The impact of digital innovation changes the innovation paradigm significantly.

Organizations can stay digitally closed in their innovation activities, moving beyond simply developing innovation solutions themselves into a connected (closed) network, where the platform becomes the enabling force and those that join share common ground or purpose but are pursuing separate value propositions that required this ‘extended’ collaboration to achieve this position.

These ‘closed systems’ can give a level of competitive advantage but these are increasingly transitory depending on the complexity and uniqueness of the eventual value proposition. Collaborative platforms are clearly the way to go to open-up innovation that allows more radical and complex solutions to be provided.

We will see a new wave of open digital innovation So why do I say that? There are four aspects where technology will trend towards open (see more on that here: http://digitalsocial.eu/) to exploit our connected world. We will be looking to extract an ever-diminishing competitive advantage as the world just keeps speeding up, pushing us as technology continues to run ahead of our capacities to assimilate it.

So we need to keep moving towards open and complex solutions that require us to become increasingly collaborative to let (many) others help us on the way as partners so as to exploit the competitive advantage that is increasingly transitory.

1. Firstly, open networks – those innovative combinations of networks, which continue to evolve new solutions and infrastructures and are very rich in bottom-up potential. These open networks are extremely dynamic and diverse, full of experimental pioneers and as they work at the edges, the rest of us need to stay connected, as these open networks will continue to suppliant what we have on a constant, evolving basis.

2. Open data – This explosion of new types of data analytics and machine learning means we all will eventually have access to analyse vast amounts of data. As we innovate ways to capture, use, analyse and interpret open data coming from multiple sources we need to find its value for what we do. Open data policies will emerge from government, local authorities and (eventually) within our business organisations. We will need the tools and skills to interpret all the open data coming into us from people, our networks and simply from the environment and world we belong to.

3. Open knowledge – We are in need of co-production of new knowledge. We need to learn more about adaptive capacity where you acquire, assimilate, transform and exploit knowledge from its potential to a realized value. There is a greater trend to mobilization based on open content, open-source and open access so we can understand, absorb and make comments (or not). Knowledge must be allowed to flow openly to allow us to grow individually. We will see an increasing mass-scale of social collaborations. We are all moving to blogs, wikis, social networking and hundreds of collaborative platforms of choice. These are beginning to manage (even take over) our lives. As we disseminate the knowledge we get growing cross-fertilization.

4. Finally, Open hardware – The more we become curious, the more we want to build ‘something.’ More and more open-source hardware is permitting us to build upon it. We are increasingly having the potential to study, modify, make, extend, distribute or design so these modifications take on our identity. The use of ready to use components and materials, tapping into established processes, open infrastructures, allowing unrestricted content and plugging into open-source design tools gives us all as individuals the ability to create something. The more we are moving towards a more open-source internet of things to design, use and value within our lives.

All of this digital technology is seemingly all about getting to know. Our privacy and security concerns are getting caught up in this, for a time it will slow the pace down but I fear the ‘genie is out of the lamp’ constantly asking you your next connected wish before you see another useful technology lamp to ‘rub’ for more wishes. Over time privacy and security will take on a different meaning and the pursuit of traceability and transparency will take their place as our concerns.

Why will this change – simply because we need everything to be open?
As we become more open, more willing or coerced into trying the latest thing, the internet of things will increasingly determine our behaviours.

There are four powerful enablers that are working away at making a significant change in our lives. As we connect more, we change our ways of working, our thinking, our habits and our abilities to earn a living.

• The more personal devices will keep us in the anytime / anywhere state, demanding the services it provides will give us increased innovating opportunities.

• IoT will offer those (expected) guarantees of access into the physical world. Digital will fuse more with the physical and we have to keep open to explore this.

• Then we have the internet of people, all busy connecting and communicating that will promote the internet as the fundamental channel of choice, into user communities of selected groups, or broader communities that we will rely increasingly upon for data, content, services and increase our ‘digital currency’ to earn a living.

• Lastly cloud computing allows an infinite array of connecting apps, and your personalised virtual infrastructure, where you can receive, deliver, create and distribute growing services over the internet, extending your ability to innovate to a much wider market.

Yes, the world of innovation is changing, digital is changing it significantly.
We felt open innovation was a big enough deal, perhaps it was in its day but as digital implants itself into our lives, into our organizations, into our societies more and more.

We must decide if we stay open to allow it in or try to close it off and channel it in ways that will provide value, but those will be transitory moments before we need to go back and open up again.

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Publishing note:  This blog post was originally written on behalf of Hype and with their permission I have republished it on my own site with some small adjustments. I recommend you should visit the Hype blog site where they have a range of contributors writing about a wide-ranging mix of ideas and thoughts around innovation, its well worth the visit.

