Fdc open services innovation creativity talk 190612final

19-6-2012

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Flanders DC Kenniscentrum

Open Services Innovation

by Marion Debruyne, Wim Vanhaverbeke and Livia Pijakova


Stimulating Creativity in

Flemish Entrepreneurs

Flanders DC - Mission

Stimulating Entrepreneurship in

Flemish Creative Industries

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Flanders DC – Companies

3

Flanders DC Kenniscentrum4

Flanders DC – Schools

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Flanders DC Kenniscentrum5

Flanders DC – General Public


Open Services Innovation

by Marion Debruyne, Wim Vanhaverbeke and Livia Pijakova

19-6-2012

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Flanders DC KenniscentrumFlanders DC Kenniscentrum

Open Innovation in Services: 2 sides of the same coin

| 19-06-2012 | Creativity Talk: Open Services Innovation7 |

YOUR

COMPANY

Upstream open innovation = with Partners

Downstream open innovation = with Customers


Value co-creation is the new paradigm

Value co-creationCustomers are part of value chain

From product-centric to personalize customer experiences

Value co-creationCustomers are part of value chain

From product-centric to personalize customer experiences

Word of mouth

Peer influenceCustomers are the best or the worst

marketing tool

Word of mouth

Peer influenceCustomers are the best or the worst

marketing tool

Commoditization risk?More products and innovations

How to be different?

Commoditization risk?More products and innovations

How to be different?

More Information,

more choicesMore informed, network and

empowered customer

More Information,

more choicesMore informed, network and

empowered customer

Sources: Adapted from Prahalad, C.K, Ramaswamy (2004). The future of Competition: Co-creating Valur with Customers. Harvard Business Review

MARKETForum of conversations

between customers, companies & communities

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They have all done it…



Upstream + Downstream possibilities:

In Focus:


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Design Co-produce

HealSeeker by J&J Cab Sense

Swift

EUREX –

Deutsche Boerse

ABN Amro

HealSeeker by J&J

CoCoCoCo----produce produce produce produce with with with with

CustomerCustomerCustomerCustomer

CoCoCoCo----produce produce produce produce withwithwithwith PartnerPartnerPartnerPartner

Design with Design with Design with Design with CuCuCuCustomerstomerstomerstomer

Design with Design with Design with Design with PartnerPartnerPartnerPartner

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Design Co-produce

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Design with partner:

Janssen Pharmaceutica: Healseeker

� Project started in early 2011 as a

result of an internal innovation

bootcamp

� Sparked by the desire to provide

holistic treatment to children with

ADHD

� Janssen teamed up with a

psychiatric clinic Yulius, a computer

game developer RANJ and a patient

organisation ZITSTIL

� Innovative approach to behavioural

therapy – computer game to train

children in time management and

planning as a complement to

pharmacotherapy




Heal Seeker: Value Creation

� Game is to be used as a

complementary therapy

recommended by physicians

� Children with ADHD are undergoing

behavioural therapy sooner and in a

playful way

� Plans to internationalise once

successful in the Dutch-speaking

market


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Healseeker: Value Delivery

� Endorsed by ZITSTIL in Belgium

� Multi-channel approach in

distribution: online and through

ZITSTIL

� 2-pronged strategy in launching –

running clinical trials to prove game

efficacy, but also launching it

without claims




Healseeker: Value Capture

� Product is still in the pre-launch

phase

� Pre-clinical research shows possible

efficacy in achieving the learning

goals

� The initiative opened up new doors

to the gaming market for Janssen –

games geared towards other

therapeutic areas may follow

� So far the investment was done by

Janssen alone, for future RANJ may

share some of it and become a

partner


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What can we learn from Janssen?

� Partnerships for Open Innovation

spark up by serendipity: be open to

new contact and maintain your

network

� If you are in a sector, which is

regulated, involve the legal

department from day 1

� Do not be afraid to step out of your

comfort zone to innovate – trust

your partners




Our Framework


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Design Co-produce

HealSeeker by J&J CabSense

Swift

EUREX –

Deutsche Boerse

ABN Amro

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In some service industries,

co-creation with customers

is DIFFICULT.

But NOT impossible!

17 || 19-06-2012 | Creativity Talk: Open Services Innovation


Design with customer:

Swift: Innotribe

� Global cooperative ensuring secure

messaging and transactions within

and between supply chains mainly

in the financial industry

� Innotribe started on 2009 as an

internal company tool

� 2 main functions: change the

company culture and change the

company positioning to the outside

world

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Innotribe: Value Creation

� Innotribe gives bright minds from

within and outside the company an

opportunity to realise their business

ideas

� A new channel of meaningful

communication within the company

but also opens the company up to

outside world

� Swift is connected to 8000 banking

institutions

� The unique position enables them to

create an innovation hub



Innotribe: Value Delivery

� The virtual Innotribe is

seamlessly connected to

physical conferences Sibos

� Sibos conferences are

organised to recruit smart

thinkers and get them to

present their ideas in a

“Dragon’s Den” setting.

