From a Good to an Excellent Product: Achieving innovation with Living Labs and User Inclusion

Transcription

1 January 2015, Sofia From a Good to an Excellent Product: Achieving innovation with Living Labs and User Inclusion Jens Schumacher SFC Fostering students' entrepreneurship and open innovation in university-industry collaboration

2 You are not in an empty Space! Neither is your Product or Service!

3 Motivation Research is making knowledge out of money - innovation is making money out of research Per Eriksson, Director for the Swedish Agency for Information Systems 85 % of product development time is invested in products which never reach the market. Reinhold Bauer: Kein Bedarf für Plastikräder. Freitag 43. Only 18 % of the innovations brought into the market prove sustainably successful. Innovation Network Austria Study Seite 3

4 Motivation Given enough eyeballs, all bugs are shallow. Linus Torvald If I can tap into a million minds simultaneously, I may run into the one that's uniquely equipped. Business week 2005 Crowds [ ] are smarter at solving many problems than even the brightest individuals. Business week 2005 Seite 4

5 Leaders feel pressure for change but also see opportunity in innovation Seite 5 IBM corporation 2005

6 Sources of New Ideas and Innovation IBM corporation 2005 Seite 6

7 Origins of the Living Lab Concept MIT, Boston, Prof William Mitchell, MediaLab and School of Architecture and City Planning. Living Labs represent a user-centric research methodology for sensing, prototyping, validating and refining complex solutions in multiple and evolving real life contexts. Origins of the Living Labs approach: - Smart/future homes - Did not cater for wide multi-contextual aspects - Various approaches to integrate citizen into value-creation process Seite 7

8 Degree of Participation Participation and Context Knowledge Focus Single and Controlled contexts Multiple and Emerging Contexts High: Observation and Creation Traditional Lab Experimentation Living Lab Experimentation Low: Observation Traditional Empirical Social Science Research Ethnographical Observation cf. Scharmer Seite 8

9 Living Lab Traditional Lab Bringing Product Development to the Customer Real life Enterprise C C C C C C C C C C C C C C C C C C C C C C Customer/Citizen

10 Definition of Living Labs A Living Lab is a collaboration of Public-Private-Civic Partnerships in which Who What What Where When stakeholders [enterprises, academia, public and civic bodies, customers] co-create [collaborative product development from ideation to market deployment] new products, services, businesses and technologies [enterprises, academia, public and civic bodies, customers] in real life environments and [regions of with specific attributes urban, suburban, rural, remote, ] virtual networks [networks as regions in a virtual geography] in multi-contextual spheres. [in all roles and phases of the customers use]

11 European Network of Living Labs A European Network of Living Labs will provide a research and innovation platform integrating diverse social, cultural, regional and international systems.

12 Benefits of Network Approach to Living Labs _Extension of contextual possibilities by: - Regional aspects - Added context: urban, suburban, rural, remote, - Added context: multi-lingual and cultural context _Higher comparability and thus value of Living Labs results. _Harnessing regional sectorial specializations. _Opportunities for customers to more easily enter new markets. _Implementation of regional contact points for Living Labs customers.

13 Community Technology Layers of Networking Living Labs Infrastructure network Interoperable testbed and network infrastructure Application network Common architecture (integrating all stakeholders) integrating tools & applications Organisational network Organisational and business structures implemented, set of common methodologies employed People network Professional network of Living Labs experts, regular workshops

14 Examples of European Living Labs Living Lab Mobile City Bregenz Testbed Botnia Mobile City Bremen Freeband Kenniswijk Cantabria Turku Archipelago Arabianranta i2cat CASST Centre Country Austria Sweden Germany Netherlands Netherlands Spain Finland Finland Spain Ireland

15 Mobile City Bregenz Testbed Botnia Mobile City Bremen Freeband Kenniswijk Cantabria CASST Centre Arabianranta Turku I2CAT Living Lab Stakeholders Living Labs Stakeholder Public and Civic Communities X X X X X X X X X X Public and Regional Authorities X X X X X X X X X X Industry SMEs Academia Investors Content Providers X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X X

16 Stakeholder Benefits - Living Labs Stakeholder Possible benefits of a Living Lab Public and Civic Communities - Early access to innovative services - Influencing the future of ICT - Voice their needs before the product is developed - Better quality of life by gaining better services and infrastructure Public and Regional Authorities - Direct investments start up s - Stimulates job growth in an innovative and creative region - Innovation Leadership - Marketing aspects publicity Industry - End-user access - Higher quality of products or services - user-oriented products or services - speed up of innovation

