The document discusses methods and tools for enterprise innovation in a networked economy using a knowledge-centric approach. It proposes a virtual innovation factory (VIF) that operates in an innovation space, transforming raw and enabling knowledge into new working knowledge and final products through a value production chain. The VIF is intended to facilitate open innovation using a social semantic knowledge management platform to manage enterprise documents in a semantically enriched way using ontologies. The goal is to support continuous business innovation through knowledge management and transformation of enterprise processes, products, and technologies.

1. London, City University, 19 June 2012
Methods and Tools for Enterprise Innovation in
the Networked Economy: a Knowledge-centric
Approach.
Michele Missikoff
LEKS, CNR-IASI
Polytechnic University of Marche, Ancona
1

2. Creditis
• Large part of the content of this talk has been
elaborated within the European Project BIVEE:
Business Innovation in Virtual Enterprise
Environments.
• BIVEE is a 3 years project (ends Aug 2014) with 4.3
M€ budget and 10 partners :
Engineering (It) UnivPM (It)
BIBA (De) TAL (UK)
BOC (At) SRDC (Tr)
ATOS (Es) AIDIMA (Es)
CNR (It) Loccioni - GI (It)
Proceedings: http://ceur-ws.org/Vol-864/

3. Innovation in the Context
Current Scenario – The world, and Western
economies in particular, are traversing a
critical phase that requires to enter an era of
deep changes
The changes will take place along three main
dimensions:
• The technology dimension
• The socio-economic dimension
• The political dimension (... but I’ll skip this ;-)
3

4. Technology dimension
Among the key technological innovations of the
last period, we may cite:
• Cloud Computing,
• Service Oriented Architectures (SOA) and
SaaS (Software as a Service),
• Internet of Things and Smart Objects,
• Semantic Web, ontologies, and Linked Data
• Social Media, entering in the enterprise world
4

5. Socio-economic dimension
• Western countries cannot continue to grow at the rate
of the previous decades
• The current development model has reached an end
• Continuous growth of production and consumption
(and waste disposal) is unbearable
• New value systems are emerging (ref. Stiglitz, Sen,
Fitoussi report; S.Latouche and the ‘graceful
degrowth’)
• Towards a development model where the quality of
life is loosely connected to the possession of goods
• Innovation need to be re-considered in light of the
above concerns 5

6. Vision
• To overcome the crisis, EU enterprises need a deep
change
• Introducing continuous improvement and innovation
to remain competitive in the globalised economy
• Sustainable Innovation rather than expansive
innovation
• Focusing on Enterprise Software
– Vital infrastructure for businesses and socio-
economic systems, but …
– ‘hindering factor’, wrt the speed and flexibility
required by markets and business innovation
• We need to put Knowledge in the center, to guarantee
• Continuous alignment of Business needs and
Enterprise Software Applications in ever changing
enterprises

7. 1. What is Business Innovation?
Business Innovation is a designed, managed
transformation of some aspects of the enterprise
(or the society, the city, etc.) aimed at a
substantial improvement of:
• the quality of delivery products (goods, services)
and the customer satisfaction,
• production processes and workers satisfaction
• cost reduction and/or revenue raise
• In a sustainable way (respectful of working
conditions, social context, environment, ...)
7

8. Business Innovation: Where?
• Products (goods / services)
• Production / Admin processes
• HR competencies, skills, capabilities
• Organization models, with new delegation patterns
• Enterprise information organization and flow
• Markets and marketing styles
• Customer relationships
• Suppliers and partners strategies and management
• Technology adoption, deployment, renewal strategies and
practice
• Financial and control styles, methods, and tools
• Quality of working life and ambient
• Relationships with the territories, the people, the
environment, local cultures
8

9. Business Innovation: How?
Scope
Business Innovation: Goods, Services, Processes with ICT
Approaches
push-mode and technology driven, when generated on
the supply side;
pull-mode and demand driven, when requested by the
market/demand side;
co-creation, when all the stakeholders cooperate
together to generate product or process innovation.
Endogenous, when ideas come from within the
Ecosystems
Exogenous, when ideas come from the rest of the World

10. Enabling Business Innovation
• Create the right environment, working conditions
• Grassroots innovation (beyond Toyotism ...)
• Open innovation (but controlled), with systematic and
ad-hoc relationships with
– universities , research centres, partners, suppliers and
customers
• Facilitate info / knowledge / ideas circulation within
and outside the enterprise
• Culture of cooperation (rewarding system)
• Scouting
– Technology
– Market
– Excellence centres
• Observatories on opportunities, problems, threats, ... 10

11. On the Nature of Business Innovation
• Innovation ... Is it a process?
• What is its relationship with Knowledge
Management?
• What is its relationship with Change
Management?
In essence, it is a Transformation, but in a rather
fuzzy context:
• Fuzzy starting point (we never fully know the
reality)
• Fuzzy ending point (is there an end ...?)
• Uncertainty on how to get there ...
11