� Participants have 5 minutes to

present their idea without

powerpoint

� The prize is 50 000 EUR or

Swift’s involvement in

developing the idea

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Innotribe: Value Capture

� Swift managed to change its

corporate culture and

reposition itself as an

innovative company

� As a result of the success, in

2011, Swift set up an

incubation framework of 5

Million EUR to be able to

support more than just a

single winning idea

� About 10% of NPD idea inflow

comes from Innotribe –

currently there are 2 projects

about to be launched as a

venture



What can we learn from Innotribe?

� It may take time for an open

innovation initiative to settle

in in your organisation, but do

not give up!

� Make a clever combination of

online and offline to keep the

ball rolling between events.

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…and Swift is NOT alone

practising Open innovation in

the financial industry…

23 || 19-06-2012 | Creativity Talk: Open Services Innovation



Eurex: Idea Board

� Operating in the business of selling

derivatives in the financial market

� The initial starting point to

strengthen the innovation capability

of the company and use every

opportunity to communicate with

their customers

� Started in 2010, reaching about 350

members by 2011

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Idea Board: Value Creation

� Financial institutions are able to

express their ideas on new financial

products to a neutral and safe party

� 10% of the creative inflow in Eurex’s

NPD process comes from the idea

community

� There are ideas that sparked up

within the community in the NPD

pipeline about to be launched



Idea Board: Value Delivery

� Any one of the members can post an

idea to a virtual idea box. This one is

considered by the experts at Eurex

and evaluated.

� Some ideas may be further

developed on a forum, which his part

of the Idea Board. Then the whole

community can contribute to the

development. (only if IP is not

sensitive)

� No reward is offered, companies

benefit from the financial products

created in this collaboration.

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Idea Board: Value Capture

� The project is strengthening the

bond between Eurex and its

customers, but also fostering

innovation within the company by

opening up the company culture.

� The Idea Board community would

never have come together in face-

to-face!



What can we learn from Eurex!

� Your customers can become your

partners in development

� Give them room to co-create and

they will do so out of their own

goodwill

� Practice soft launch, start with your

best customers they will then pull

others in

� If you cannot organise co-creation

face-to-face a secured virtual

environment will do the job

� Maintain the feedback loop

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Our Framework


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ABN AmroSwift

EUREX –

Deutsche Boerse


Co-produce with partner:

Sense Networks - Cab Sense

� All taxis in New York are equipped

with a GPS device connected to a

register

� The analytical capabilities of Sense

Networks combined with NYC Taxi

&Limousine Commission give

opportunity to provide a new

service

� App launched in 2008 for iPhone,

Android and Motorola

� Predictions of most probable taxi

locations are projected onto the

map of the city as a heatmap


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Cab Sense: Value Creation

� The purpose of the app is to

improve the service experience of

travelling by taxi beyond the service

process

� It helps match taxi providers and

taxi seekers in a more efficient way




Cab Sense: Value Delivery

� App is free of charge and

downloadable from iTunes, Android

Motorola markets

� Upon installing app, users can make

use of many functions: navigation to

the point with most available taxis,

time slide to plan your night etc…

� New taxi data are fed into the

system to make the prediction

algorithm more accurate


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Cab Sense: Value Capture

� Sense Networks uses Cab Sense to

showcase the power of their

machine learning algorithm – their

main product

� Increase in revenue and passenger

satisfaction for NYC Taxi &

Limousine Commission

� Greater satisfaction and service

efficiency for the taxi hailers.




What can we learn from Sense Networks?

� If you own a good technology, look

outside its current application

� Look for partners in the new market

that have access to the target group

� Use the app market to showcase

what your technology can do to fuel

your revenue growth


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Our Framework


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ABN AmroSwift

EUREX –

Deutsche Boerse


Co-produce with customer:

ABN Amro: Arena

� Arena has been set up by the

Dialogues House – one of ABN

Amro’s ventures to facilitate intra-

company conversation and to help

people share ideas and jobs.

