Open for Business - Open Source Inspired Innovation

8/9/2019 Open for Business - Open Source Inspired Innovation

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Jaap Bloem | Menno van Doorn | Erik van Ommeren

Openfor BusinessOpen Source InspiredInnovation

Research Institute for the Analysis of New Technology

VINT | Vision Inspiration Navigation Trends


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Open for BJaap Bloem | Meo a Door |

Open Source


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Te Rise of Crowdsourcing

Now the productive potential of millions of plugged-in ent

the attention of old-line businesses, too. For the last decade have been looking overseas, to India or China, for cheap labo

matter where the laborers are they might be down the blo

Indonesia as long as they are connected to the network.

Jeff Howe in Wired Magazine, June 2006

Just as it is now impossible to think about getting things do

considering the role that could be played by the internet, so

impossible to think about how to solve a large social problem

considering the role of methods originally and unintentiona

volunteer programmers just trying to build a better program

Demos, think tank for everyday democracy, Wide Open, Oand Teir Future Potential

Te disruptive effects of the open source production proce

or greater outside the information sector, at first simply bec

effi ciency of information processing that will effect many otactivities, and second because of the spread of the model of

other sectors of the economy.

Steven Weber, professor at the University of California, Be

of the Institute of International Studies


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Contents

Foreword

1 Te relationship between open source andopen innovati

1.1 Ope source has may faces

1.2 See characerscs of ope source

1.3 Ope source sprao for oao

1.4 Crowdsourcg

1.5 Te oule ad srucure of hs book

2 Open innovation the new trend

2.1 Ioao wr large

2.2 Value creao wh ope oao

2.3 Hae ohers do he work

2.4 Produc oao he age of codg

2.5 Ope oao s somehg ypcal of our geerao 2.6 Webserces: lgh-wegh sofware for busess oao

2.7 Ope oao a Amazo, Google ad eBay

2.8 Ope oao a oyoa

2.9 Ope oao a Procer & Gamble

2.10 Ope oao seeker-soler eworks

2.11 Ope oao he press

2.12 Ope oao adersg ad markeg

2.13 Ope source beer from Brewopa

2.14 Ope oao a Boeg

2.15 Ope oao buldg ew compuers

2 16 Ope oao la CrowdSpr


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3.8 Su produces s ow hardware ad sofware plaforms, com

ad s pro-ope source

3.9 Coclusos o ope oao

4 What motivates an open source community?

4.1 Ope source sofware does o ad ca eer amou o mu

4.2 Hackg ope source ad he passo of he ddual

4.3 Who are hese ope source deelopers?

4.4 Is here a aboo agas makg moey?

4.5 Ope source deelopers wa o belog o he commuy

4.6 I hs gf ecoomy, s a maer of ge ad ake

4.7 Te gf ecoomy s a famly affar

4.8 Te ulmae kck kow as flow s he clcher

4.9 Why ope source s a rush

4.10 Cocluso

5 An open source culture is better

5.1 Ope source: a culure whch eeryoe seems o be dog

5.2 Mer s crucal ad users are oled

5.3 owards a ope source culure he sofware deelopme

5.4 From sofware egeerg o agle/ope source sofware de

5.5 Sofware egeerg, compoes ad he huma dmeso

5.6 Ope source sofware deelopme compaes 5.7 Dffereces amog radoal, ope ad agle sofware dee

5.8 Cocluso

6 How open is the future?

6.1 Publc ersus prae

6.2 Neher me or yours, bu publc doma

6.3 Permsso culure: ope uder aack

6.4 Prae plus publc he sofware secor

6.5 Cocluso

7 Tirteen lessons for open innovation


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Foreword

Open Up to the Crowd!

I was workg for Red Ha 2001. We were o a corpmpora cles ad dog our far share of drkI was o he sxeeh hole ha I made he ery presuha he premum beer we were drkg was oekeed ad ased ee worse, ad ha I could do bclosed for ex o ohg. O ha ery hole a Albe

Melboure Ausrala he course of my lfe chagedAfer spoug o all who would lse ha eemorg wh a heay head ad ee heaer challegecusomers (who do exs), o demad my beer (whcye) from my compay (whch heye eer heard oayhg o adersg or radoal markeg, w he dusry, whou a brewery or ay dsrbu

profiable?Of course he soluo was all aroud me. People. A

up shop my cusomers mds! Le hem hae ulbe her beer compay, o me! Tey make he decher srucos!

I had see he Lux Operag Sysem sar hakerel beg hrow ou o mllos of programmers mproe, sablze, ad ulmaely commercalze hHa. A y drop of waer makes o de o he ladsradrops ogeher ca raze mouas. Te ask for mradrops ad geg hem all flowg he same

Te oher challege was ha o oe had doe hs


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busess models, ad may more are coaed wbook you are readg ow.

Pint 1. Do It Wrong! Rewrite Rules of Engagement

Udersad he rules of egageme your dusry If feels wrog/ucomforable, youre o he rghbusess backwards. We sold a rual beer, go poad oly he worked our produco o mee demaof acquso ad me cusomers eeds ha were cumbes.

Pint 2. Polarize: Be Controversial

If o oe haes you he o oe loes you. Rejecohrea o success dfferece s. Sop ryg o ge cus o he oes ha loe you ad are emooal abo

compay.

Pint 3. Lift the Kilt and Let Tem Have a Fiddle

Ge Hjacked! Le your cusomers behd he scees a he deelopme of he produc ad sraegc dreche AC o her wshes. Ge hem boh emooal ashp f you ca. We gae all our members who oed

he compay were we eer o go publc he fuure.