The post Our longer term winner is clearly open digital innovation first appeared on Building Your Innovation & Ecosystem Intelligence.

Well then, are you going all digital on me from your innovation activities?

Take care, it does change our view of the world, as we look inside-out or even, outside-in

So there we all were, getting really very comfortable in our open innovation activities, learning to collaborate and co-create outside our organizations.

Even our management has finally got “open innovation”.

We are encouraged and allowed to collaborate outside our four walls of the organization as the penny has finally dropped that “not all knowledge resides within the company”.

We had worked through some of the cultural stuff, shifted around the team who like to collaborate, pushing others less collaborative to the back; the conflict points, we had established the process, practice and tools.

We even have our legal teams on board helping sort out all the conflicting positions that open innovation 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 to as well, or we get left behind.
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 being generated already.

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

How fast will the digital revolution come into my organization? Are any of us ready for this latest onslaught? Do we have the new skills all of these digital technologies need? 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 recommend to 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’ is being ‘dangled’ in front of us.

Are we ready, can our organizations cope?

The more ‘everyone’ connects on the internet through the Internet of Things (IoT) then we will be experiencing even more of a bigger transformation. They forecast 5 billion additional people will connect to the internet globally in the next ten years all wanting to ‘give voice’.

Today we talk of ‘high-speed’ I just wonder on when ‘the day the internet broke’ or simply taking speed and putting it is greater context such as ‘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 continue 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 lies in the power of digital understanding

Question: 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 the growing services and networks that we require to manage it all?

Question: 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?

Question: 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 to, if the world is connected outside our window, we continue to struggle to lookout?

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

We are exploring 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 seem to be heading off into a new world where digital will reign supreme.

All this data streaming in, either open or closed in collaborative management 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 innovative digital doors or simply limiting it down, trying to control it for our sole competitive advantage?

Presently we are seeing the race to build platforms – but are they (really) open or (selectively) 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 the 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 it seems not in competition to GE, so others can utilize the resources and expertise being built up for GE to build their ‘closed’ system of innovation for their competitive advantage but will this limit digital evolution or allow it to be evolved through our growing ‘maturity’ to handle it?

So will we see open digital innovation or a specific type of closed? I’ll give you my best bet in the next post, on what will eventually win.

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Publishing note:  This blog post was originally written on behalf of Hype and with their permission I have republished it on my own site with some small adjustments. I recommend you should visit the Hype blog site where they have a range of contributors writing about a wide-ranging mix of ideas and thoughts around innovation, its well worth the visit.

The post Are you going all digital on me? first appeared on Building Your Innovation & Ecosystem Intelligence.

Without doubt, this is one of the most highly ambitious and bold initiatives I’ve come across.

I think anyone seriously interested in the combination of open innovation, the use of a collaborative technology platform built around a novel new business model within such a highly competitive industry of Pharmaceuticals should watch this initiative with growing interest.

It can point to significant changes in the impact and contribution of innovation management.

From its initial concept inception in 2004 and 2005, with the IMI established in 2007 as a Joint Undertaking, it has operated as an autonomous body for approximately a little over two years as I understand it.

Here I provide a fairly concise outline of its evolution and what challenges it is currently facing. It still is too long but it provides the essentials (I hope) on an amazing and bold initiative here in Europe and is worth reading until the end-really!

Background to the Innovation Medicines Initiative (IMI)
The Innovative Medicines Initiative is the largest public-private partnership aiming to boost pharmaceutical innovation in Europe and to speed up the development of better and safer medicines for patients. IMI is a joint undertaking between the European Union and the pharmaceutical industry association EFPIA. www.imi.europa.eu

With a €2 billion euro budget, IMI supports collaborative research projects and builds networks of industrial and academic experts in Europe that will boost innovation in healthcare.

Acting as a neutral third party in creating innovative partnerships, IMI aims to build a more collaborative ecosystem for pharmaceutical research and development (R&D).

IMI will provide socio-economic benefits to European citizens, increase Europe’s competitiveness globally, and establish Europe as the most attractive place for pharmaceutical R&D.

The European Commission’s Seventh Framework Programme contributes €1 billion to the IMI research programme. That amount will be matched by mainly in kind contributions (consisting mostly of research activities) worth at least another €1 billion euro from member companies of the European Federation of Pharmaceutical Industries and Associations (EFPIA).

IMI supports research projects in the areas of safety and efficacy, knowledge management and education and training. Projects are selected through open call proposals; the favoured way in EU funded projects

The research consortia participating in IMI projects consist of:

• large biopharmaceutical companies that are members of EFPIA, and a variety of other partners, such as:
• small- and medium-sized enterprises,
• patients’ organisations,
• universities and other research organisations,
• hospitals,
• Regulatory agencies, and finally any other industrial partners.