� The company believes that radical

ideas come from connecting people

with similar interests

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Arena: Value Creation

� People with different interests

create value for each-other and the

company

� The idea was to foster the company

culture and facilitate creative

thinking



Arena: Value Delivery

� Arena serves as a micro-jobbing

market with open positions

� Amount of hours per week is

standardised across all tasks so they

are equal

� Employees are allowed to give up a

task they dislike as long as they take

on another one they like

� The original task owner is still

responsible for the result

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ABN Amro: Value Capture

� Boost in internal communication

and alignment

� Performance boost – workforce is

happier and more productive

� Lower employee turnover

� Leaner Structure



What can we learn from ABN Amro?

� Open innovation does not need to

happen solely in the R&D field

� Partners for Innovation don’t

necessarily need to be outside the

boundaries of your company

� Collaboration is easy and successful

as long as there is a common goal

equally attractive to all parties

involved

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But where exactly is the value created for

the customer?


Search and Selection

PurchaseService

Experience

Exa

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Co-created advice:

Amazon

Netflix prize

Many in one service

bundles:

Brussels Loft,

NU.nl

Gamification/

Customisation:

Raytheon & Disney

KLM meet & seat


Co-created advice:

Netflix


� 400 000 participants

competing and collaborating

to design the best

recommendation system in

the movie rental industry

� Netflix knew it probably

wouldn’t win on price with

the likes of Walmart, so it

competed smart

� Walmart, Blockbuster and

others competed at the

purchase point

� Netflix chose a different

strategy and created a value

beyond the service result

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Many in one service bundles:

The Brussels Loft

� Focus on independents and

entrepreneurs

� You rent a desk, but you get

much more

� Exposure to fellow

independent experts

� Networking, mutual service

exchange and collaboration

on projects



Gamification/Customisation:

Raytheon & Disney

� Set up by Raytheon as part of a

wider strategic MathMovesU

programme in 2009

� Goal is to secure future

employee base by promoting

engineering education amongst

younger generation

� Partner up with Walt Disney

Imagineering to let children

design their own roller coaster

ride

� Combination of Fun & Maths

Education


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You don’t need to focus on just one stage!


Search and Selection

PurchaseService

Experience

Exa

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I co-created advice:

KLM Bluenity

Many in one service

bundles:

YourAirportTransfer &

KLM

Gamification/

Customisation:

KLM meet&seat


You CAN Combine Upstream + Downstream possibilities:

Air France KLM


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Design Co-produce

KLM In-Touch

Community

KLM iSeatzEC Solution

KLM Meet&Seat

KLM Bluenity

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� Working together in thinking out the

future of air travel

� Permanent baggage tags with

interactive display and smart

frequent flier cards with

comprehensive travel information

used as travel documents too

� Easy check in and check out, no

airport hassle for the passengers

� Significant process efficiency

improvement and decrease in

investment costs for drop off

machines for KLM!

� Less disposable material used every

day!


KLM & EC Solution


� KLM’s partner to provide a 1-stop

shop for organising the entire travel

� Saves the customer time by

providing seamless transport from

door-to-door

� makes the whole journey more

comfortable by reducing uncertainty

as taxis are informed of any delays

and accommodate for that


KLM YourAirportTransfer - door-to-door service

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KLM In Touch community

� Started in 2008 as a virtual club of

frequent fliers

� Currently around 550 members

from all over the world interact in

English

� KLM uses the input from this

community for qualitative market

research and new product

development

� Members feel special and feel that

KLM cares, so they stay loyal

� The whole organisation is more

consumer-centric


Co-produce with Customer:

KLM Meet & Seat

� Launched in February 2012 first on flights

from Amsterdam to San Francisco, Sao

Paolo and NYC

� Matching passengers sitting next to one

another through their social network

profile

� Upon booking, passengers opt in to share

details of their Facebook or Linked-in

profile and they will get to see profiles of

other passengers travelling in return

� Result: More fun and meaningful

networking on board!

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Co-produce with Customer:

KLM Bluenity

� First community site for frequent fliers

launched in 2005

� Fellow travellers share tips on hotels,

restaurants and shopping in and around

destination cities

� This makes it easier to book the right

hotels and places for business meetings

for newbies

� Passengers can make their trip plans

public on the community so fellow

passengers at the same destination can

join them


What can you do and where do you fit in?


Look at your customer’s decision-making journey

- Where does your customer seek value?

- Where is value being created for the customer now?

Look at your customer’s decision-making journey

- Where does your customer seek value?

- Where is value being created for the customer now?

Examine the value chain of your company

-Where is value created?

-What are other opportunities?

Examine the value chain of your company

-Where is value created?

-What are other opportunities?

What ecosystem do you need to build?

-Which partners will enable you to co-create the value?

How can your role in the ecosystem enable you to capture value?

What ecosystem do you need to build?

-Which partners will enable you to co-create the value?

How can your role in the ecosystem enable you to capture value?