Pint 4. Embrace Ambivalence

Look a your busess upsde dow ad back-o-froesses are old o o be ambguous bu cossefixed posos. Ts s creasgly ueable odadoxcal world, so embrace ambalece ad you wll frobus ad sable busess hrough your cusomer ba

Pint 5. Embrace Incongruent Consistency

Pop up where youre leas expeced. You wll sad oueyes ad f he messages ad e of he buses


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a he people clamorg o be famous. We all loe recouse your crowd.

Pint 7. Suck Less

Ts s o cofied o ope ad crowdsourced busa rule ha s esseal for success. Busess ad self-hally abou beg beer a somehg. Problem s, webe. We hae bad habs; we focus o he egae (whwha we are o). So why o use ha as a ool? A Breo be beer, jus less worse ha our compeor, less yeserday. If we are fie perce less worse hree arhe effec s compouded by more ha he fifee peparlayed.

We eer had a book o ell us how o be Ope fooe you hae before you, whe we sared Brewopa

he bleedg edge, deelopg robus ees ad prhad experece I hae dscoered ha, whe appledlgece, he pracces ad lessos descrbed he wll ceraly help you seg up successful opesourced busesses.

Liam Mulhall

CEOBrewopa Lmed


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1Te relationship between open soopen innovation

Tis book explains why and how open source and open in

ging. In the context of software development, we know of ope

manner of collaboration among motivated individuals wor

As a concept we know specifically from product developm

is an extension of traditional R&D. Te new term for the c

crowdsourcing: an appropriate marriage of the terms (out

surfing. What this means is that Te productive potential ofis attracting the attention of old-line businesses. It doesnt ma

are, as long as they are connected to the network. Tis is the

his groundbreaking article Te Rise of Crowdsourcing, whic

2006 edition of the monthly magazine Wired. Te central con

will be discussed in further detail in Section 1.4.

raditionally, R&D is the source of innovation. Companies, have always painstakingly conducted R&D on their own. T

inventions in order to introduce their own unique products

sary, and often only after a great deal of time, licenses wer

discoveries. If market standards were involved, as in the case o

ons followed, and ultimately consolidation into competing co

situation remains more or less the same, although it is even

the companys own R&D as a source of innovation, we a

source and open innovation ever more frequently. In addit

open innovation are merging and consolidating. In both c

based on an unusual form of collaboration that contrasts w

of doing things


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Te seadly creasg egrao of sofware ad, cosequely, o busess oao explas

gleme of prcples ad bes pracces from sofwarhose of ope oao for produc ad assocame.

Converging openness

Eery player oled he purely propreary sofwe years ago ow embraces ope source as a useful soal sofware deelopme pracces. Ad eery parme s currely parcpag ope oaohs acy, may flourshg commues ad cadopg a mxure of pracces from ope source a

Somemes hs egrao occurs coeco ws ohg wrog wh ha, as markeg s a essesuccess), as exemplfied by ope source shoes. Oher ly alrusc aes, such as he field of ope souresearch. Commuy spr s a mpora commboh ope source ad ope oao. Te ews couly are que derge, howeer. Obag marke

he drg force behd a free polcy. Bu o heR&D sde of hgs, cleer hadlg of paes sll plad he, hs meas ha sofware compaes releagrammg. Tey do hs order o curry faor wh he ope source commues queso, ad ofe aogog deelopme coss ad o acqure beer sofquckly. I produc-maufacurg secors, Procor &of may compaes ha hae, for a lle whle, beeless proece pae polcy ha hey had he pasdeal of profi as a resul. Ts coergece of ope sooao promses o be a mpora feaure of our


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A firs sgh, ewed from he perspece of he o, he commual characer ad he o-commerc

ope source projecs may look suspcously uruly. Buerwse. IBM has esmaed ha s sofware producperce more effi ce by culag a ope source ca oly hre whe sofware s cosruced modubewee he fores ad he rees mus be crysal cleacommues may lose her dreco ad persoeesure he couy of her work.

I fac, ope source meas esurg ha he aleesers, etc. are properly ulzed ad ha he eam fuleel. I redseg ope source projecs, such asJBoss, here are leaders who make decsos; here o; goals are made explc, ad here are ofe well-ad procedures. Messg aroud s o really allowed.

s ealuaed, ad f here s dsagreeme o some poumsakable erms. Wha cous s he resul. As asource does o mea a ucorolled ad uruly pmous wh precse kowledge of wha you are dog, whch people kow her role ad udersad he

Compeo amog he members of a ope sourcord he bes resul srogly affecs he qualy of he

Te 23 perce growh of Lux o he serer markeo 4.4 perce marke growh) would o hae bee pd ad raspare produco maageme.1 Nearly webserers ad herefore early all ere raffisource sofware. Due o he success of he ope-prodsofware dusry, has become worhwhle o esof usg such a model for oher busess oaos

1.1 Open source has many faces

Ts book wll deal wh all he specal characersc


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Ts book wll show how ope source has chaged wha he prcples behd are, ad how hey are

where. Te eo s o lear from hese examplehe coeoal process of oao, as he coope source culure ousde of he sofware dusry sequeces for he maer whch producs ad serew ype of oao s emergg, spred by whpeed he ope source sofware moeme.