IMI’s overarching objectives

IMI’s overall goal is to build a more collaborative ecosystem for pharmaceutical R&D in Europe and to speed up the development of more effective and safer medicines for patients.

To reach this objective, IMI is creating unique, large-scale networks of innovation in pharmaceutical research. Joining forces in the IMI research and training projects, competing pharmaceutical companies collaborate with each other and with academia, regulatory agencies and patients’ organisations in order to tackle the major challenges in drug development.

The IMI Research Agenda

This builds on the recommendations in the earlier Strategic Research Agenda to overcome the principle causes of delay in pharmaceutical R&D by focusing on four areas:

• Predicting safety: more accurately evaluating the safety of a compound during the pre-clinical phase of the development process and the later phases in clinical development.
• Predicting efficacy: improving the ability to predict how a drug will interact in humans and how it may produce a change in function.
• Knowledge management: more effective utilisation of information and data for predicting safety and efficacy.
• Education and training: closing existing training gaps in the drug development process.

To address the main challenges identified, IMI will harness the know-how and expertise available across Europe’s biopharmaceutical sector, by pooling competencies and resources from the public and the private domain.

Expected effects

IMI will make Europe more attractive for pharmaceutical R&D investments and boost the competitiveness of European life science R&D. By directly addressing the challenges facing the pharmaceutical sector in Europe, IMI has the potential to:

• Modernise the development of medicines.
• Expand European expertise and know-how in new technologies to attract bio-medical R&D investment to Europe.
• Anchor R&D jobs in Europe and reverse the ‘brain drain’.
• Enhance Europe’s economy by strengthening the competitive position of smaller companies, enabling them to collaborate with a multitude of stakeholders.

The strategic imperative for this scale and scope of collaboration was the driving force.

A platform for better coordination, co-operation and collaboration among all the stakeholders involved in developing innovative medicines in Europe was seen as sorely needed.

To change the present situation, there was a real need to form stronger links between the stakeholders, more efficient use of modern predictive methodologies and techniques, improved management and sharing of existing knowledge – not yet fully utilised – better exploitation of promising strengths and assets, and upgraded education and training.

Equally the pharmaceutical industry is undergoing sharply worsening working conditions and many challenges. Escalating development costs, patent expiry on major products, increased competition including R&D activities on the global market, the perception of greater risk-aversion among regulators and worsening public image are conspiring to cripple the European pharmaceutical industry.

This has been seen as a negative spiral that would become highly detrimental to the European economy as well as to patients seeking relief from disease and illness.

The initial analysis relating to the benefits of a platform approach were expressed as:

• Exploiting existing strengths and assets in Europe and building on existing structures
• Ensuring the active involvement of member states of a community of 27 countries across the EU
• The platform can become as a brilliant vehicle for assembling the stakeholders
• Improve the necessity of communication for better understanding and collaboration
• Proper networking as a key to success can break down existing barriers
• Exploiting the platform to develop common standards and an ongoing innovative culture
• Ensuring the transparency of all steps and procedures in the platform had real value
• Better training and education of scientists to do the job in more open, collaborative ways
• Ensuring balance in selecting disease targets would have a potential greater impact
• Establish common standards for bench marking would give all equal opportunity to improve.

Recently in 2011 a first interim evaluation report was made by a panel.

At the time of the first interim evaluation, the IMI had operated as an autonomous body for approximately one year, had launched its first two calls and was about to launch the third call.

Fifteen projects from the first call had kicked-off and were ongoing, and a further 8 projects from the second call were under negotiation. These projects have been launched in the first few months of 2011.

The in-kind contribution from the EFPIA companies to projects in the first two calls is € 198 million and the financial contribution from the EU budget, disbursed by the IMI JU is € 190 million. This is slightly lower than what was foreseen at the launch of IMI (€ 199.5 million).

The IMI interim reports objective was to is to address the bottlenecks currently limiting the efficiency, effectiveness and quality of the drug development activities needed to bring innovative medicines to the market and provide a clarification of the positive progress made.

My extra note here

-Just take a look at what they are attempting to address.

