Fdc open services innovation creativity talk 190612final

19-6-2012

Open Services Innovation
by Marion Debruyne, Wim Vanhaverbeke and Livia Pijakova
Flanders DC Kenniscentrum

Flanders DC - Mission

Stimulating Creativity in Stimulating Entrepreneurship in
Flemish Entrepreneurs Flemish Creative Industries

2 Flanders DC Kenniscentrum

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19-6-2012

Flanders DC – Companies

3 Flanders DC Kenniscentrum

Flanders DC – Schools

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Flanders DC – General Public

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Open Services Innovation
by Marion Debruyne, Wim Vanhaverbeke and Livia Pijakova

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19-6-2012

Open Innovation in Services: 2 sides of the same coin

Upstream open innovation = with Partners

YOUR
COMPANY

Downstream open innovation = with Customers

7| Flanders DC Kenniscentrum | 19-06-2012 | Creativity Talk: Open Services Innovation

Value co-creation is the new paradigm

Commoditization risk?
More products and innovations
How to be different?

More Information, MARKET Value co-creation
more choices Forum of conversations Customers are part of value chain
More informed, network and between customers, From product-centric to personalize
companies & communities customer experiences
empowered customer

Word of mouth
Peer influence
Customers are the best or the worst
marketing tool

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


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19-6-2012

They have all done it…

9| Flanders DC Kenniscentrum | 19-06-2012 | Creativity Talk: Open Services Innovation

Upstream + Downstream possibilities:
In Focus:

Design Co-produce
With Partner

HealSeeker by J&J Cab Sense
Design with Co-
Co-produce
Partner with Partner

Co- Amro
Co-produce
Customer

Swift ABN
Design with
EUREX – with
Customer
Customer
Deutsche Boerse Customer
With

10 | Flanders DC Kenniscentrum | 19-06-2012 | Creativity Talk: Open Services Innovation

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19-6-2012

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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19-6-2012

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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19-6-2012

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

Design Co-produce
With Partner

HealSeeker by J&J CabSense
Customer

Swift ABN Amro
EUREX –
Deutsche Boerse
With


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19-6-2012

In some service industries,
co-creation with customers
is DIFFICULT.

But NOT im possible!
17 | Flanders DC Kenniscentrum
| 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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19-6-2012

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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19-6-2012

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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19-6-2012

…and Swift is NOT alone
practising Open innovation in
the financial industry…


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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19-6-2012

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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19-6-2012

Our Framework

With Partner Design Co-produce

Customer

Swift ABN Amro
EUREX –
Deutsche Boerse
With


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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19-6-2012

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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19-6-2012

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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19-6-2012

Our Framework

With Partner Design Co-produce

Customer

Swift ABN Amro
EUREX –
Deutsche Boerse
With


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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19-6-2012

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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19-6-2012

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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19-6-2012

But where exactly is the value created for
the customer?

Search and Service
Purchase
Selection Experience
Example of

Gamification/
Co-created advice: Many in one service Customisation:
OI

Amazon bundles: Raytheon & Disney
Netflix prize Brussels Loft, KLM meet & seat
NU.nl


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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19-6-2012

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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19-6-2012

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

Search and Service
Purchase
Selection Experience
Example of

Many in one service Gamification/
co-created advice:
OI

bundles: Customisation:
KLM Bluenity
YourAirportTransfer & KLM meet&seat
KLM


You CAN Combine Upstream + Downstream possibilities:
Air France KLM

Design Co-produce
With Partner

EC Solution KLM iSeatz
Customer

KLM Meet&Seat
KLM In-Touch KLM Bluenity
With

Community


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19-6-2012

KLM & EC Solution

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 YourAirportTransfer - door-to-door service

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


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19-6-2012

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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19-6-2012

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?
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?

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How can your role in the ecosystem enable you
Flanders DC Kenniscentrum | 19-06-2012 | Creativity Talk: Open Services Innovation
to capture value?

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19-6-2012

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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19-6-2012

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


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