Te power of open source

Ts book could hae sared by meog ha NAPahfider o Mars wh a srog dose of ope sourceoboard sysems. Problems wh he sofware woul

reersble falure for he ere projec.2

Would NAhe mmum of rsk wh such a bllo-dollar projsource sofware s capable of workg a he hghes leo eed o be defeded.

Ope s o opposed o closed. Ope source hashroughou he sofware dusry ad embraced bypas, cludg Mcrosof. Sll more mporaly,

source he I secor has bee smply a queso oopposo. Combg he adaages of ope ahe dusry sroger. Ope source sofware has psource culure, he lfesyle surroudg he maufacsofware, s emergg as a rgug opo ha s ousde he sofware dusry. A ope source maeay of s arous mafesaos, s becomg morexcepo. Cosequely, comes as o surprse haof producg sofware was a source of sprao for aess: ope oao.

Ts book s o prmarly cocered wh wha caope source sofware I s o focused o ay ed pr


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Innovation la Henry Ford

Ope source sofware has acually become raher ccosder he qualy of he producs, he serces surhe growg marke share. Te specal sgficace ofrom he eormous chage ha has produced ad sofware dusry. Rapdly growg ew compaes hwh ew parershps bewee radoal ad pureers, as well as ope source aes uderake by ers hemseles.

I sofware deelopme, marke oao goesope source. I Calfora, Professor See Weber, wpear seeral mes hs book, descrbes ope sourcHery Ford. Ope source also has somehg o do whch hgs are produced. Te produc self (be a c

sofware) s perhaps o so oae; s he warepreses he rue oao. I hs book Te SucWeber pus hs way:

If I was writing this book in 1925 and the title was Te Secre

argument would be about the factory assembly line and the

production around it, not about the car per se. Once we are

production process, a way of making things, then the story imuch greater importance than simply to a few specialists. P

more broadly than do artefacts. oyota pioneered lean prod

that made cars. 20 years later this way of making things had

throughout the industrial economy. Similarly, open source h

a way of making software. Te question becomes, what are t

boundaries for extending open source to new kinds of prod

and perhaps of physical (industrial) goods as well?Steven Weber, 20043

Tere sprgs o md oe obous smlary bewee


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1.2 Seven characteristics of open source

Before gog o he lessos ha ca be leared aboope source, les firs cosder wha ope source s, dsc characerscs, sarg firs wh he fac hake he lead oao. Tree dduals deserao hs regard. Te firs s Rchard Sallma, hally sared all. Frusraed wh he fac ha sofwhbed from accessg he sofware code because comake as much moey as possble from sofware, he foware Foudao (free he sese of lberaed).

Te moeme deeloped a ew ype of copyrgh waed o parcpae sofware oao. Laer, Bsecod perso o our ls, worked wh a umber o

Apache webserer sofware, oe of he mos successf

ware producs o dae. Behledorf he used hs kowo lauch a collaborae plaform called CollabNe: huof people ow work o ope source projecs o Collao he ls s Erc Raymod. He smoohed ou he rougme sared by Rchard Sallma, producg refiemly smulaed he furher commercalzao of ope s

Nota beneTe seven characteristics mentioned below are closely relessons of open innovation that collectively constitute thethis book. Te reader could simply adopt all twenty withobut that would miss the case histories and the analysis intervening chapters. Instead, the impatient reader coulby reading Section 1.4, which briefly sketches an outline an

ture of this book.

Characteristic 1: Special licenses ensure that everyonesource code; they also protect the community of dev


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of users had made mpora corbuos was o aalable. I 1985, Rchard Sallma se up he Free S

(FSF). Is purpose was ad sll s o proec he relopers who waed o work collecely o make sofhe rsk of copyrgh clams by hrd pares. Terefora ew ype of corac called he Geeral Publc Lcescommoly kow as copylef coras o he saeffec he GPL proecs he rghs of sofware makers o freely buld upo he producs. Free sofware begaware delered alog wh a source code ha eeryoeo creae ew ersos, or ee ew sofware. I was aLus oralds obaed a GPL for he Lux operareassure hs Lux commuy ha whaeer hefreely accessble o eeryoe. Varous ypes of GPL bodg agreemes for parcpao ope source

Characteristic 2: Users take the lead in the developm

A he begg of he ees Bra Behledorf, Berkeley, was kerg wh he webserers hs bupuer lab. Hs sklls were recogzed by some of he

ze Wired, who subsequely ed hm o se up magaze: Hot Wired.

For hs webse, Behledorf used a ope source proal Ceer of Supercompug Applcaos (NCSA)all he eeds of he Wiredwebse. Accordgly, he madad ohers dd he same for her specfic purposes. The ame Apa[]che) were se back o he NCSA, w

mpleme ad suppor all he chages. Terefore, Beake corol hmself. Workg wh a small group, hewh all he paches was compled ad rewre as hso-called Apache webserer. Behledorf laer reealeo of hs sofware projec was prmarly based o


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abou a 70 perce marke share. No oly s sofware muy eerprse, he commuy also prodes user

dorf ad he oher deelopers were uable o prodsuppor, he users bega o orgaze hemseles. Afree user-o-user asssace fucos remarkablKarm Lakha ad Erc o Hppel4 shows ha a como a all requred o oba good help for quesosere ad rual worksaos eable users o assely.

Laer, Behledorf esablshed he rual worksawebse where people who wa o work o ope sourad collaborae. Te umber of regsered CollabNemore ha 700,000. Aoher rual plaform for sofcalled SourceForge umbers oer oe mllo users.