• Through the IMI JU, Europe has succeeded in establishing a new business model between public and private sectors, which unites research strengths across European pharmaceutical industry, academia and small to medium enterprises (SMEs).
• The consortia formed carry out focussed research addressing problems of immediate relevance to industry and future public health. To have formed and embedded this new, applied, research environment is a significant achievement for Europe.
• The IMI development has been meaningfully enhanced by its engagement with the regulatory authorities and patients organisations. To have succeeded here is rare, and taken together with the scale of interest of research organisations, is a tremendous illustration of Europe’s strengths in creating consensus and collaboration.
• By facilitating enhanced cooperation between academic, SMEs, patients organisations, regulatory authorities and the pharmaceutical industry, the IMI enables mutual learning and the opportunity to build understanding of respective rationales and approaches, with benefits to all parties. This is powerful. Although at a relatively early stage, the dialogue now underway across the participating groups aligns well with the IMI  intent.
• The scientific scope of the initiative is well targeted, embodied in the IMIResearch Agenda, and the IMI JU has had the foresight to ensure that the Research Agenda is updated regularly. The first such review and update was on-going at the time of the Panel’s review.
• The financial resources available to the IMI JU, totalling €2Bn, make this the largest public private partnership in health research in the world. Yet the research challenges to be addressed with this sum are significant.
• The Panel was satisfied that the funding is being distributed adequately to help reach the objectives set and also saw appropriate consideration being given to the scope and scale of future projects to best achieve impact from the finite research funding.
• IMI constitutes a novel model for implementing the concept of “open innovation”. No other European programme has enabled cross-company collaboration within the pharmaceutical sector on the scale that has been achieved with IMI. This step is very important in developing open innovation in the health sector as it has enabled an unprecedented pooling of industrial research assets allowing scientific challenges to be tackled in a manner that could not be done otherwise.
• In many respects the IMI is an incubator for changing minds on how parties can work together across traditional boundaries and is therefore likely to have an important structuring effect in Europe, fully in line with the Innovation Union objectives

The panel also identified certain weaknesses for the Joint Undertaking bodies to address

• Internal governance structures are not yet working optimally: e.g. pace of decision making, clarity on responsibilities for key actions, crispness in assignment of accountability for tasks;
• Proactive communication activities have been lacking, as exemplified by the diffuse and varied understanding various stakeholders have of the purpose of IMI;
• The advisory potential of several stakeholders, such the European Medicines Agency (EMA), is not exploited fully by the IMI.
• The lack of identified and used key performance indicators by the IMI JU risks making the output of the whole initiative diffuse.

The Panel therefore came up with seven recommendations summarised below. Each is associated with a precise set of actions detailed in the report but not provided here.

1. Continuously improve stakeholder involvement in IMI-supported research projects
2. Continuously ensure EFPIA and Commission commitment to IMI’s success and sustainability
3. Ensure excellence and exploit new ways to support IMI scientific objectives.
4. Improve IMI communication
5. Reinforce and streamline decision making and well functioning processes
6. Ensure best use of IMI results and IMI sustainability
7. Develop monitoring and evaluation processes

The EU Commission has issued its response to this report- in summary:

The Commission welcomes the interim evaluation report about IMI. It takes note of the recommendation of the evaluation panel. The Commission is committed to working with EFPIA to implement the recommendations addressed to the IMI Governing Board, where the two founding members work together to give strategic direction and oversight to the IMI.

The Commission is committed to implementing the recommendations addressed to it and is open to collaborating with EFPIA and the IMI Executive Director implementing the recommendations addressed to them. Most of the recommendations can be implemented in the short to medium term and indeed many are already being addressed through actions from the Governing Board and the Executive Office.

Both the Commission and EFPIA are recommended to dedicate enough staff to IMI. The Commission considers that both founding members have shown extraordinary commitment towards the successful setting up of IMI, including the launch of the IMI JU as an autonomous entity.

Considering the number of processes that had to be established, the Commission considers that overall this has succeeded well, while recognising that some delays have occurred. It is inherent in a partnership between partners as different as EFPIA and the European Commission that it takes some time to agree on certain points, especially at the beginning.

With the IMI JU Executive Office now almost fully staffed, all operational responsibility has moved to it. Indeed, the Commission is committed to giving the Executive Director full autonomy for this responsibility

My conclusions

Without doubt this Innovation Medicines Initiative is something to be watched. There is enormous learning to be gained as it evolves. It is tackling some incredible and well-discussed barriers to innovation on a grand scale. Will it be successful, time will tell but recently the CEO of Glaxo Smith Kline, Mr Andrew Witty was very upbeat.

The industry is reeling from much in disruptive winds blowing and battering at its door. Taking this one imaginative approach on its own will not solve all the ‘ills’ but can provide a catalyst of real change. It can also provide us all with some significant rethinking of what is possible, when something is in crisis, as the Pharmaceutical industry certainly is.

This is a seismic undertaking that could have a profound impact on how we view collaborative innovation and what it attempts to tackle on the scale needed for many challenges we face. We can learn an awful lot from studying this initiative.

The post Open Innovation, Technology Platforms and a New Business Model- All-in-One Biggie! first appeared on Building Your Innovation & Ecosystem Intelligence.