1. Utilizing Open Collaboration Principles to Drive Innovation and Increase Productivity The What, Why and How for SME’s interested in Open Collaboration Suresh Fernando Partner, Radical Inclusion Dec. 4, 2009 suresh@radical-inclusion.com

4. You want to save money

5. You want deeper client and partners relationships

6. You want to be ‘more connected’

7. You want to be more intelligent: more knowledge, better information processing

8. You want to innovate

10. What is Open Collaboration? What is collaboration? The sharing of risks, resources, responsibilities and rewards The co-creation of content What is Openness? the collaboration strategy will reach across existing corporate boundaries. within the organization (inter organizational) across different organizations (intra organizational).

11. Why Implement an Open Collaboration Strategy? Fostering Innovation Solving defined organizational problems Develop new products and services Modify or develop internal processes 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 strategies, for example

12. Management/ Admin. Sales Accounting Inventory Open Collaboration Inside the Enterprise: across functional groups Eliminate silos Introduce platform to connect business units Operations

13. Open CollaborationOutside Organizational Boundaries Enterprise Ecosystem Client Client Client Services Layer Organization Partner Partner Service Delivery Layer Support: Financing, Volunteers Support Layer

14. Successful Open Collaboration Strategies Larger Organizations

15. Which of the following models might work for your organization?

16. Strategies You Can Implement With Open Collaboration Solve an internal problem by crowdsourcing Generate new product and service ideas by creating an innovation community Transform corporate culture by connecting your organization Co-creating products and services with your clients Developing collaborative research with clients and partners Forming a collaborative marketing association Forming a collaborative procurement network

17. GoldCorpMobilizing 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 They 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 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

18. Proctor & GambleDeveloping a Collaborative Innovation Framework P&G implemented their Connect & Develop 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. 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

19. IBMFostering Innovation and Transforming Corporate Culture IBM developed social media strategy to connect their 380,000 employees (50% of which are mobile) and 200,000 contractors that are spread across 2000 offices in 50 countries. ThinkPlaceis an open discussion forum where ideas can be submitted, modified and reviewed collaborative by anyone in the organization 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 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.

20. LegoEmpowering a User Community to Co-Create Products 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.

21. IntelDeveloping a Collaborative Research Framework Traditional, roadmap driven research processes have been found to be strategically inadequate because: New technologies and products that might lead to new business lines and the altering of corporate strategy. 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. 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 See Appendix for further details

22. The Open Innovation AttitudeHow successful collaborators think Reference: Chesbrough, H. (2003), "Open Innovation: The New Imperative for Creating and Profiting from Technology", Harvard Business School Press.

23. The Open Innovation Attitude How successful collaborators think Reference: Chesbrough, H. (2003), "Open Innovation: The New Imperative for Creating and Profiting from Technology", Harvard Business School Press.

24. What is the relationship between open collaboration and innovationyou ask?Scalable Team Thinking No geographic or time constraints A problem we all want to solve!

25. What is the relationship between communications and collective intelligence?Scalable Information Development No geographic or time constraints An information repository We build together!

27. Empowers all members of organization: ‘mailroom to boardroom!’

28. Fosters innovation and creativity

29. Cultivate leaders within the organization

30. Leadership lies with contributors, not established hierarchy

31. Team Participation can Scale

32. More resources

33. More ideas

34. Creates culture of openness and transparency

36. Indirect organizational benefit: makes employees feel ‘fully valued’.Connects organization across boundaries Creates dialogue that results in new clients, partners… 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

37. Three Basic Ways To Capture Value from Open Collaboration Monetizing what is Co-created Developing Associated Products or Services: RedHat, for example, built a business providing consulting services in support of the Linux operating system. Indirect Benefits Position your organization as leaders in the community, develop brand recognition within the community etc.

38. Challenges To Implementing Open Collaboration Strategies Effective collaboration will take time Agreeing on common goals is difficult Leadership needs to think differently Organizational culture needs to be changed Developing trust is difficult Resources for new projects are scarce Providing correct incentives to stakeholders

39. Fortunately we will help you to address these challenges!

40. From Networking To CollaborationUnderstanding the Evolution Prahalad and Ramaswamy, The Collaborative Continuum, Collaborative Strategies, Nov. 2001, p.3

41. From Networking To CollaborationUnderstanding the Differences Prahalad and Ramaswamy, The Collaborative Continuum, Collaborative Strategies, Nov. 2001, p.3 Camarinha-Matos, Luis M.; Afsarmanesh, Hamideh; Galeano, Nathalie; Molina, Arturo, Collaborative

42. What Mistakes Should You Avoid? Focusing excessively on reducing costs as opposed to increasing revenues. Ineffective leveraging of collaboration partners Superior capabilities Local knowledge Failure to align collaboration and business strategy

43. What are the Key Strategic Considerations? Ensure that the strategy is an organizational one Connect Your Collaboration Strategy to your Business Strategy Develop a clear leadership message Develop a culture of trust and openness Be willing to challenge existing organizational assumptions

44. Identifying Your Goals, Objectives and Priorities Radical Inclusion has designed a questionnaire that will assist you to determine your organizational goals and what the best way to structure your open collaboration process is.

45. Open Collaboration FrameworksStructural Possibilities Adapted from Pisano, Gary and Verganti, Robert, Which Kind of Collaboration is Right for You?, Harvard Business Review, 2008.

46. Open Collaboration FrameworksIntra-Organizational Adapted from Pisano, Gary and Verganti, Robert, Which Kind of Collaboration is Right for You?, Harvard Business Review, 2008.

47. Advantages/Disadvantages of Particular Frameworks Adapted from Pisano, Gary and Verganti, Robert, Which Kind of Collaboration is Right for You?, Harvard Business Review, 2008.

48. Advantages/Disadvantages of Particular Frameworks

49. Selecting the Correct Framework Depends on Organizational Goals and Priorities See the Radical Inclusion Organizational Assessment Questionnaire for a systematic method of assessment that maps from organizational goals to the correct framework

50. Open Collaboration Strategic ProcessesFrom goals to implementation

51. Collaboration ModulesStrategy and Implementation We expect that the overall process of engaging with enterprise clients to assess their existing strategy and to formulate and implement new strategy that will utilize open collaboration principles to drive innovation will be a modular process. The delivery will be in the form of specific modules that address the needs of a strategic initiative.

52. Open Collaboration Strategic ModulesFiguring Out What To Do... Open Collaboration Strategy Assessment Open Collaboration Testing Selecting the Correct Collaboration Framework Assessing Collaboration Aims Developing the right Governance Mechanism Selecting the Correct Tools Formulating the Collaborative Community Development Strategy

53. Open Collaboration Implementation ModulesDoing It Identification and Engagement of Key Stakeholders Developing Culture of Trust and Openness How To Build Virtual Teams Running Successful Virtual Meetings Developing Collaboration Spaces How To Market Your Strategy Internally