Characteristic 4: Self-determination and intrinsic modominant open source principles

Web eromes lke CollabNe oly represe he busess. Wha moaes people o make someherely dffere sory. As already oed, oluary a

os by dduals hae produced hgh-grade sofwahe Apache webserer, he Lux operag sysem, ad he JBoss applcao serer. New sofware s cplc coracs or payme. Self-dreco by people wpae whou dreco from a boss, as well as srog whou he eed for moeary reward, makes up hehe ope source sofware moeme. Ts self-maag

he experse of parcpas ope source projecsbes possble maer. Eeryoe ca selec a persoaurally leads dduals o perform work whcw recogo for . Te rsc moao s prhe work self Te exe o whch sofware deelop


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ad he qualy of he work. Polcal games are slgh he ope source world.

Characteristic 7: Te success of open source has genermodel

Sce 1998, he ere free/ope source ladscape hao a mxure of boh closed ad ope source comm

cal sofware compaes hae become progresselyope source. Salared employees a Su McrosysemOracle, SAP ad HP hae bee sruced by her emrae ope source commues. Te free ad opecreasgly used for wha was oce closed sofware pad whch has ow become aalable as ope source. F

made s Solars operag sysem aalable uder a so he orgal housad deelopers ow collaboraeprogrammers ad esers he ope source commfully embraced he ope source produco model, wo ad rsc moao as a gudg prcple. Ture s see as a way o mproe a compays produhrd. Uder he labels of commo source, shared

muy source, he ope source cocep s spreadclosed sofware facores of he commercal sofwareme, a creasg umber of ope source compawo lceses: a ope source lcese ad a regular Lle seems o rema of Rchard Sallmas dealslosophy, bu we should o forge ha may ope sourfor example are sll aalable hrough a GPL lces

1.3 Open source inspiration for innovation

Te characerscs defied aboe user oleme


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Te mos mpora oao does o ole hbu raher how hey are combed ope source sof

he success of ope source sofware, should appeal o ager. Te aural expecao s ha hs success, heors ha makes ope source such a compellg pheplcable, oe way or aoher, o oher fields: srg for oao, bu also ousde of hem ecer ha he sofware dusry.

Open innovation

Wh ope source he suble of hs book ad heoao geeral ad o oly he sofware dg o use he erm ope oao. Esseally, w

o here may jus as well be called ope oaos ope source ad ope oao; oe, howdo always mea he same hg. Hery Chesbrohe Uersy of Calfora ad Drecor of he Ceo, publshed he sadard book o ope oaope source does o occur hs book ad ohopeg of oao by olg users he

Howeer, here are ceraly mpora parallels, uderlyg ope oao as ewed by Chesbrouszes he eed for a ouward-lookg sace bu alo abado he dea ha hey mus keep all kowledorder o dsgush hemseles he markeplace. he maageme of a compays ellecual properbeer ad more cleer sraeges, f oly o accou

o acqure ad maa paes all aroud he wors he opeess geeraed by ope source sofware dare cocered wh, ad whch prodes us wh a sfie he defio of he cocep ope oao.g ellecual propery ad aracg (exper) u


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a maer of publc polcy order o foser oagrowh he U.S. ad world ecoomes. Te DCC s ch

seor VP Research a IBM.I coras o closed oao, ad keepg he s

of ope source md, classc ope oao gesboh forms of opeess mgh reforce each oher. Apreseao from Phlps, exraced from he 2004eled Vitalizing the Knowledge Economy (Vitaliseringmie) makes hs po clear. Te ew s dered from

o Plaform by Herma Wjffels ad Tomas Grosfo repor, ope oao s cluded alog wh eraoalzao. kowledge ecoomy as a ecad muldscplary ways of approachg research o.

Closed innovation Open innovation

Te brightest people in our

fi ld k f

Not all the clever people w

fi d i h


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Closed innovation Open innovation

Te first to announce aninnovation is the winner A good business model is being the first to market.

Whoever has the most and the

best ideas, wins.

If we make the best use of

ideas, we will come out on

We have to protect our

intellectual property so that

other companies cannot makeany use of our ideas.

We must profit from the u

property and we must use

perty of others that suits o

Here, ope oao s clearly preseed a beoao. Te po a he op of he rgh colum

(No all he cleer people work for us; we mus fihese oher huma resources) s key o a ope souals makg good use of he ere ad g usorder o ake adaage of all aalable experse aherefore o profi from rsc moao ad self

Cosequely, he ceral prcple of ope oamakg cleer use of kowledge ousde he compa

possbly from mpora users of he producs as wPhlps, you wll hear ha hs compay has bee bupae maageme ad collaborao wh parersmore effecely. So Phlps was log ago praccg o, bu has ow also ploed a clearer course sofarof ed users s cocered, as demosraed by he fclppg:

Philips experiments with consumer-led innovation

Producers who are open to suggestions from lead users [or i

ed.] can improve their products faster, states MI professor

Philips puts the theory into practice by means of the websit


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Te central principle of open innovation according to the

echnology Policy Council, AW

Te shift from closed to open, collaborative, innovative procassembling various types of knowledge to form chains and n

only involves technical and social-scientific knowledge but a

experiential knowledge of end users. Terefore the innovatio

relevance to services, experiences, and users than to produc

I he Neherlads ad elsewhere aroud he globe,s arous guses s a major ssue. I December 2006,of Ecoomc Affars, cojuco wh he OrgazCo-operao ad Deelopme, OECD, held a ero he opc, he coex of globalzao. Te cofby Hery Chesbrough, Wm Vahaerbeke ad Erwhom were meoed earler; Erkk Ormala, who acof echology Polcy ad s a former Secreary of he Sogy Polcy Coucl of Flad; Yuaka Yoshmoo, a C he Pars Offi ce of he Japaese Msry of Ecoomry; ad las bu o leas he Duch Scece ad echcl AW, represeed by Peer Adraas. Ts clearoao s a ho opc o he ecoomc ageda m

res.Ope oao ad ope source mrror each oScece ad echology Polcy Coucl, AW, deeerprses whch ope source sofware s promewha Chesbrough cocees as ope oao. Acludg ed-user experece has grow eormouslyof all due o he ere, whch faclaes coac mo

ohers o parcpae oao; ad secod, becapeople are profice ad eager o be dgally ace.creasgly easer for users o parcpae.