17 Benefits of a Living Lab for the stakeholders Stakeholder Possible benefits of a Living Lab Content Provider - content evaluation Service Provider - Evaluation of Services before market launch - Usability improvement - Ideas and/or concepts for new services - better quality of the evaluated services Infrastructure Provider -Fast deployment and uptake of Infrastructure

18 Benefits of a Living Lab for the stakeholders Stakeholder Possible benefits of a Living Lab SMEs Academia Investors -Access to the network of the Living Lab (Academia, Industry, Citizen ) -Reduce financial risks by using the open testing environment of a Living Lab - Research input - Validation of research results in the Living Lab - Partnerships/Access to the Living Lab network - Venture Capital for start-ups

19 Main focus of the Living Labs Main focus of the Living Labs Technology driven Service driven Methodology Driven

20 Financing of the Living Labs Financing of the Living Labs Public-Private-Partnership

21 Duration of the Living Labs Duration of the Living Labs Permanent Structure Project orientated

22 Products & Services Living Lab Mobile City Bregenz Testbed Botnia Products & Services mobile Broadband Infrastructure (e.g. UMTS HSDPA) supporting the development of new innovative services for the citizens Validation of the Services Need finding services together with market stakeholders, end-users and evaluation. Services for technical tests such as interoperability, conformance etc. Services relate to service platforms, access networks and terminals and include a range of technologies. Usability testing supported by a variety of methods in labs or in real-world settings. Full scale concept tests. This service supports the full concept test of a product or service including stakeholders, end-users in a realworld environment with an interactive evaluation.

23 Products & Services Living Lab Mobile City Bremen Freeband Products & Services Mobile Research Center: The MRC provides functional tests of mobile solutions in diverse hardware environments, product tests under lab and real environment conditions as much as ergonomic and usability tests. Mobile Solution Group: The MSG provides services regarding the sale and marketing of products developed within the Living Lab. The Freeband testbed provides testing, experimenting, validation, and an open playground for users, applications, middleware that support the goals regarding intelligent communication. Freeband enables support for (near) real-life validation and user experience measurement on services and/or products via sensing and logging of data from either a social context or hardware sensors, as e.g. generated by applications on mobile devices or by the underlying network.

24 Products & Services Living Lab Kenniswijk Cantabria Products & Services Creating and implementing a unique combination of Services and broadband infrastructure in order to break through the stalemate between infrastructure and services. Strengthening The Netherlands international competitive position as a site for ICT companies. Learning from the effects ICT has on spatial, social and mobility patterns and then sharing this knowledge with other municipalities (via the Stedenlink foundation (City Connections Foundation). Project office, in charge of management. Evaluation activities, covering the validation in the Living Labs from different perspectives. Dissemination and promotion Infrastructures and services, meaning here the flexible communication infrastructure e-administration and e-government specific initiatives. e-health in rural areas. e-learning and e-training in rural and remote areas. Other projects.

25 Products & Services Living Lab Arabianranta Turku Archipelago Products & Services Existing Services: WLan Hotspots Housing company homepage and emoderator User studies Future services: Multi Channel Mall (MCM) Internet Protocol TV (IPTV) IP based housing services The main services of Turku Archipelago are: Planning services Project management Interaction with users (citizen, educational institutions)

26 Products & Services Living Lab i2cat Catalonia Digital Lab Arc Labs Waterford Products & Services The services are: Capacity of managing and supporting large ITC projects access to high tech infrastructure like Internet2 Network of advanced media, grid or mobile services The centre offers: Full remote access, allowing organizations to gain direct access to distributed resources Access to all major mobile network and emerging technologies Access to a variety of service platform environments Solid evaluation of accuracy, reliability and performance of components installed and analysed User validation community Showcase for services

27 Geographical Alignment Geographical Alignment of the Living Labs Regional National International

28 technology view Living Lab - Categorisation high-tech CASST Kenniswijk i2cat Wirelessinfo Madeira Mobile City Bremen Turku Archipelago Freeband Mobile City Bregenz Arabianranta low tech Cantabria Testbed Botnia evaluation co-creation user involvement

29 Living Lab - Categorisation Multi-Stakeholder involvement high CASST Mobile City Bremen Wirelessinfo Arabianranta Freeband Kenniswijk Madeira Mobile City Bregenz Turku Archipelago Testbed Botnia low i2cat Cantabria technology service driven methodology driven driven Focus

