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Well are you going all digital on me?

So there we all were, getting very comfortable in our open innovation activities, learning to collaborate and co-create outside our organizations. We had worked through some of the cultural stuff; we had established the process, practice and tools. We even had our legal teams on board, helping sort out all the conflicting positions open can mean when it comes to dividing up the IP spoils and even had our leadership tuned in, singing our praises and even (heavens forbid) getting engaged in the process.

When the world shifts, we all need too.

Then suddenly the world shifts on its axis once again, everything seems to be digital. The buzz is big data, analytics, smart mobility, and social media, with lots of talk of interconnected devices giving us the next big paradigm in innovation growth.

So will my innovation portals, my collaboration platforms, my idea capture tools or my crowdsourcing and patent scanning techniques all get thrown up into the air, or are they going to be squeezed into this new digital pot?

Many are struggling with the sudden talk of big data; all of it flowing into the organization, when many of us were simply struggling with what we thought was big enough data.

What and where is this digital actually going and what does it mean to us?

How fast will the digital revolution come in my organization? Are any of us ready for this latest onslaught? Do we have the new skills all of these digital technologies require?  Does this mean I have to talk again to the IT department?

So many questions are bubbling up on digital technology; it is going to be hitting us like a tsunami, at a potentially destructive force. There is a time to find the high ground and I’d start now.

We will be faced with two choices as my ‘open’ thinking here

We will either go from open innovation to open digital innovation or we will revert back to closing up and trying to manage all this data within a closed system or network. So is this another moment for open vs closed debate, just with digital included to make it 'open digital innovation' or, is it closed digital innovation?

Will there be a difference? I think so.

First we will need to debate the ‘network effect’. Metcalfe’s Law that the value of the network is in proportion to the number of members squared. In other words the evaluation of how strong a network is, will be determined by the numbers connected. As we use technologies and leverage the internet the greater our intelligence will flourish. So open digital or closed digital?

Exploiting the ‘digital effects’ will be determined by the value it can generate. The more open the data infrastructure is, the more the networks and open hardware can collect, generate information, extract actionable value and increased awareness. So open digital or closed digital?

The excitement that digital is expected to generate in delivering the insights of anticipated solutions and pointing ‘us’ to solving existing problems, the greater its value will become. Still is this open digital or closed?

The more ‘everyone’ connects on the internet through the Internet of Things (IoT) then we will be experiencing even more of a big transformation. They forecast 5 billion additional people will connect to the internet globally in the next ten years. Today we talk of ‘high-speed’ I think we will be talking of either ‘the day the internet broke’ or ‘managing in open innovation ecosystems’ to ‘deliver the speed’.

So which way will we go? Open digital innovation or closed digital innovation?

Either into the creation and consolidation of monopolies of knowledge (closed digital innovation) or open ecosystems to foster grassroots ideas, social innovation to resolve growing problems, entrepreneurship or giving the nimble and savvy business organizations the chance to pull even more ahead in exploiting.

Each is going to demand a massive mobilization of resources, internally and externally. The digital world is more enmeshed in our lives; we are living in more ‘real-time’ than ever before that continues to form a universal distributed intelligence. We are all going to keep learning new skills and tools for understanding all this ‘collective intelligence’ coming at us.

The battle for control of the power of digital

Are we going to have a battle of competition based on open standards so as to benefit from interoperability between this data streaming in, the multiple devices we have, and growing services and networks that we require to manage it all?

Or will we see some attempting for lock-in engagements, striving for anti-competitive dynamics to steal competitive advantage and undermine swaths of ‘not able to compete’ or ‘far too slow to see it coming’?

Will we see platforms that we can all sign up and join in that link all the value chain providers, each seeking their part of the value chain that will allow for replicable, scalable and sustainable solutions or shall we stay narrow in scope and ambition? Can we afford too, if the world is connected outside our window, we continue to struggle looking out?

Whatever, digital feeding innovation will reign supreme in the forthcoming years

So with all the current trends in digital technology promising to give us embedded intelligence in our devices, social activity, plenty of social and business platforms to join in and lots of mobility to keep us on the move, we are heading off into a new world where digital will (initially) reign supreme.

All this data streaming in, either open or (selectively) closed seems to be promising a wave of new innovation opportunities. We have to decide which digital technologies are good for us and, are we throwing open the innovation digital doors or simply limiting it down?

Presently we are seeing the race to build platforms - but are they open or closed?

Closed innovation allows for a clear network of like-minded and determined organizations to work on their purpose built platform to specifically deliver value propositions.

GE has been developing their proposition around the Industrial Internet where sensors within all their products (trains, aircraft engines, wind towers, MRT scanners etc), and these sensors will provide back the data that can analyse performance, so the customer can determine scheduling of maintenance, improve planning and logistics etc.

They make the value proposition of offering a return of 1% as their stated claim, and already have a one billion dollar business since scheduling maintenance is a significant economic undertaking of downtime, resource planning and scheduling. That is a closed innovation platform as it serves GE customers, and this is being sold as a value added service. Already they are looking to open up the platform for others but not in competition to GE, so others can utilizes the resources and expertise being built up for GE to build their ‘closed’ system of innovation.

So open digital innovation or closed?  I’ll give you my bet in the next post on what will win.

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Paul Hobcraft

Paul Hobcraft

Paul Hobcraft researches and works across innovation, looking to develop novel innovation solutions and frameworks where appropriate. He provides possible answers to many issues associated with innov
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