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A draft whitepaper on how to use open collaboration techniques to drive innovation and productivity in the SME space.
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OPEN COLLABORATION FRAMEWORKS AND STRATEGIES FOR SMALL TO
MEDIUM ENTERPRISES
The Why, What and How for SME`s that are interested in Organization Innovation through the Implementation of Open
Collaboration Processes
Draft
Suresh Fernando
Partner, Radical Inclusion
Table of ContentsObjectives and Scope..................................................................................................................... 5
What is Open Collaboration?..........................................................................................................5
What is collaboration?................................................................................................................. 5
What is Openness?..................................................................................................................... 5
Why Implement an Open Collaboration Strategy?..........................................................................5
Fostering Innovation....................................................................................................................6
Increasing Productivity................................................................................................................6
Examples of Very Successful Enterprise Open Collaboration Strategies.......................................6
GoldCorp - making visible and internal problem..........................................................................6
Proctor and Gamble – developing a collaborative innovation framework....................................6
IBM: Fostering innovation and transforming corporate culture....................................................7
ThinkPlace............................................................................................................................... 7
SmallBlue................................................................................................................................ 7
Beehive.................................................................................................................................... 8
Jamming.................................................................................................................................. 8
Lego - empowering a user community to co-create products......................................................8
Intel – Developing a Collaborative Research Framework............................................................8
The Open Innovation Attitude.........................................................................................................9
Why Open Collaboration Works....................................................................................................10
Challenges to Implementing Open Collaborative Processes........................................................10
The First Thing To Realize........................................................................................................10
Effective Collaboration Will Take Time......................................................................................11
Agreeing on common goals.......................................................................................................12
Leadership and organizational Culture......................................................................................12
Sharing Information Widely.......................................................................................................12
Developing Trust....................................................................................................................... 13
Resource Scarcity.....................................................................................................................13
Information Quality.................................................................................................................... 13
Common Mistakes When Developing Open Collaboration Strategies..........................................13
Focusing on Reducing Bottom Line Rather than Increasing Top Line.......................................13
Ineffective Leveraging of Collaboration Partners.......................................................................13
Failure to Align Collaboration Strategy with Business Strategy.................................................13
Strategic Considerations for Implementing Successful Open Collaboration Strategies................14
Develop a clear leadership message........................................................................................14
Collaborate With Clients............................................................................................................14
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Develop A Culture of Trust and Openness................................................................................15
Continuously Improve Products and Services Through Iteration...............................................15
Understand That Participation in Open Communities Is A Skill.................................................15
Preparing Your Organization to Collaborate.................................................................................15
The Process for the Implementation of an Open Collaboration Strategy......................................15
Existing Communities Versus Developing Your Own Community................................................16
Advantages of Participating in Existing Community..................................................................16
Disadvantages.......................................................................................................................... 16
Open Collaboration Frameworks for Intra-Organizational (between organizations) Collaboration17
Closed Hierarchical Community:...........................................................................................18
Closed Flat Community:.........................................................................................................18
Open Hierarchical Community:..............................................................................................18
Open Flat Community:............................................................................................................18
Closed Hierarchical Community:...........................................................................................19
Closed Flat Community:................................................................................................................19
Open Hierarchical Community:..............................................................................................19
Open Flat Community:............................................................................................................19
Open Collaboration Frameworks for Inter-Organizational (inside organization) Collaboration......20
Closed Hierarchical Enterprise:.............................................................................................20
Closed Flat Enterprise:...........................................................................................................20
Open Hierarchical Enterprise:................................................................................................20
Open Flat Enterprise:..............................................................................................................20
Open Collaboration Assessment Questionnaire...........................................................................20
Developing the Right Open Collaboration Processes...................................................................24
Open Collaboration Products........................................................................................................24
Strategy Formation.................................................................................................................... 24
Open Collaboration Strategy Assessment.............................................................................24
Open Collaboration Testing...................................................................................................24
Open Collaboration Framework Development.......................................................................24
Execution.................................................................................................................................. 25
Identification and Engagement of Key Stakeholders.............................................................25
Developing Culture of Trust and Openness...........................................................................25
Virtual Team Building.............................................................................................................25
Developing Collaboration Spaces..........................................................................................25
Internal Marketing and Positioning.........................................................................................25
Virtual Facilitation.................................................................................................................. 25
Selecting the Right Tools and Platform.........................................................................................26
Developing the Right Governance Mechanisms...........................................................................26
Meritocracy................................................................................................................................ 26
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Identifying and Implementing the Right Metrics and Measurement Processes.............................27
Positioning and Branding..............................................................................................................27
Inter-Organizational Collaboration: possible strategies for SME Space........................................27
Cooperative Marketing Association...........................................................................................27
Procurement Networks..............................................................................................................27
R&D and Innovation..................................................................................................................28
Inter-Organizational Collaboration: possible strategies for large NGO’s.......................................28
Enterprise Open Collaboration Projects........................................................................................29
APPENDICES............................................................................................................................... 32
Collaboration as Co-Creation of Value......................................................................................32
Intel’s Exploratory Research Framework...................................................................................33
Inter Organizational Collaboration: possible formal Structures..................................................34
REFERENCES............................................................................................................................. 35
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Objectives and Scope
The following is designed to provide small to medium enterprises with an understanding of the rationale and associated strategy for the implementation of an open collaboration strategy within the enterprise.
The approach that will be outlined will approach the problem from the top down in that it will make the case that an effective collaboration strategy is an enterprise wide commitment that requires the active engagement of senior leadership.
The organizational commitment comprises not only the formation of specific activities and processes to support open collaboration, but also a commitment to developing a collaborative culture; a commitment to the sharing of risks, rewards and responsibilities as well as the collective formation objectives.
