come together it is possible that they may surpass – collectively and as a body, although not individually – the quality of the few best. – Aristotle on Collective Intelligence, Politics, circa 334-23 BC.

• Groupthink and unthinking Traps • Ampliﬁcation of falsehoods • Strategic behavior • Use of heuristics • From conﬁdence to extremism • Focus on personal prospects • Design by committee Photo: Mike9Alive

Design by Committee

Filters Weak • Surveillance filter • Mentality filter Signals • Power filter – Dr. Igor Ansoff, 1984 Photo: .supernova.

• Group polarization • Reputational cascades • Informational cascades Biases • Hidden proﬁles • Social pressures • Common knowledge effects • Algorithmic bias (e.g. Google)

Diversity of Thought is Accuracy of Thought

What doesn’t ﬁt in? 3 2 1 Cow Chicken Grass Ref: Richard Nisbett

1) Economic incentives Prediction motivate participation 2) Disclosing information is crucial for winning Markets 3) Those who do not know, will step aside

Ecosystem way: Internet Crowdsourcing Photo: Hugo*

What is Innovation? An idea becomes an innovation ■ only through wide adoption, either through: ■ centralized resources (traditional innovation) ■ decentralized resources (open innovation) commons-based peer-production

How’s your innovation pipeline? Photo: Pavlos Pavlidis

Traditional Innovation

Open & Organic Innovation Photo: ippei + janine

What kind of innovation? Challenge: Challenge: Business model new ways ecosystem innovation to capture value innovation What you innovate Changing the what Challenge: Traditional Product & be an innovation Changing service innovation product the how partner of choice development Closed Open How you innovate Source: Henry Chesbrough, 2007

Future Challenge In the future, organizations will compete on: Who is able to create a rich user community improving their products where users want to belong Image: Felippe Torres

“There’s something fundamental about organizations and leadership that makes it almost impossible for people inside a business to change their own industry. Industries are based on formats that are basically legacies of military hierarchies” Ricardo Semler Semco Kuva: GustavoG

“Virtually everything new seems to come from the 20 percent of their time engineers here are expected to spend on side projects. They certainly don't come out of the management team” Eric Schmidt Google CEO Kuva: GustavoG

Participation Inequality 1% creators 10% synthesizers 100% consumers Ref: Bradley Horowitz, Jacob Nielsen

Participation Power Law Ownership High Moderating Engagement Collaborating Reﬂecting Recommending Linking Commenting Tagging Rating Subscribing Low Reading Threshold Collective Collaborative Intelligence Intelligence (implicit creation) (explicit creation) Ref: Teemu Arina, based on Ross Mayfield

Winner of World Summit Award Finland 2009 in e-business & category CASE

portrait details + Add contact Itämerenkatu 30 A 10 jaiku FI-00180 Helsinki, Finland teemu@dicole.com Teemu Arina facebook Blog: tarina.blogging.fi “All progress depends Skype: infe00 on the unreasonable man” Phone: +358 - 50 -555 7636 ‣ Edit details employer ‣ Upload photo Professional description CEO, founder “ I seek to understand the changing friends Dicole Oy nature of organizations as they shift from the industrial era to the knowledge Kansakoulukuja 3, 2 krs. ‣ See all intensive era. What new methods, FI-00100 Helsinki, Finland structures, skills and tools will they +358 - 50 - 555 7636 need? As an entrepreneur, programmer, +10 teacher and designer I design, build and Digitalization deliver web-based interaction grade technology (or social software) that enables people to co-create together in community stats a distributed knowledge intensive ‣ Edit employer environment.” Last online 6 minutes ago Submitted ideas 32 Comments 40 education Points received 54201 Ranking position 4. School HSE Skill profile Degree Bachelor “Technology is my sixth sense.” Other degree Knowledge kung-fu tags of interest Target degree Evil priest case Challenge Digitalization ‣ Edit education e-banking e-invoicing eu idea

Dicole Innovation Work Environment CASE

Blogs Networking Wikis Tags Seeds Media Feeds

Organic Enterprise Nervous system Brain Feeds, Search, APIs - Wikis, tagging - Sharing, discovering and Connecting and remixing tapping into reflections reflectons Blood system Senses Social networking, Blogs, Media - Real-time Reflection in and on action communications, Network analysis - Optimizing interaction flow Skeleton Automation, Real- time processes, Operative technologies - Back- bone for business processes Ref: Teemu Arina, Illustration: Lotta Viitaniemi

Command & Control should become Collaboration and Communication Photo: tashland

Contact Dr. Sam Inkinen Senior Researcher sam.inkinen@cid-lab.org www.cid-lab.org www.inkinen.org Photo: Markus Koljonen “Imagination is more important than knowledge.” – Albert Einstein

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Sam Inkinen Open Innovation and Web 2.0

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