12. The Nature of Business Innovation
• Whatever you innovate, firstly you change your
behaviours
• Knowledge Management is not sufficient
• You need Knowledge at Work (pargmetics)
KW
• Knowledge capable of modifying your working
style, your environment, your culture, ...
– HR continuous training, formal and ‘on the job’
• In the Enterprise, KW will modify your
organization, BP, Info Flow, ... the Value Production
Space
12

13. Innovation New Knowledge
Knowledge about
• enterprise and its organization
• competencies, skills, and capabilities
• problems and improvement opportunities
• products and services
• Knowledge about the production processes,
methods
• Technologies, systems, and resources
• Markets, clients, partners and competitors
13

14. Enterprise Model 4 BusInnov
STRATEGY
innovation
MARKETING
ORGANIZATIONAL
innovation
innovation
BUSSINESS
innovation
PRODUCT
innovation TECHNOLOGY
innovation
SERVICE PROCESS
innovation innovation
(Scource: BIVEE Deliverable D2.1 – BIMF: Business Innovation Modeling Framework)
14

15. Innovating Innovation
• Towards Open Innovation
• A systematic approach to Innovation,
nurturing creativity and ideas generation
• Innovation as intangible goods
• ‘Manufacturing’ approach to Innovation
• The need of new production/organization
models
• Virtual Innovation Factory (VIF), operating in
the Innovation space
15

16. Virtual Innovation Factory
Raw /
Enabling Buz KR Onto
Knowl Data
K Value Chain New
Working
The learning Organization Knowl
(intangible dimension )
(concrete
dimension)
Raw
Final
Materials, Bus Value Chain
Product
Spare Parts
(MountainBike,
(Frame, Saddle,
CityBike, ...)
Wheels, Speed-
Shift, ... ) Real world enterprise 16

17. Organising Open Innovation
• Traditional organization models are too rigid, not
suitable for creativity and innovation
• Breaking the schemes, subverting the hierarchies
• New approaches also for the protection of
intellectual property rights (IPR)
(http://opensource.com/business)
17

18. Business Innovation Space
• The (often unpredictable) Innovation paths
Innovation path
link
Innovation unit
Unit
??
• Is Innovation a PROCESS? How repeatable?
18

19. Production space transformation
Value Production
Space with old PPx
Production Process DocSet X
X
Innovation Space
yielding new PM
Value Production
Space with new PPx’ DocSet X’
Production Process
X’
19

20. Innovation as a Meta-Transformation
• Production process transforms the reality
• Innovation transforms the production process,
to achieve:
– A new (or renewed) product
– To produce in a new fashion
– To produce for a new market ...
Innovation
=
Designed Enterprise Transformation
20

21. Designed Enterprise Transformation
DET =
• Set of Enterprise Goals (EG)
• Current Organization (CO)
• Current Enterprise Processes (CEP)
• Current Products and Services (CPS)
• Current Adopted Technologies (CAT)
• KPIs on the above (KPI)
DET: Transformations that make EG true (or
‘sufficiently’ approximated)
21

22. Transformation
Products and services
• DET(CPS)  New Org (NPS)
Enterprise Processes
• DET(CEP)  New Enter Processes (NEP)
Adopted Technology
• DET(CAT)  New Adopted Tech (NAT)
Inducing therefore, organizational changes
• DET(CO)  New Org (NO)
det(cps, cep, cat, co) 
eg(nps, nep, nat, no) = ‘true’*
22
(* or above a given fuzzy threshold)

23. What is BIVEE?
• A Virtual Enterprise Environment, to be integrated
with existing Enterprise Software Applications (ESA)
• Distributed, collaborative, knowledge-intensive
framework
• A Platform for networks of networked, interoperable
virtual/real enterprises
• To be used directly by Business Experts, pushing for
disintermediation (wrt techies) in innovation KM
• Innovation Observatory to push Open Innovation:
– involving the largest number of people
(Crowdsourcing)
– Exchanging information with the rest of the world
(universities, international research labs, etc.)