The aim will be to develop a sequenced approach, beginning with a series of questions, for the development of a specific strategy that includes a breakdown of specific collaboration ‘products’ that can assist organizations both in the identification and the development of the correct strategy as well as it`s effective execution.
What is Open Collaboration?
To properly understand what an open collaboration strategy is, it is necessary to provide a definition both of what we mean by both collaboration as well as openness.
What is collaboration?
There are many ways to define the notion of collaboration. We consider the following as essential:
The sharing of risks, resources, responsibilities and rewards The co-creation of content
What is Openness?
By open we mean that the collaboration strategy will reach across existing corporate boundaries. The boundaries can be either within the organization (inter organizational) or across different organizations (intra organizational).
Open collaboration, therefore, is a specific form of collaboration; one that aims to extend the range of participation by using various communications tools, thereby increasing the number of people, groups and organizations that are thinking about the problem that an organization is attempting to solve.
The essence of open collaboration strategies is well represented in Linus Torvalds famous quote: ‘Given enough eyeballs, all bugs are shallow.’1 The point being that if enough people are thinking about a problem, any problem can be solved.
Why Implement an Open Collaboration Strategy?
Larger organizations are successfully implementing open collaboration strategies. The technology infrastructure makes it possible for smaller organizations to implement the same strategies that larger organizations do and, therefore, to reap the benefits in similar ways. All that is necessary is a proper understanding of what sorts of problems can be solved and what the correct implementation strategies are.
Broadly speaking, open collaboration strategies can be of benefit to organizations in two different ways:
1 http://en.wikipedia.org/wiki/Linus_Torvalds
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Fostering Innovation
Organizations can foster innovation by using open collaboration principles to:
Develop new products and services Modify or develop internal processes
Note that Size Matters!:2 Creating a large and open infrastructure with very loose informal networks can be a strong source of innovative ideas and processes. Growing the size of the informal network/community does not result in a point of diminishing returns due to the low cost of communication and the development of new tools to support information processing.
Increasing Productivity
Reduce costs: using virtual meetings to reduce travel costs, for example Increase Frequency and Efficiency of Distributed Meetings: virtual capabilities allow
organizations that operate across boundaries to collaborate more effectively Enter Into New Markets: This can be accomplished by joint development strategies3
Capturing Value from Open Collaboration Processes4
There are three fundamental ways in which organizations can capture value for open collaboration processes:
Monetizing what is Co-created: Intellectual property that is created through the collaboration process leads to new products or processes that have a direct benefit to the organization.
Developing Associated Products or Services: In participating in open collaboration projects, organizations have visibility into the activity of other groups. This allows them to develop products and services that can support other products and services that are being developed within the community. RedHat, for example, built a business providing consulting services in support of the Linux operating system.
Indirect Benefits: Participating in open collaboration processes provides visibility for your organizations within a broader ecosystem of relationships. This serves to position the group as leaders in the community, develop brand recognition within the community etc.
Examples of Very Successful Enterprise Open Collaboration Strategies
The following are a few examples of how large enterprises utilize the principles of open collaboration.
GoldCorp 5 - Mobilizing an external community to solve an internal problem
Goldcorp is a mining company that was faced with an underperforming mine based in the Red Lake area in Ontario, Canada. The mining industry is very traditional and hence were shocked when, GoldCorp decided to open up their data on their mines via offering $575,000 in prize money to virtual prospectors.
Within short order over 1400 mathematicians, students, consultants and of course geologists from over 50 different countries had downloaded the data
2 Kang, Ki and Kang, Gina, How Do Firms Use External Knowledge for Innovation? Analyzing Effects of Different Knowledge Sourcing Methods, International Journal of Innovation Management, Vo. 13, No. 1, March, 2009, pp. 1-173 Dittrich and Duysters, Networking As a Means to Strategy Change, The Case of Open Innovation in Mobile Telephony, The Journal of Product Innovation Management, 2007; 24. pp. 510-5214 Bughin, Jacques R., Chui, Michael, Johnson, Brad, The next step in open innovation. McKinsey Quarterly, 00475394, 2008, Issue 4, p.45 Tapscott and Williams, Innovation in the Era of Mass Collaboration, Business Week, Feb. 1, 2007
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The contest winner, a collaboration between Fractal Graphics and Wall & Associates from Australia, no member of whom had ever even seen the mine, built a powerful 3-D rendition of the mine.
Subsequent drilling resulted in striking gold in four of the first five recommendations from the winners.
In 1996 the mine produced at an annual rate of 54,000 ounces/year In 2001 it was producing at an annual rate of 504,000 ounces/year
Proctor and Gamble – developing a collaborative innovation framework
Proctor and Gamble is a poster child for the effective use of open collaboration strategies to dramatically improve the effectiveness of its innovation strategy.6 P&G implemented their Connect & Develop strategy which, in essence, is a strategy to partner with other organizations to drive the organizations Research and Development process. The results have been no less than staggering.
Five years after the company's stock collapse in 2000, P&G has doubled its share price Has dramatically increased the number of partnerships, licensing agreements etc.
increasing rate of successful innovations threefold.7 Today, more than 35 percent of P&G’s new products in market have elements that
originated from outside P&G, up from about 15 percent in 2000 45 percent of the initiatives in P&G’s product development portfolio have key elements
that were discovered externally R&D productivity has increased by nearly 60 percent P&G’s innovation success rate has more than doubled, while the cost of innovation has
fallen R&D investment as a percentage of sales is down from 4.8 percent in 2000 to 3.4 percent
today Internal Branding: “Connect and Develop” and “50% Rule” – 50% of all new innovations
to come from external partners
“You don’t need to be a $70 billion most companies to do Connect & Develop. Most companies leverage other people’s ideas and assets… Small companies can get started like we did, namely with one person having the idea and the vision…”8
“P&G, for example, once known as an obsessively secretive organization, has thrown open its laboratory doors and invited outside collaborators to help develop new technologies and products, and at the same time is sharing some of its own intellectual property freely.” 9
IBM: Fostering innovation and transforming corporate culture 10
One of the main reasons IBM introduced their social media strategy was to develop a means to better connect their 380,000 employees (50% of which are mobile) and 200,000 contractors that are spread across 2000 offices in 50 countries.