Te raoale behd ope oao s o hae aworkg for oe compay Ts s represeed o he l


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doal approaches o oao, o he lef sde. Owa o ear as much moey as possble from he

hese dscoeres creasgly come from ousde hresuls. Afer all, who ca clam o be he ower of a pay or he commuy ha produced ? I legmeas ha o excluse rghs are permed ad eporuy o ear moey from collecely deelopedmoey ca be made hs way s demosraed by opSpecfically, compaes ha ca add alue o he sof

cusomers. Te wo forms of propery rghs are hereeach ca be used o ear reeue. Neerheless, a ehem, a subjec o whch we wll reur Chaper 6.

Figure 1.1: Open source revitalizes classical open innovation

1.4 Crowdsourcing

Users take the

Leading princ

expertise

self-determi

intrinsic mo

Copyleft

Organizing

Open innovation

Patent and copyright

Not all clever people

work for us; we must

find a way to tap into

these other human

resources

It is increasinglyeasier for usersto participate


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Crowdsourcing

Ts all chaged Jue 2006. Ta s whe he ersuddely surfaced Wired Magazine.14 A ha me, he orgal source of crowdsourcg, ope source sJus lke Jeff Howe, we had oed ha ope source pwere spreadg o oher ecoomc secors: early sag.

I he meame, crowdsourcg was becomg h

all ypes of ope-source-relaed oao wereCrowdsourcg brgs a whole array of opeess, radeelopme o produco, uder a sgle oerarchbe mmedaely ad uely udersood.

Jeff Howe, the editor ofWired, was the originator of the term

Crowds are ere crowds, ad hey ca collabora

ou crowd members acually beg close proxmy same me. I fac, beg ole smulaeously s of mos cases, o absoluely ecessary.

Of course, o eery ere crowd s made up ofdozes of people; jus hk of he expresso T


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Innovation happens elsewhere

Ulmaely, ayoe wag o ap o he publcs cge approprae cosderao o seg he procesallow crowds o work o her ow ad see wha cobra House sofware compay operaes such a mamember, do he hkg, programmg ad esg.member, hae a large share he profis as well. Sewha he compay s especally good a15. Te resul

uc s wha hey call crowdsourced sofware. Te sobee o o hs for wey years, oly ow he crow he profis.

Howeer, s also possble o choose o hae greaer Tere are all kds of aras, alhough he domaIoao Happes Elsewhere.16 Beg ope o hesseally requres you o look beyod your mmed

he ere o faclae collaborao amog he rallow hem o do her ow hg.


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o guded effors such as he Global Ioao Jam21

opg he Wkpeda ole ecyclopeda22 o asss

me of medce as par of he ropcal Dsease IaApache Ope for Busess Projec11 o user-dre 3M ad oher orgazaos.

I s remarkable how may people are ace o he ery dffere crowds. Tey are workg ogeher fscece, for a compay, purely for moey, or ay cludg deelopg faser ad beer oao fo

suos.

Peer-to-peer e-mancipation

Peer-o-peer (abbreaed p2p) s a buzzword ha scoex24. Lerally, p2p s he drec e-commucaopeer (lke or lke-mded perso) wh aoher. Succoac wh he ere populao mus o, howh a complee p2p ecoomy.


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prcple, creasgly more dduals ca be seredp2p sads for he creasg ere oleme o

of he may wdespread lke-mded people who are c sads for a e-macpao ha more ha eer cusomer o he kg, especally whe such ddusoereg crowds.

Te sgfica ecoomc acy assocaed whrule s perhaps bes demosraed by he well-kowod Lfe rual world25. o beg wh, could e

whou he effors of a ehusasc crowd. Besdesacqure all ypes of rual commodes, ragg fresae, more ad more real-world compaes are becod Lfe, compaes such as ABN-AMRO, IBM, PhlpsNssa.

YOU!

Wh all hs md, s o surprsg ha ime Med YOU o a place of hoor, jus as Busess 2.0 had

YOU are a ddual who s acely corbug he Iformao Age. YOU represe a class of peopl

umber: all hose dduals whom we call prokow as dgally produce cosumers.A few of hese prosumers, whom ime Magazine

whe eleced YOU as perso of he year, are he makake a look a he webse. Is a compac geerc eleca ac lke a clock rado ad also exchage phoos your freds. Bu firs ad foremos, YOU ca add f

course, chage s looks accordg o your whm. Tpo s ha he Chumby does o come from he deslarge elecrocs maufacurer. I was smply houghhackers ad made by hackers for oher hackers, whker wh furher maly o erch her Ne lfe


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ad gradual, complee wh ups ad dows, as well as ha we kow so well from Garer28.