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Thank you for listening

Questions time!



Sources 1/3

� 99Designs, company information, http://bit.ly/MHdk6e

� Abimo, Survivalgids, Interview with Sarah Kumar, 2012

� ABN Amro, Arena, In-depth Interviewm, 2011

� Air France, Bluenity, http://bit.ly/JJu3CJ

� Alam, I., 2002, An Exploratory Investigation of User Involvement in New Service Development, Journal of the Academy of Marketing Science , Vol. 30, No. 3

� Anthony, M., 2012, KLM Meet and Seat – social seating for airlines, StratChat, http://bit.ly/Kqn9ar

� ArtistShare, company information, http://bit.ly/GTbT0g

� Bernoff, J., Schalder, T., 2010, Empowered, Unleash your employees, Energise your customers, Transform your business, Harvard Business Review Press

� Brussels Loft, Interview with Bernard Perelsztejn, 2012

� Brustein, J., 2012, The Push to Make Cab Rides Smarter, New York Times, http://nyti.ms/M5CKLB

� Coyote, Conmpany Information, http://bit.ly/dGupxM

� Deuze, M., 2007, Convergence Culture in Creative Industries, International Journal of Cultural Studies, 10:243

� Edvardsson, B., et al, (2010) Involving Customers in new service development, Imperial College Press

� Gallaugher, 2008, Netflix, Cinematch Contest Case Study, http://bit.ly/JZfeLa

� Gustafsson, A., et al, 1999, Customer Focused service development in practice: a case study at Scandinavian Airlines System, International Journal of Service Management Industry, Vol.10, 4


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Sources 2/3

� Honebein, P., E., Cammarano, R., F.,2005, Creating Do-It-Yourself Customers, Thomson

� Janssen Pharmaceutica, Interview with Annik Willems, 2012

� Johnson, C., 2009, Disney's 'Sum of All Thrills' Ride Lets Kids Use Math Skills , Switched.com, http://aol.it/MT7LZ

� Kaulio, M., A.,1998, Customer Consumer and user involvement in product development: A framework and a review of selected methods, Total Quality Management, Vol.9, No 1

� Kiva, company information, http://bit.ly/ZS3o

� KLM, Interview with Charles Hageman, 2011

� KLM, Interview with Ignaas Caryn, 2012

� Kuusisto, A., Riepula, M., 2008, Customer Interaction in Service Innovation: Seldom Intensive but often decisive, International CINet Conference Proceedings, Valencia, Spain, 5-9 Sept 2008

� Lets Vlaanderen, company information, http://bit.ly/sVNKVV

� Miller, C., C., 2009, Designing a Ride and Learning Math at Epcot, New York Times Blog, http://nyti.ms/3slbMX

� OhMy News, Company Information, http://bit.ly/dzYDV9

� Prahalad, C.K, Ramaswamy (2004). The future of Competition: Co-creating Valur with Customers. Harvard Business Review

� Prandelli, E., et al, (2008), Collaboration with customers to innovate: Conceiving and marketing products in the networking age, Edward Elgar Publishing

� Reporter.co.za., company information, http://bit.ly/GALnvp



Sources 2/3

� Rhodes, M., 2008, Social media diary 07/11/2008 – Air France-KLM, Fresh Networks, http://bit.ly/8IEJknvard

� Rubin, J., 2066, Jet Blue Story booth, Coolhunters.com, http://bit.ly/GTLX8S

� Sawhney, M., et al, 2004, Creating Growth with Services, MIT Sloan Management Review, Winter 2004, Vol. 45, No. 2

� Sellaband, company information, http://bit.ly/jdU6sM

� Sense Networks, Cab Sense, http://bit.ly/L2XLXH

� Shalal-Esa, A., 2009, Raytheon, Disney collaborate on math ride, Reuters, Wed Oct 14, 2009

� Smith, T., 2009, New Interactive Simulated Thrill ride opens up at Epcot in Disney World, http://bit.ly/12i3PK

� Swift, Interview with Konstantin Peric, 2011

� Task Rabbit, Company Information, http://bit.ly/zYIl6u

� Thomke, S., 2003, R&D Comes To Services: Bank of America’s Pathbreaking Experiments, Harvard Business Review, April 2003

� Tripadvisor, company information, http://bit.ly/aP43ID

� UZ Gent, Survivalgids, Interview with Philippe Gevaert, 2012

� Van Looy, B., et al, 1998, Services Management, And Integrated approach, Second Edition, Prentice Hall

� Wikipedia, company information, http://bit.ly/Imnh

� Zopa, company information, http://bit.ly/GUPDGw, http://bit.ly/HdbOCO