Another important reason was in order to bridge generational gaps between the older, established, members of the organization that had grown up within the established culture and
6 Huston, Larry and Sakkab, Nabil, Proctor and Gamble, Reproduced with permission from "Connect and Develop: Inside Procter & Gamble's New Model for Innovation," Harvard Business Review, Vol. 84, No. 3, March 20067 Gabor, Andrea, The Promise (and perils) of Open Collaboration, Strategy and Business, August 2009, p. 38 Huston, Larry; Sakkab, Nabil, Implementing Open Innovation , Research Technology Management (Conducted Interview), 2207 Industrial Research Institute, March – April 2007, p. 19 Gabor, Andrea, The Promise (and perils) of Open Collaboration, Strategy and Business, August 2009, p. 210 Majchrzak, Cherbakov and Ives, Harnessing the Power of Crowds With Corporate Social Networking: How IBM does it, MIS Quarterly Executive, Volume 8, No.2, June 2009, University of Min
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the younger generation of employees who both had something to contribute to the formation of new culture as well as much to learn about IBM’s history.
Specifically, IBM has introduced a number of specific processes;
ThinkPlace
ThinkPlace is an open discussion forum where ideas can be submitted, modified and reviewed collaborative by anyone in the organization. It was launched in late 2005. Since that time it has attracted 160,000 users who have generated over 180,000 ideas. 350 ideas have been implemented giving rise to a financial impact of over $500 million!
SmallBlue
SmallBlue is a social networking tool that provides a graphic view of the degrees of separation between IBM employees on the basis of common interests.
Beehive
Beehive is an enterprise social networking site similar to Facebook. Employees report that they use Beehive to essentially humanize their workplace by getting to know employees on levels that are not visible from within the corporate environment.
Jamming
A unique and interesting strategy utilized by IBM is the process of Jamming which is supported by a proprietary technology developed within IBM. Effectively Jamming is a real time mass collaboration brainstorming session. In 2006, IBM held InnovationJam, an internal brainstorming session that engaged 150,000 people from 104 countries and 67 different companies.
On the basis of this, ten new IBM businesses were launched with an aggregate seed investment of $100 million
Lego - empowering a user community to co-create products 11
Lego has developed a complete social media/consumer engagement strategy that includes a number of different touchpoints; a fan club, a social network, online movies, online games, and message boards. They are also working on a massively multiplayer game.
What is most interesting is that they have opened up their software design process to roughly 120,000 designers who can design their own products. This serves the purpose of engaging closely with those that most care about the brand.
Intel – developing a Collaborative Research Framework 12
Intel, the world’s leading manufacturer of microprocessing chips, operates in a highly dynamic and technically challenging arena. In order to drive competitiveness Intel needs to be on the forefront of the discovery of new technical solutions of various sorts. The nature of the microprocessor industry makes it possible (using Moore’s Law) to identify many of the technical hurdles that the company will face in the future. Hence Intel, throughout its history, has had a very well defined roadmap driven research process.
This, however, is strategically inadequate because it fails to identify the following:
11 Egol, Moeller and Vollmer, The Promise of Private Label Media, Strategy and Business, Published: May 26, 2009 12 Tennenhouse, David, Intel’s Open Collaborative Model of Industry-University Research, Research Technology
Management, Jul/Aug2004, Vol. 47 Issue 4, p19-26
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{
1. New technologies and products that might lead to new business lines and the altering of corporate strategy.
2. Disruptive innovation that might threaten the existing product roadmap.
In order to address this strategic constraint, Intel has made a commitment to developing and driving exploratory research processes.13 The four pillars of this strategy are:
Providing collaborative research grants Developing collaborative research facilities in close proximity to universities Providing corporate venture capital Driving specific corporate research projects
13 See Appendix for further details
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The Open Innovation Attitude14
In the examples above you will consistently find a commitment to a certain way of thinking within organizations that have successfully implemented open innovation strategies. The contrast with old ways of thinking about innovation is well summarized in the following table:
Closed innovation principles
Open innovation principles
The smart people in the field work for us.
Not all the smart people in the field work for us. We need to work with smart people inside and outside the company.
To profit from R&D, we must discover it, develop it, and ship it ourselves.
External R&D can create significant value: internal R&D is needed to claim some portion of that value.
If we discover it ourselves, we will get it to the market first.
We don't have to originate the research to profit from it.
The company that gets an innovation to the market first will win.
Building a better business model is better than getting to the market first.
If we create the most and the best ideas in the industry, we will win.
If we make the best use of internal and external ideas, we will win.
We should control our IP, so that our competitors don't profit from our ideas.
We should profit from others' use of our IP, and we should buy others' IP whenever it advances our business model.
This means that within the company a shift should take place in the way people look at the company and its environment. Involving other parties when developing new products and technologies can be of great added value.
Why Open Collaboration Works
Here are some of the reasons why the implementation of open collaboration strategies within larger enterprises has proven successful.
14 Reference: Chesbrough, H. (2003), "Open Innovation: The New Imperative for Creating and Profiting from Technology", Harvard Business School Press.