Tis hype cycle was devised by Gartner in August 2006 and ch

technologies of the modern internet

Crowdsourcg s o lerally meoed o he abhough collece ellgece comes awfully close cycles peak. Moreoer, crowdsourcg s srogly

whch s precsely a s summ. Te producy plareached or has ? For where would you place Lusofware secor s far ahead. A world whou crowdsbecome uhkable, ad crowdsourced ayhg smomeum

echnologyrigger

Peak ofInflated

Expectations

Trough ofDisillusionment Slope of Enli

visibility

DNA LogicTera-architectures

QuantumComputing

Prediction Markets

Augmented RealityOffline Ajax

Speech-to-Speech TranslationTelepresence

Event Driven Architecture

Collective IntelligenceModel-Driven Architectures

RSS Enterprise

Corporate Semantic Web

Speech Recognitionfor Mobile Devices

IPv6Mashup

Web 2.0Folksonorries

Digital Paper E-PaperSocial Network Analysis

RFID (item)

Grid Computing

AjaxRFID (Case Palet)

Biometric Payments

WikisCorporate Blogging

Mesh Networks:Sensor

TabletPC

Mobile Phone PaymentsLocation-Aware Techno

Enterprise Instant M

Location-

Sma

Years to mainstream adoption:

less than 2 years 2 to 5 years more than 5 to 10 years

time


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eery sage of hese processes. ake ogeher, hese maer whch produco, R&D ad markeg c

chaged by hs ope model.

1.5 Te outline and structure of this book

Followg hs roducory chaper, we ake a closer lo ousde he sofware secor. Subsequely, we re

he ope source moeme wh he sofware secake he lead embracg he ope model, wh a dha s descrbed Chaper 3, whch s where we hghoao o be draw from ope source sofwaremore specfic chapers we come o he core of ope sesseal elemes ha ca sere as sprao for bI hs way, he characerscs of ope source are passscope of hs book. I Chaper 6 ad preparao lessos ha, as meoed preously, are closely relaacerscs of ope source Seco 1.2, we pose he How ope s he fuure? Each of hese chapers s breTe cocludg chaper, Chaper 7, coas he hrrelaed o he see characerscs of ope source

Chapter 2: Open innovation the new trend

I he roduco we breezed oer he cocep of lle oo smply, bu we wll ceraly make up for hser wh referece o heores by hree expers o

dscuss he ssues greaer deal.Te firs, Joseph Schumpeer, s he orgaor of

of oao ad he ma who defied oaomus prmarly make cash regsers rg. Te edehas happeed wh ope source sofware s preseed


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he cosumer-led oao of whch ope source sousadg example. I s eresg ha he rus

produc chages boh sde ad ousde he sofware he relao bewee ope source ad oao pom-up aes of users.

Chapter 2 provides examples of open innovation and shows

generation participates in this model.

Nex, he secod chaper specfically descrbes he exoao elsewhere -ousde he I secor. Exampsecor, he arcraf dusry, pharmaceucals ad dusry skech a eresg pcure. I seeral asecors, effors are made o explo he possblesad o expad upo hem. Te chaper reeals ha husers, whch s amed Geerao C (for coeao), show hemseles o be sroger ope oa

Chapter 3: Te software market has taken the lead

Te hrd chaper oules he game ha s played bywho corol he I dusry. Tere s o a sgle poled wh ope source. Ee Mcrosof, so frequebg oppoe of ope source, has become lked why of deelopers ousde s ow compay walls. Msads wha ope oao ca mea. Te same cacompaes ousde he sofware secor. Te I marke

e he lead, ad s adace ca be measured by whag hs marke. Wha hey are all aempg o dJoseph Schumpeer has descrbed he rue pcure roao s exremely ejoyable ad excg, bu hg o geerae busess Precsely for hs reaso


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Chapter 3 describes how open source has transformed the I

how this sector is at the forefront of this new open trend. Ul

jarring wake-up call to other sectors concerning the power o

We wll reeal he seps ha a umber of large suppmake her compaes ad producs more ope. SuchMcrosof, IBM ad Su use ope source, firs of all, a order o furher domae he marke. We exam

ogeher. Te I esablshme wll be led up ad cchallegers. Compaes such as MySQL, Zed, Red oher ope source eerprses hae joed he comhese compaes ge he moey o eer he marke aWe wll see how he esablshed order collaboraes wee by buyg hem ou f ecessary.

Chapter 4: What motivates an open source communi

Chaper 4 esgaes oe of he mos mpora ssuca each us: wha moaes people o parcpae sofware, mos cases whou receg ay paym

Ad he crucal sprao for hs esgao clesubseque queso: wha ca we lear from hs rego oher busess secors?

Ts chaper carefully exames he ew geeraohae collecely bul sofware producs such as Lugog? Why are hey dog ? Wha moaes hem?

Chapter 4 considers the most fascinating questions surrounWhy do people do voluntary work? And what does this mea

innovation outside of I?


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Chapter 5: Open source culture is better

Moao aloe does o geerae producs. Tere mad a leas a mmum amou of focus order o bproduco. We expla how such compaes as Apachable o succeed hs regard ad how Lus oraldkerel. Te eresg ssue regardg he goeracommues s ha hey deae from he well-kow a umber of mpora respecs; eerheless, s

a umber of good producs hae resuled. Te queswhy all sofware s o made hs maer. Could obe appled o he maer whch your compay s csofware?

Chapter 5 reveals the extent to which open production and

has already become mainstream. Te software industry is lea

the inspiration for applying open innovation elsewhere lies h

that can be drawn from this production method.