30 User integration in existing Living Labs Methodes & Methodologies Product/Service Idea Product/Service Concept Product/Service Development Market Launch traditional methods: _Customer complaints _Interviews _Focus Groups _Empathic Design _Participatory Design _Story Telling _Customer Suggestions _Idea Generation with Lead-Users _Creativity Groups traditional methods: _Conjoint Analysis _Quality Function Deployment _Concept Tests with Lead Users traditional methods: _Workshops with Customers _Prototype Testing _Usability Tests _Engineering Contests traditional methods: _Product Testing _Test Markets _Usability Tests emethods: _Online Interviews _Online Focus Groups _Online Suggestion Box _Online Creativity Groups _Market Intelligence Service _Experience Sampling Method _Innovation portal emethods: _web-based Conjoint Analysis _User Design emethods: _Dynamic Social Network logging _Virtual Prototype Tests _User Toolkits _web-based CAD emethods: _Virtual Reality _Augmented Reality _Eyetracking _Virtual Product Tests _Virtual Test Markets _Virtual and web-based Prototype Tests

31 Product/Service Idea Product/Service Idea 100% 80% 60% 40% 20% 0% Customer Complaints Interviews Focus Groups Empathic Design Participatory Design Story Telling Customer Suggestions Idea Generation with Lead Users Creatvity Groups Market Intelligence Services Online Interviews Online Focus Groups Suggestion Box Customer Advisory Panels Online Creativity Groups Log Behaviour

32 Conjoint Analysis Quality Function Deployment Concept Tests with Lead User Web-based Conjoint Analysis User Design Ethnography Product/Service Concept Product/Service Concept 100% 80% 60% 40% 20% 0%

33 Product/Service Development Product/Service Development 100% 80% 60% 40% 20% 0% Workshops with Customers Product Testing Prototype Tests Usability Tests Engineering Contests Web-based CAD Dynamic Social Network logging User Toolkits Virtual Prototype Tests

34 Market Launch Market Launch 100% 80% 60% 40% 20% 0% Product Tests Test Markets Usability Tests Eyetracking Timemotion studies Augmented Reality

35 Summary A product/service can t stand on it s own The Triple Helix is not enough There are enough methods to deal with stakeholder integration LLs have been sucessfully deployed all over Europe The combination of the LL methodology with Incubator/Accelerator promises a better market potential

36 January 2015, Sofia From a Good to an Excellent Product: Business Canvas Model Martin Dobler SFC Fostering students' entrepreneurship and open innovation in university-industry collaboration

37 Structure of the Business Model Representation and visualization of business ideas and business models Takes in account the four key elements of a business model Who? The customer What? The offer How? The infrastructure How much? The finance Canvas = inspired by artist who goes his artwork on a canvas paint

38 9 blocks to express the business model The nine blocks describe how a company makes money By editing the 9 fields it is possible to document a business model, to describe, analyse, and understand relationships

39 9+2 blocks Next to the 9 blocks of Osterwald Living Lab Approach Cross Regionality adjusted!

40 Implementing the business model Turning a business model into a sustainable enterprise, or implementing it in an existing organization To illustrate, the Canvas with Jay Galbraith s Star Model is combined to suggest aspects of organizational design Galbraith specifies five areas: Strategy Structure Processes Rewards People The business model is placed in the middle of the star as a centre of gravity that holds the five areas together.

41 THE 9+2 BLOCKS

42 1. Customer Segments Questions to answer: For whom are we creating value? Who are our most important customers? Elaborate: Common needs of customer Common behaviors Other attributes Reasons why this segment is chosen Define type of customer segment: Mass market Niche market Segmented Diversified Multi-sided platforms (or multi-sided markets

43 2. Value Propositions What value do we deliver to the customer? Which one of our customer s problems are we helping to solve? What bundles of products and services are we offering to each Customer Segment? Define how value creation takes place (characteristics): 1. Newness 2. Performance 3. Customization 4. Getting the job done 5. Design 6. Brand/status 7. Price 8. Cost reduction 9. Risk reduction 10. Accessibility 11. Convenience/usability

44 3. Channels Questions to answer: Through which channels do our customer segments want to be reached? How are we reaching them now? How are our channels integrated? Which one works best? Which ones are most cost-efficient How are we integrating them with customer routines? Description: Actual interface with customers (communication, distribution, sales channels) Which functions are carried out in the channels?(exemplary) Raising awareness among customers about a company s products and services Helping customers evaluate a company s Value Proposition Allowing customers to purchase specific products and services Delivering a Value Proposition to customers Providing post-purchase customer support

45 Define actual channel phase:

46 4. Customer Relationships Questions to answer: What type of relationship does each of our Customer Segments expect us to establish and maintain with them? Which ones have we established? How are they integrated with the rest of our business model? How costly are they? Elaborate motivation: (exemplary) Customer acquisition Customer retention Boosting sales (upselling) Define: Type of relationship (personal, automated, etc.) Categories of relationships: Personal assistance Dedicated personal assistance Self-service Automated services Communities Co-creation