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More people focusing on the problem
Most talented individuals focus on the problem
Open peer review processes create more accountability15
People are more likely to share information in open environments because there is not expectation that ideas be implemented; as opposed to work environments16
Leverage Collective Intelligence of whole organization… plus others outside organization
Empowers all members of organization: ‘mailroom to boardroom!’
Fosters innovation and creativity
Cultivate leaders within the organization
o Leadership lies with contributors, not established hierarchy
Team Participation can Scale
o More resources
o More ideas
Creates culture of openness and transparency
Creates sense of being part of much larger whole
Acknowledges diversity of employee skills – not ‘pigeonholed’
o Direct organizational benefit: access to additional knowledge
o Indirect organizational benefit: makes employees feel ‘fully valued’.
Connects organization across boundaries
o Creates dialogue that results in new clients, partners…
o Creates dialogue that results in different perspective – thought is not constrained by organizational ‘group think’
Information transfer accelerated – is viral
Distributed Collaborative Intelligence: proportional to size of group
Generates knew organizational knowledge; synthesis of cross boundary information
Challenges to Implementing Open Collaborative Processes
There are two types of challenges that you will face in implementing open collaboration processes; collaboration and culture related challenges and implementation related challenges.
Collaboration and Culture Related Challenges
The First Thing To RealizeCollaboration is tough!! Collaboration is a hot topic these days – one that is getting lots of interest. We all intuitively know that working with others should be a good thing, but the reality is that effective collaboration either within an organization or across organizational boundaries is a challenge.
15 Johnson, Justin P, Collaboration, Peer Review and Open Source Software, Information Economics & Policy, Nov2006, Vol. 18 Issue 4, p477-497, p. 47916 Johnson, Justin P, Collaboration, Peer Review and Open Source Software, Information Economics & Policy, Nov2006, Vol. 18 Issue 4, p477-497, p. 486
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Aside from the process related issues, your organization will be challenged by various interpersonal considerations; resistance to change, power struggles etc. All of these factors need to be considered as one develops a collaboration strategy.
Are you up for the challenge?
Effective Collaboration Will Take TimeEven after the decision to implement a collaboration strategy is made, the process is developed, the governance mechanisms put in place and so on, it will take time before the group is effectively collaborating.
We can understand this evolution over time, and the differences in terms of the types of collaborative activity as well as the respective goals the pertain to each stage, the following way.17,18
Activities Goals Trust
Networking Exchanging information for mutual benefit
Low Trust
Coordination Exchanging information
Modifying activities: regular meetings etc.
Goals are complementary (not in conflict)
Some Trust
Cooperation Exchanging information
Modifying activities
Sharing resources
Goals are compatible Moderate Trust
Collaboration Exchanging information
Modifying activities
Sharing resources
Co-Creating (sharing risks and rewards)
Some goals are equivalent High Trust
We note, therefore, that effective collaboration involves the development of trust amongst participants, and this takes time.
17 Prahalad and Ramaswamy, The Collaborative Continuum, Collaborative Strategies, Nov. 2001, p.318 Camarinha-Matos, Luis M.; Afsarmanesh, Hamideh; Galeano, Nathalie; Molina, Arturo, Collaborative Networked Organizations, Concepts and Practice in Manufacturing Enterprises, Computers & Industrial Engineering, Aug2009, Vol. 57 Issue 1, p46-60, p. 48
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Networking Coordinating Cooperating Collaborating
Agreeing on common goals19
Conventional wisdom suggests that if a group of individuals or organizations is going to collaborate, the basis for the collaboration needs to be the identification of common goals. Hence in attempting to collaborate, there is a sense that we should have a common goal!
In practice, however, identifying a common goal is much more difficult than it might appear to be at first. Groups or organizations enter into collaborative activity for a myriad of different reasons and bring different goals, resources, commitments, skills, etc into the process.
Hence, it is useful at the outset to enter into a process that investigates the Collaborative Aims of participants; individuals and organizations. The following is one possible framework to consider:
Leadership and organizational CultureIn many cases, open collaboration processes are democratic and the organizational structure is flat. Since the essence of open collaboration is to leverage the human capital assets within an organization, the leaders need to be open to cultivating leadership within the group. This challenges traditional notions of organizational hierarchy and responsibility. The tradeoff for a more innovative and vibrant organization that has leadership that is willing to take on this challenge is the creation of a new organizational culture where employees think differently and see their role within the organization differently.
We suggest that, in the long run, this will be of benefit to the organization.
Sharing Information WidelyBusiness leaders are taught to keep intellectual property close to the vest as it is an asset that can be monetized. Committing to openly sharing information with clients, partners and potentially even competitors is a necessary feature of open collaboration; one that requires a firm commitment from leadership and, in most cases, requires a cultural shift within the organization.
Developing TrustEssential to the functioning of any collaborative enterprise is the development of trust amongst participants. Although the ideal case is that participants enter into the collaboration with a certain
19 Huxham, Chris; Vangen, Siv. Doing Things Collaboratively, Realizing the Advantage or Succumbing to Inertia, Organizational Dynamics, May2004, Vol. 33 Issue 2, p190-201
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level of mutual trust, the reality is that in many cases participants don’t know each other and hence the starting point is a certain level of distrust. (see Developing Trust Within Virtual Teams for practical suggestions)
Implementation Challenges
Resource ScarcityAn obvious challenge that any new initiative faces (not just open collaboration processes) is the requirement to redeploy resources (people, money, infrastructure etc.) internally in order to move forward with the initiative. Hence, a strong commitment to the project will be necessary in order to garner the support required.
Incentivizing ParticipantsA key ingredient to the success of the overall strategy will be the formulation of a strategy that provides the proper incentives both to participants within your organization as well as those in outside communities that you want to get involved.