A ope source culure has a beefical effec o heproduco. Remarkably, hs s recogzed by eery

markably, he curre maer of sofware producery may ope source ras whou defyg seerae effors o esablsh ad culae a ope sourcepay walls hae ejoyed lle success o dae. Wal She Isue for Sofware Research a he Uersylyzed hs ssue. Te commuy-source ae aellg ee. IBM expecs ha he offi cal esabl

source culure wll eable o deelop s sofwarefaser. Mcrosof s followg hs lead. Te problemslery of Wdows Vsa whe he projec was sll calcaused a ew wd o blow hrough he Mcrosof sofculure Bll Gaes gae he order o desg more


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ware ad oher creae work, whose owershp s seccopyrghs, wa o cash o her creaos as muc

eer, he ope oao model hres bes whe edge s he subjec of as much elaborao as possbquesg permsso o use cera propreary elresome ad early mpossble ask. Should we o of owershp proeco? Are we o rapped a leloger sus hs oae age whch we fid ours

Chapter 6 describes how the struggle for ownership is a tensprivate property and the public domain. Tis struggle is crit

development of open innovation.

I s far from cera ha he fuure wll be sgficaare reacoary forces ad hey hae eeryhg o doflcs surroudg owershp. Te erse of ope, dscoery, s ceraly o rerea. Udersadablymake moey from her oae effors. Bu paradhe rgh o ear a buck from a compays ow R&D omc growh. A leas, opos derge o hs ssueof such coflc wll be examed from hree pos o

ery, he publc doma ad a bled of prae ad puWha hese faces of he legal sysem ceraly mesablshed order, boh he sofware world ad ofigh ooh ad al o defed s busess model. Buappare s ha he permsso culure whch weproducy.

Notes to Chapter 1Shaklad, S., Wdows Bumps Ux as op Serer 21, 2006, ews.com.com/Wdows+bumps+Ux+as0-1016_3-6041804.hml?ag=hml.aler.Norrs J S Msso-Crcal Deelopme wh Op

.


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o-promoe-ope-sadards-source-oao; wwecom.shml.

Wjffels H. & . Grosfeld, Vitalisering van de kenniontwikkelen en benutten van de mogelijkheden van menseen dynamische kenniseconomie, Ioaeplaform, Norug.l/lg/documee/ValsergVaDeKesEcowww.emerce.l/euws.jsp?d=1102473.

AW werkprogramma 2005: grosljs a mogeljke aw.l/uploads/files/grosljs2005.pdf.

www.me.com/me/magaze/arcle/0,9171,156951www.ofbz.org.e.wkpeda.org/wk/Ope_Ioao; www.opeleaduser.com.www.wred.com/wred/arche/14.06/crowds.hml.www.cambrahouse.com.dreamsogs.com/IHE.www.echora.com.www.youube.com.www.murk.com.clckworkers.arc.asa.go.www.globaloaojam.com.wkpeda.org.

www.ropcaldsease.org.www.p2pfoudao.e.www.secodlfe.com.moey.c.com/magazes/busess2/peoplewhomawww.chumby.com.www.garer.com//page.jsp?d=495475.www.redha.com/abou/ews/prarche/2006/ear

.

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..

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2Open innovation the new trend

Tis chapter presents a few examples of open innovation. Te

some conclusions based on the general tendencies illustratedevident that open innovation belongs to the current genera

this generation is initiating respond to further refinements in

tion. Disruptive innovation is the label applied to open sou

vation with monumental consequences for the market. Expe

innovation could be equally disruptive in other sectors. Te t

the extent to which the software market has been transfor

focus on other sectors, which lag a bit behind in terms of innit is prominent in a number of cases.

From consumer to producer

Ioao producs, serces ad markes has bformed as a resul of echologcal deelopmes. Tspecfic sofware ad lghwegh sofware he fhae made possble for users o become oled oao. Ts ca ee occur whou he suppororgazao. A commuy ca maufacure s owsource sofware, for example. Expadg he cosum

(jo) producer he so-called prosumer helps oproe producs, o smulae R&D ad o uderake akeg. Ts ges rse o he hrea ha a produc maself mgh oershadow exsg producs. Te ereproduc eed o be compleely polshed for o pos


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has bee called he coe creag geerao: shor. Half of hs bllo hae already made dgal

such as a webse or dgally mapulaed phoos. Cohow o reach hs dgally produce geerao cafrom hem. Geerao C uses arous laguages o bural spoke ad wre laguages o he arfical lagrammg. Te edecy s for he more complcaed lcreasgly smple, eablg creased oao: foprograms or mash-ups, whch are based o so-calle

be used compay R&D.

Open source innovation

ogeher, hese facors corbue o a crease alog wh a creasg prealece of ope sources

es ca work. New specficaos ca be added or dehese sources, ew producs ca be fashoed ha compleely uque role. Jus as ope source sofwaspecficaos oher fields s a mpora elemeo. Taks o rapdly growg opporues o creucs, processes ad serces based o a dgal desg,

o s o loger lmed o sadard sofware producsysems, daabases, scrp laguages ad web browseo be foud he CAD/CAM doma, bu also chemsry ad bo-compug, such as he pharmacered s ha progressely more ope-oao projma-specfic ope source formao mapulao

Examples of open innovation

Oe ca fid a rch array of examples of ope source of he sofware dusry: a Korea ewspaper ade


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or medcao makes a major dfferece hese exampora dfferece s he laguage whch people c

ere ecyclopeda s wre ormal huma lahae o maser webserces or CAD/CAM sysems parcpae.