47 Questions to answer: For what value are our customers really willing to pay? For what do they currently pay? How are they currently paying? How would they prefer to pay? How much does each Revenue Stream contribute to overall revenues? Generating value streams per: Asset sale Usage fee Subscription fees Lending/Renting/Leasing Licensing Brokerage fee Advertising Type of pricing mechanism defined: Fixed pricing List price Product feature depended Customer segment depended Volume depended Dynamic pricing Negotiation Yield management Real-time-market Auctions 5. Revenue Stream

48 6. Key Ressources Questions to answer: What Key Resources do our Value Propositions require? Our Distributions Channels? Customer Relationships? Revenue streams? Define types of resources: 1. Physical 2. Intellectual 3. Human 4. Financial Getting resources by: Ownership Leasing Acquired from key partners

49 7. Key Activities Questions to answer: What Key Activities do our Value Propositions require? Our Distribution Channels? Customer Relationships? Revenue streams? Categories: 1. Production 2. Problem Solving 3. Platform/Networking

50 8. Key Partners Questions to answer: What are our Key Partners? Who are our key suppliers? Which Key Resources are we acquiring from partners? Which key Activities do partners perform? Define type of partnership: 1. Strategic alliance between non-competitors 2. Coopetition: strategic partnerships between competitors 3. Joint ventures to develop new businesses 4. Buyer-supplier relationships to assure reliable suppliers Describe motivation for partnership: (exemplary) Optimization and economy of scale Reduction of risk and uncertainty Acquisition of particular resources and activities

51 9. Cost Structure Questions to answer: What are the most important costs inherent in our business model? Which Key Resources are most expensive? Which Key Activities are most expensive? Drivers for business model: Cost driven Leanest cost structure Low price value proposition Maximum automation Extensive outsourcing Value driven Focused on value creation Premium value proposition Set characteristics: Fixed costs (salaries, rents, utilities) Variable costs Economies of scale Economies of scope

52 10. Living Lab Approach Questions to answer: How are the users/citizens involved? What participative LL Models/Methods will be used? How is the LL financed? Stakeholder Involvement All Stakeholders are involved A participative innovation approach is chosen Users/Citizens are involved in all phases of the project IPR is defined Living Lab difference: Why is LL approach suited for this project? Will the LL approach affect the product/service outcome How to sustain the LL after the project is finished

53 11. Cross Regionality Questions to answer: Are Partners from Different Regions involved? Is there a symmetric distribution of resources? Is this planned as one- cross regional LL or with two independent regional Living Labs? Define characteristics of the cross regional partnership.: Other region is used to expand the market Customization of product/service to regional specialties Co-development and deployment of cross-regional product/service Motivation for cross-regional approach: What is the Value-added for the Partners in the different regions Are the regional contexts addressed? Is the cross-regional management addressed?

54 12. Advance over SOTA In which respect are you improving over the sectorial state of the art? Technology innovation Market innovation Social innovation Institutional innovation Other Describe the characteristics of the thematic domain you are acting within: (exemplary) Too few innovations are reaching the market Too few innovations survive after marker launch The potential of people s involvement is largely ignored or discarded Market size is too tiny There are institutional barriers, local markets Language and cultural issues prevent the formation of a European single market

55 13. Sustainability and Impact Will the consortium form a permanent Living Lab? If so, how shaped? As a business/technology service provider to third parties As a high-tech, R&D laboratory As a University spin-off As a Government initiative As a single enterprise As a business association Other Will the LL be sustainable after the trial is finished? Will the successful trial impact on: The economy Society Public Administration The Academic Sector Etc. Of the Regions involved?

56 Infrastructure Offer Customer Key Partners Key Activities Value Proposition Customer Relationships Customer Segments Key Resources Channels Cost Structure Revenue Streams Living Lab Approach Profit equation LL Dimension Cross Regionality Advance over the state of the art Sustainability and Impact

57 Summary Canvas Business model well accepted and deployed LL has been deployed all over Europe The adapted Canvas Model takes into account the particularities of Living Lab innovations Innovators often lack the skill to fill out the Canvas properly LL provide the resources and knowledge needed to fill the nontechnical areas of the Canvas model The LL Canvas has been successfully demonstrated and deployed in the Alcotra Project (Interreg)

58 January 2015, Sofia Thank you for your attention! Jens Schumacher Fostering students' entrepreneurship and open innovation in university-industry collaboration