Information Quality20
Information quality is clearly an issue in cases like Wikipedia where essentially anyone can contribute to content creation. It is also a problem, from an enterprise perspective, if the collaboration generates any products or services that are associated with the brand, hence a quality control strategy needs to be implemented.
Common Mistakes When Developing Open Collaboration Strategies21
Here are some common mistakes organizations make when implementing a collaboration strategy:
Focusing Excessively on Reducing Costs Rather than Increasing Top Line
A common mistake was for firms to engage global partners for the purpose only of reducing costs. Collaboration must be understood as benefiting an organization’s top line. Not only reducing its bottom line. Successful implementations focused on both.
Ineffective Leveraging of Collaboration Partners
Two basic considerations are partners`:
Superior capabilitieso Increased capacityo Unique skills
Local knowledge
Effective strategies will account for and leverage a partner`s advantages in these areas
Failure to Align Collaboration Strategy with Business Strategy
In many cases since the collaboration strategy was viewed as merely an extension of the partnership strategy the purpose of which was merely to reduce costs, further consideration
20 Stvilia, Twidal, Smith and Gasser, Information Quality Work Organization in Wikipedia, Journal of the American Society for Information Science and Technology, 59 (6): pp. 983-1001, 200821 MacCormack, Forbath, Brooks and Kalaher, Innovation Through Global Collaboration: A New Source of Competitive Advantage, 2007, working paper, Harvard Business School
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wasn’t given to the formulation of a specific collaboration strategy that supported the organization`s mission.
As we have already stated, an effective open collaboration strategy is an enterprise wide commitment that must obviously be integrated with a firm`s larger strategic objective.
Strategic Considerations for Implementing Successful Open Collaboration Strategies22
An examination of successful open collaboration projects suggests that organizations would be wise to consider the following as they formulate their strategy.
Develop a clear leadership message
The collaboration strategy needs to be an enterprise wide initiative. As a consequence it must be the CEO’s project. Furthermore, in order to effectively communicate the message across the organization it will be necessary to craft a specific internal branding and positioning message (see P&G case study).
Collaborate With Clients
Engaging with clients provides insight into both what is right about ones correct service offering as well as precisely what sort of problems clients have that your organization might be able to help to alleviate. Collaborate with your clients in the formulation of products and services that are solutions to problems as identified by them!
22 Gabor, Andrea, The Promise (and perils) of Open Collaboration, Strategy and Business, August 2009, p.4
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Develop A Culture of Trust and Openness
As has been mentioned previously, this is of the utmost importance. If one wants to engage clients and partners the right context must be present. We believe that openness and trust go hand in hand and therefore the first step towards the modification and evolution of one’s relationships with ones clients is the creation of open environments where information flows freely.
Continuously Improve Products and Services Through Iteration
One model that is proven and that is enabled by the evolution of collaborative platforms and other infrastructures is iterative and dialogical development of a product or service. In the case of software development this is represented through the release of various versions of software that are made open for testing and feedback; alpha, beta etc. This model allows many interested parties to engage on the development of the process and also engages stakeholders in the development of the product/service.
Understand That Participation in Open Communities Requires Developing New Skills
Participation in open collaboration environments requires fostering new skills and behaviour patterns amongst employees and other stakeholders. In particular participants must become accustomed to certain features of virtual environments; immediate feedback, unfiltered feedback, the need to develop writing skills etc.;
Larger organizations develop specific training to ensure employees are prepared. IBM, for example, requires participants in new open source development communities to ‘lurk’ for a period of 30 to 60 days without active participation so as to acclimatize themselves with the dynamics of the community they are interested in joining.
Preparing Your Organization to Collaborate23
In advance of the decision to move forward with a collaboration strategy, it`s important to consider the state of affairs within your organization. Consideration needs to be given to
Governance: who, how etc.
Effective provision of staff, budget and other resources
(Provide Detail)
The Process for the Implementation of an Open Collaboration Strategy
In the following, we will present a methodology for the implementation of an open collaboration strategy within the enterprise or across a number of enterprises.
23 Romero, David; Galeano, Nathalie; Molina, Arturo, Mechanism for Assessing and Enhancing Organizations’ Readiness of Collaboration in Collaborative Networks, International Journal of Production Research, Sep2009, Vol. 47 Issue 17
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There will be a number of specific questions that need to be answered, the most basic of which are:
1. Do you want to develop a strategy that is restricted to the members of your organizations (inter-organizational collaboration) or a strategy that reaches outside your organizations boundaries
2. If it is decided that you want to extend your strategy across corporate boundaries, do you want to participate in existing networks or develop your own community with it`s own infrastructure.
Existing Communities Versus Developing Your Own Community
Advantages of Participating in Existing Community
Allows more flexibility if organization’s strategy, business models etc. might change.
Less commitment required up front. Organizations can walk away more easily.
Less financial risk since there is no cost for infrastructure development etc.
Disadvantages
Investment required at the outset to determine which communities are of strategic importance.
Less ability to direct attention towards problems of interest to your organization
No control over IP – innovation generated within community might not benefit your organization.
Reduced ability to develop brand presence
Reduced ability to develop strong relationships
The methodology we present suggests a two step approach:
1. Identify the correct Open Collaboration Framework to suit your particular objectives2. Develop the correct Open Collaboration Process upon the chosen Framework.
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Identifying Your Goals, Objectives and Priorities
Open Collaboration processes can be utilized to satisfy a range of different corporate objectives that, broadly speaking, can be reduced to the following. In order for you to determine what the correct Open Collaboration Framework is, the first step is to prioritize amongst the following possible goals. The various goals suggest a specific framework. In working through organizations goals we can determine which framework is most suited for the problems that a particular organization wants to solve.24
In order to simplify this process and in order to develop a method to easily engage clients, we have developed the following questionnaire.