24. Document-centric approach
• Towards a full digital enterprise, all relevant
information is digital (see UDE: Unified Digital
Enterprise, FInES Research Roadmap)
• Everything is documented, by people for people
• What is not documented does not exist ... !!!
• The enterprise knowledge is captured by a wealth
of document collections (Pre-KB)
• Documents need to be semantically enriched
• Partitioning the Knowledge Space according to
– document categories
– Knowledge categories (ontologies)
24

25. Enterprise Doc Categories
• Business Doc: describe the business transactions
(invoice, Req for Quotation, Order, ...)
• Actors & Roles Doc: describe the competencies, skills,
and capabilities, useful invalue production (Yellow Pg)
• Domain Doc: capture the industry sector (Catalogues,
BoM, ...)
• Process Doc: describe the production process (plan,
build, manange, ...)
• Performance Doc: describe the indicators and the
measuring methods, to keep performance under control
(measurmenet methods, KPIs, ...)
• Report Doc: all the base studies and reportes necessary
for value production / innovation (technical reports,
Feasibility studines, market analysis, ...) 25

26. Semantic Doc Management
• Semantic Descriptors of Docs are the missing
ring between humans and computers
• Docs give account of entities, phenomena and
manifestations that make sense for humans
(tech experts, business people, customers and
suppliers, etc.)
• We need to make such knowledge fully
available to computers ...

Let’s go semantics
26

27. Enterprise Ontologies
• Enterprise Ontologies will reflect the
knowledge originated within the Enterprise,
gathered in the Enterprise Docs
• Enterprise Doc are generally complex
structure whose semantics cannot be
captured by a single ontology
• There will be primary ontologies and
complementary ones
27

28. The DocOnto Constellation
Each ontology is used to define the structures of
corresponding docs, supporting the generation of the
related doc instances (KRO: Knowl Resources Onto)
• DocOnto – Documents and Reports Ontology
• BusOnto – Business Ontology
• DomOnto – Domain Ontologies
• ProcOnto – Process Ontology
• PerOnto – Performance Ontology
• AROnto – Actors & Roles Ontology
Besides the DocOnto, that defines the structure of the
documents, the other ontologies participate in
‘semanticise-ing’ the content, with different points of
view.
28

29. Production Doc Annotation
Buyer Info
OrderNum PERMASA Group
5796 Pedro Texeira, 8 28020 – Madrid
Date: 11-08-05 Ph. 913301003 Fax. 913301005
Email: info@permasa.es
BusOnto Tax number: G12345678
Contact: John Smith
Seller Info GREBECO – Calle Sol, 23 18003 –
Granada (Spain)
Ph. 958203734 Fax. 558282885
Email: info@grebeco.com
Product
Description Quantity ProdUnitCost(€)
AROnto
Code
ON229 Wardrobe 49*99 2 78.00
Sheft unit panel
OP328 1 59.00
60*175
OP481 Rear panel 2 20.00
OP873 Bunk bed ladder 1 21.00
Upper bed for a
DocOnto
OP874 1 65.00
DomOnto youth bedroom
Total(€)
341.00
Purchase Order
29

30. Semantic Descriptor
The ‘missing link’ between human-oriented
documents and computer-oriented knowledge
management.
Organization of a Semantic Descriptor
- Header: metadata
- Domain Specs Content
- Related K Resources: links to other SD (e.g.,
previous doc)
- External Links
30

31. Innovation Doc: Feasibility Study
Is the Innovative Idea (of, e.g., a new product) viable?
• Technical feasibility
– Design outline: structure, functions, expected
effectiveness
– Material costs, Production costs
– Enabling technology
• Business feasibility
– Potential market penetration, Production volumes
– Competitors and Market leaders
– Value proposition, business model, and SWOT, profitability
• Organizational feasibility
– Competencies and Capabilities
– Partnership and Suppliers
– Resources estimation: time and financial viability 31

32. Annotating a Feasibility Study
Tech-F
BusOnto
Bus-F
DomOnto
Org-F
AROnto
DocOnto
Feasibility Study and its sections 32

33. From Reality to Virtualy
Sem Semantic
Descriptors Annotation
RW Docs
ProData
DB
Real World
33

34. Innovation needs managed chaos
• Beyond processes ... Waves
Work
Intensity
Creativity Feasibility Prototyping Engineering T
(drawing extracted from BIVEE Deliverable D2.1)
34

35. Virtual Innovation Factory
DocOnto DomOnto
BusOnto ProcOnto
AROnto
Doc Network Final
Innov
!
Idea W1 W2 W3 W4
Innovation
Diary
Whiteboard
PerOnto 35

36. A platform for open Innovation
Social Semantic Knowledge Managemet Platform
Social – open to all (up to IPR)
Semantic – a rigorous bases for:
Knowledge – any form of enterprise knowledge:
documents, minutes, reports, videos, image, ...
Management – advanced services to allow managers
and innovators to keep under control the evolution
of the venture
Current experimentation: Semantic MediaWiki Plus
36

37. Conclusions
• The main ideas on a new approach for
Innovation have been presented
• Future innovation needs to be addressed as a
Knowledge Management venture
• But traditional KM is not suited for the purpose
• We need to revisiting the existing KM solutions
• Ontologies and Semantic Wikis are promising
tools, together with social media and
cooperation tools (in Open Innovation)
• But human intelligence and creativity remains
the key pillar
37

38. Thank you for your attention
Wake up ... Questions? 38