Note that each priority suggests a particular framework. Hence in forcing a client to prioritize amongst their objectives, we can identify the framework that is best suited for their needs.
Open Collaboration Frameworks for Intra-Organizational (between organizations) Collaboration25
The first thing that an organization needs to do when considering the implementation of a collaborative process is to determine what the right framework is. Which framework is the correct one for a particular circumstance depends on what a particular organization`s objectives are. Different framework have different governance structures and focuses and therefore should be aligned with specific organizational objectives.
In advance of explaining how an organizations goals are linked to a particular Open Collaboration Framework, we will first describe explain the taxonomy we are using:
The primary considerations are whether the structure should be:
Open: anyone can participate, or at least the boundaries for participation are less constrained.
Closed: participation is clearly defined
Hierarchical: Leadership structure, intellectual property rights etc. are defined in advance
Flat: Leadership structure is emergent, intellectual property belongs in the public domain etc.
This leads to four possible scenarios each having unique characteristics.
For the purposes of nomenclature, we will refer to collaboration outside enterprise boundaries in terms of the formation of a community.
24 See the Radical Inclusion Open Collaboration Framework Questionnaire for a defined methodology for prioritizing organizational goals.25 Adapted from Pisano, Gary and Verganti, Robert, Which Kind of Collaboration is Right for You?, Harvard Business Review, 2008.
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Closed Hierarchical Community: Closed/Hierarchical
Lead by one organization
Problem(s) defined by organization
Participants defined
Solutions selected by (property of) leaders
Closed Flat Community: Closed/Flat
Emergent Leadership Structure
Problem(s) defined by group
Participants defined
Solution could be selected by (property of) leaders or open source
Open Hierarchical Community: Open/Hierarchical
Lead by one organization
Problem(s) defined by organization
Participants open
Solutions selected by (property of) leaders
Open Flat Community: Open/Flat
Emergent leadership structure
Problem(s) defined by group
Participants open
Solutions are ‘open source’
How do you select the most appropriate Open Collaboration Framework to use?
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Closed Hierarchical Community: Advantages
Control of participation
Control of management processes
Focus
No intellectual property issues
Easy to manage
Disadvantages
Can’t crowdsource
Need to select experts
No client engagement
Little marketing and business development potential
Closed Flat Community :
Advantages
Control of participation
Select experts
Strong leadership and participation
Foster deep cross boundary relationships
Disadvantages
No control of management processes
No crowdsourcing
Potential conflict over focus and questions
Conflict over IP issues
Little marketing and business development potential
Open Hierarchical Community: Advantages
Control over questions and problems posed to community
Supports innovation
Some control over IP
Engage clients and partners
Source ideas from outside organization
Some marketing and business development potential
Disadvantages
Can’t control input from outside organization
Evaluating different ideas from different sources
Management and process conflicts
Conflict over IP issues
Open Flat Community: Advantages
Fosters Innovation: source large number of ideas from wider community
Foster relationships outside organization
Leverage intelligence from everywhere – generate innovative ideas
Strong marketing and business development potential
Disadvantages
Can’t control input from outside organization
Too many ideas
Focusing ideas in a way relevant to your organization
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Open Collaboration Frameworks for Inter-Organizational (inside organization) Collaboration26
The principles just described apply directly to the case of inter-organizational collaboration as well. The only difference is that the focus is internal to the organization and the boundaries across which collaboration strategies are implemented are internal; departments, office, geographic regions etc.
Closed Hierarchical Enterprise: Closed/Hierarchical
Lead by one individual or small team
Problem(s) defined by individual
Participants defined
Solutions selected by (property of) leaders
Closed Flat Enterprise: Closed/Flat
Emergent Leadership Structure
Problem(s) defined by group
Participants defined
Solution could be selected by (property of) leaders or open source
Open Hierarchical Enterprise: Open/Hierarchical
Lead by one individual or small team
Problem(s) defined by individual
Participants open
Solutions selected by (property of) leaders
Open Flat Enterprise : Open/Flat
Emergent leadership structure
Problem(s) defined by group
Participants open
Solutions are ‘open source’
Open Collaboration Assessment Questionnaire
The following questions are designed to help us to understand what your organizational priorities are in determining what collaboration strategy is most appropriate for your organization.
Please assign a value between 0 and 20 for each of the following questions. Please note that the total you can assign is 120 for all questions
20: extremely important
26 Adapted from Pisano, Gary and Verganti, Robert, Which Kind of Collaboration is Right for You?, Harvard Business Review, 2008.
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15: very important
10: important
5: somewhat important
0: Not important
1. Is your focus internal to the organization or are you prepared to explore collaboration strategies outside of your organization?
Clearly if it is determined that the focus must be within the organization, then it becomes necessary to implement an inter-organizational (within the organization) strategy.
2. Do you have a clearly defined business problem that you want to solve? How important is this for your collaboration strategy?
Closed Hierarchical
3. Do you know where the knowledge to solve your business problem resides? Yes, we know exactly which people/organizations have the required information.
4. Is innovation a priority? Do you want to generate new ideas that you can use within your organization: products, services, processes etc.
Open
Flat- because in empowering others to lead you provide more opportunity for them to engage and can thus evolve relationships with them
5. How do you want to approach innovation? Is co-creation an important strategic objective?
Open Hierarchical: Need to formalize collaborative relationship if you want to drive co-
generation
6. Is client feedback important for your organization? Do you want to hear what your clients have to say? What they like, dislike, etc.
Open
Flat- because in empowering others to lead you provide more opportunity for them to engage and can thus evolve relationships with them
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7. Do you want to explore new partnership relationships with clients and others in the community? Open
8. Is marketing and business development an important element in developing your collaboration strategy? Do you want to increase the awareness of your company and its products in the community?
9. Do you want to have control over how the open collaboration process is implemented and managed?
10. Do you have lots of resources (people, funds etc.) to contribute to the management of the collaboration community and processes?
11. Do you want to have control of the intellectual property that is developed as a result of the open collaboration process?
12. Do you want to position your organization as a leader in your space?
13. Do You Want To Collaborate and Build Relationships With Specific Organizations?
14. Do you Want To Position Yourself As A Leader Amongst Your Clients and Partners
15. You Are Willing To Compensate Community Members for Intellectual Property?
16. How important is the development/implementation of a social mission to your overall strategy?
17. Have you considered forming cross-sector alliances; with academic institutions etc.?
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Developing the Right Open Collaboration Processes
The processes that we will support clients with will fall, broadly speaking, into two different categories; strategy and execution. The former describes the specific activities and processes that are necessary for identifying if an organization can benefit from an open collaboration strategy and, if so, what that that strategy should be.
Once it is determined what strategy should be employed, the next phase is to execute on the strategy itself.
Strategic ProcessThe strategic process aims to determine:
If an open collaboration strategy should be implemented Why the open collaboration strategy should be implemented How the open collaboration strategy should be implemented.
Open Collaboration Products
Once the correct Open Collaboration Framework has been developed, it will be necessary to develop the correct processes to support the implementation of the Framework.
Strategy Formation
Open Collaboration Strategy Assessment
Working through the questionnaire with the client and determining what the best Open Collaboration Framework is.
Open Collaboration Testing
This is a simple three part process to get a feel for whether a larger investment should be made in order to develop a more comprehensive open collaboration strategy.
1. Identify a problem within the organization or test a hypothesis. For example you might want to test the hypothesis ‘clients can help to develop new products’
2. Identify a sufficiently large group of people or organizations you want to solicit feedback from regarding your problem
3. Source feedback from said sources
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Identify Organizational
Goals and Objectives
Select Correct Open
Collaboration Framework
Select Correct Open
Collaboration Tools
Develop Correct Governance Mechanism
Identify Correct Community
Development Processes
Implement Correct
Community Development
Processes
Implement the Right
Measurement Metrics
Assess Collaborative
Aims of Participants
Determine if you want to develop
inter or intra organizational
strategy
4. Assess value of the feedback
Open Collaboration Framework Development
Assist clients to identify and develop all aspects of their open collaboration strategy.
Execution
Identification and Engagement of Key Stakeholders
Assist clients to identify the key stakeholders in the open collaboration process and to engage with them.
Developing Culture of Trust and Openness
Work with senior executives to formulate a strategy to foster and develop a culture of trust and openness within the organization.
Virtual Team Building
Assist clients in understanding the unique features of the virtual environment and the necessary considerations for successfully
Successful Virtual Meetings
Assist clients to identify the correct tools and processes for their meetings as well as train employees to use these tools.
Developing Collaboration Spaces
Assist clients to identify the correct tools, train employees on the utilization of tools, and support the ongoing utilization of tools if necessary.
Internal Marketing and Positioning
Assist clients to develop the key marketing messages and associated strategy to get buy in from organization
Virtual Facilitation
Virtually facilitate meetings for clients and provide training for clients on how to virtually facilitate meetings.
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Selecting the Right Tools and Platform
Tool Focus Structure Benefits Drawbacks
Blog Self Publishing
Chronological Get client stories and see community responses
Discussion Forum
Wiki Collaborative Content Generation
Hierarchical By Topic Can create content together with client
Community Platform Flexible; groups, files sharing, wiki’s etc.
Steeper learning curve, more experimentation to determine correct structure
Developing the Right Governance Mechanisms27
Meritocracy 28
The most important consideration in the development of governance mechanisms in completely open systems is that the participants in the system must be rewarded. As we have already seen, there different governance structures in open collaboration systems, and in some cases processes will be actively managed hierarchically.
Even if this is the case, consideration must be given to those that are actively participating in systems and their commitment and contribution need to be recognized and rewarded.
There are many pragmatic questions that need to be addressed. For example:
Getting Started:
Can anyone register or should participation be controlled?
Should content be moderated or is participation completely open?
Most wiki infrastructures, for example, allow one to:
Block postings
Block IP addresses
27 Stvilia, Twidal, Smith and Gasser, Information Quality Work Organization in Wikipedia, Journal of the American Society for Information Science and Technology, 59 (6): pp. 983-1001, 2008, SEE PAGE 98828 Gabor, Andrea, The Promise (and perils) of Open Collaboration, Strategy and Business, August 2009
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Version locking: preventing overwrites
Identifying and Implementing the Right Metrics and Measurement Processes
If one is using a wiki, for example, most wiki infrastructures allow you to track a range of data including:
Site usage
Contribution
Version histories
Permissions/Access Rights
Identifying popular threads
Positioning and Branding
“From Outsourcing to In-Sourcing”
Inter-Organizational Collaboration: possible strategies for SME Space
Cooperative Marketing Association
One strategy worth pursing is the strategy employed by the Swedish cooperative association Virtuelle Fabrik29, which in aggregate offers customers a much wider suite of products and services than any single SME. It is, in effect, a joint marketing strategy that, however, is well coordinated through the adoption of a singular technology platform, Webcorp, which is a requirement for participation.
Procurement Networks
Supply Network Shannon30 is, among other things, a procurement network for organizations interested in working with its member network of electronics and engineering companies in the Shannon region.
29 Flores, Boehr, Huber, Pluss, Schoch and Pouly, The Role of Universities Developing New Collaborative Environments, Analyzing the Virtuelle Fabrik, Swiss Microtech and the Tenet Group, in IFIP, International Federation for Information Processing, Volume 243, Establishing the Foundation of Collaborative Networks; eds Camarinho-Matos, Afsarmanesh, Novais, Analide (Boston: Springer), 2007, pp. 123 - 13430 Ibid
27
R&D and Innovation
Following on the heels of Proctor and Gamble`s Connect and Develop strategy. SME`s should consider collaborating on the formation of innovation strategies.
Inter-Organizational Collaboration: possible strategies for large NGO’s
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Enterprise Open Collaboration Projects
Project Description Structure Comments
Innocentive
http://innocentive.com
GlobalSight
http://globalsightl.com
GlobalSight is a collaborative, open source initiative to develop a flexible and sustainable Translation Management System (TMS) that leverages the best ideas and addresses the true needs of the industry. GlobalSight embraces an ecosystem of enterprise clients, translators, language service providers, technology suppliers, universities, research institutions and individuals alike!
Open,
Flat
Blade
http://blade.org
Blade.org is a collaborative organization and developer community focused on accelerating the development and adoption of open blade server platforms. The organization was established in February 2006 to increase the number of blade platform solutions available for customers and to accelerate the process of bringing them to market. From eight founding companies, Blade.org has grown to nearly 100 members including leading blade hardware and software providers, developers, distribution partners and end users from around the globe.
Syndicom
http://syndicom.com/
Syndicom, Inc. specializes in developing innovative collaboration environments for education, research and design in the healthcare industry. Syndicom collaboration environment is founded on a community of practice which consists of individuals who interact with each other under a set of behavioral protocols to develop, combine and share knowledge in order to achieve common goals.
Global Food Banking Network
http://www.globalfoodbanking.org
Inspired by Feeding America -- and with the support of the world's largest national food bank networks -- The Global FoodBanking Network (GFN) was established in January 2006. Our mission is to alleviate world hunger. We do this by supporting food banks
29
and food bank networks where they exist, and by working collaboratively to create them in communities where they are needed. We work in countries that make up nearly a third of the world's total undernourished population.
The Alzheimer Research Forum
http://www.alzforum.org
The Alzheimer Research Forum, founded in 1996, is the web's most dynamic scientific community dedicated to understanding Alzheimer's disease and related disorders.
Open, flat Does not seem to have an explicitly collaborative process. More of an open community
Innovation Exchange
http://www.ixc.com.au/home.html
The InnovationXchange is a leader in the practice of open innovation. The IXC Intermediary service offers a secure platform for organisations to share confidential information and ideas for tangible business and research outcomes.
CaBIG
https://cabig.nci.nih.gov/overview/
caBIG® stands for the cancer Biomedical Informatics Grid®. caBIG® is an information network enabling all constituencies in the cancer community – researchers, physicians, and patients – to share data and knowledge. The components of caBIG® are widely applicable beyond cancer as well.
NineSigma
http://www.ninesigma.com/
NineSigma is the most experienced and advanced Open Innovation service provider in the world. Founded in 2000, NineSigma has been offering open innovation solutions long before it was an accepted management practice.
P&G Connect and Develop
https://www.pgconnectdevelop.com
Do you have a game-changing product, technology, business model, method, trademark, package or design that can help deliver new products and/or services that improve the lives of the world's consumers? Do you have commercial opportunities for existing P&G products/brands? If so, we'd like to consider a partnership
Misscha
http://www.misshaus.com/pageControl.php?page=index
A Korean beauty products company that sources product ideas from its clients via (http://www.realinnovation.com/offsite.asp?A=Fr&Url=http://www.beautynet.co.kr/). It has now garnered 40% market share in it`s segment.
Mondragon The United Steelworkers (USW) and MONDRAGON
30
http://www.usw.org/media_center/releases_advisories?id=0234
Internacional, S.A. today announced a framework agreement for collaboration in establishing MONDRAGON cooperatives in the manufacturing sector within the United States and Canada. The USW and MONDRAGON will work to establish manufacturing cooperatives that adapt collective bargaining principles to the MONDRAGON worker ownership model of “one worker, one vote.”
PeugeotHeld an open competition requesting submissions for car designs
http://www.cardesignnews.com/site/home/whats_new/display/store4/item159465/
Threadless
http://www.threadless.com/
The shirt retailer Threadless sells merchandise online — and now in a physical store, in Chicago — that is designed interactively with the company's customer base
YourEncore
http://www.yourencore.com/
YourEncore is a network of retired and veteran scientists and engineers providing our clients with proven experience to help accelerate their pace of innovation. Spun out of P&G Connect and Develop
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APPENDICES
Collaboration as Co-Creation of Value
32
Intel’s Exploratory Research Framework 31
31 Tennenhouse, David, Intel’s Open Collaborative Model of Industry-University Research, Research Technology
Management, Jul/Aug2004, Vol. 47 Issue 4, p19-26
33
{
Inter Organizational Collaboration: possible formal Structures 32
32 Romero, David; Galeano, Nathalie; Molina, Arturo, Mechanism for Assessing and Enhancing Organizations’ Readiness of Collaboration in Collaborative Networks, International Journal of Production Research, Sep2009, Vol. 47 Issue 17, p. 4703
34
Hierarchical Ownership Relations
Joint Ventures
Equity Investment
Cooperatives
R&D Consortia
Franchising
Licensing
Subcontractor Networks
Industry Standard Groups
Project Groups
Increasing levels of integration between organizationsfrom bottom to top
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{