2.1 Innovation writ large

Ioao ca be modes, cossg of small adjuscompay oe way or aoher. Obously, we wouldcal breakhroughs ha kock he compeo back oheay blow. Ope source sofware deelopme beype; s INNOVAION capal leers. Te roda parallel bewee Hery Ford ad he produco esembly le aed. Bu hs parallel does prod

all ha ope source oao eals.Ioao has a umber of araos: produc

oao, marke oao, orgazaoal ofoudao of hs mulfaceed cocep has bee dSchumpeer, oe of he mos mpora ecoomss ury. I hs Teory of Economic Development1 publsh

peer descrbes fie ypes of oao ha hae aaras ha we hae jus eumeraed. For Schumpefollows:he roduco of a ew produc o ye kow o roduco of a ew qualy of a famlar produc;he roduco of a ew produco mehod ha ebased o a ew scefic dscoery;

access o a ew source of raw maerals ad sem-fihe re-orgazao of a dusry, such as he esabllg of a moopoly; adhe opeg of or ery o a ew marke.


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s based upo he self-deermao ad rsc mcpas. Addoally, he ere s a ecessary c

makes dsrbued work possble. I hs respec, po, access o a ew source,, mus be see as he ceoao. No all he cleer people work for us; wap o hese oher huma resources. Access o brcompays ow orgazao s, essece, he greaTe reorgazao of a dusry, he fourh ype of possble whe ope source sofware aaed rue eco

I s also for hs reaso ha we ca aga sress he ope source capal leers.

Te fial form of oao (he opeg of or eke) ad he firs oe, whch we skpped oer for he (he roduco of a ew produc or a ew qualy) aargume made by Clayo Chrsese, a exper ooao.

Chrsese s a professor a Harard Busess Sco buld o Schumpeers deas. Schumpeer spoke aboo whe he was referrg o large, ralblazg odeas, echologes ad sklls were made superfluous bbusess aces. Chrsese prefers o use he wdescrbe ralblazg oaos.

He defies he ope source sofware moemee oao. Remarkably, he cosders ope sourdsrupg effec o accou of he qualy of swords, he ssue cocerg ope source abou whch so he queso wheher he producs hemseleoae s rased by Chrsese precsely o ddsrupely oae. A he Ope Source cofer

ese explaed ha dsrupe oaos do oours de force ha corbue somehg subsaaelopmeal pah. Dsrupo ca also mea ha a bdeelopmeal pah order o esgae a more ru


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Clearly for Chrsese, he power of ope source sofcombao of he firs ad las ypes of oao

defio: he roduco of a crummer ad smbasc fucoaly, ad (as a drec resul) he aopeg of a ew marke. Presely, mos ope sourcg a lle easer o use ad ca also be hadled byprogrammers. As a resul, ope source sofware owof prce ad fucoaly wh sofware from wha Chas he radoal rajecory of mproeme.

I Te Innovators Dilemma, Chrsese explas sece, wo ypes of dsrupe oaos: low-ed dmarke dsrupo. Varous ypes of buyers are assoc

Low-end disruption

Buyers for whom he exsg produc acually offeeses oershoo effec), ad who are eresed ca do less ha wha s beg currely offered o hferle groud for low-ed dsrupos.

New-market disruption

Buyers who could o preously afford he exsg pdely araced by a ew, less expese offer. Scesofware has become more user fredly, hs dsrupeffec.

Clayo Chrsese s o he oly oe who has

rupe characer of ope source sofware. Te followalso make hs po:

Open source software development disruptive

Disruptive technologies like open source software developme


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Te great open source debate [in 2006] will look at how fre

technology, as a disruptive technology, has changed the wayindustry does business and the new opportunities it has spa

Eweek, 20065

2.2 Value creation with open innovation

Maageme gurus C.K. Prahalad ad Vekaram Rhe urgecy of drawg lessos from ope source duecoss compaes o coue o creae alue. Te rapdeas s crcal ad, accordgly, exsg deas becoquckly. Greaer oleme of ousders he prollusraed by ope source sofware, mus become h

keers ad corporae sraegss. Ts s he messagRamaswamy coey her book Te Future of Comp

I her ew, oe of he mos mpora reasos o process o cusomers s he eormous burde plaof maagers o creae alue. I s becomg creasglahead of he compeo or o hold oo a srogly coposo. I CIO Magazine, he wo professors makecusomers work amed a creag more alue.

Its time to loop customers into the act.

C.K. Prahalad and Venkatram Ramaswamy, 20047

How do you work a way ha keeps cusomers eges? Ad s hs really ayhg ew? We ceraly clarge compaes (e.g. Phlps) gore cusomer feedbacproduc updaes. For sure, s o as f Phlps ad cosumer expereces he pas O he corary


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creased sales oer he las fie years haks o beerbes pracce queso, from ope source sofware d

he experse ad experece of users s explcly csofware deelopers hae always bee users hemselremas he case. Now he lead-user approach s shfas a cosequece of Vo Hppels sgh, whch s rodeelopme.

Te ope source sofware moeme deeloped frsrog user-led form of ope oao o a full-

olg large sofware deelopme orgazaos aaed compaes. Ope oao s mog he opopeess was aed by srog parershps amkowledge sues, whch was he followed by colusers. Expecaos are ha he relaoshp beweepaes s gog o deelop furher. Compaes wouldhe relaoshp, bu hey wll also lkely ecouer

o he form of commues ad ew busesses

Wide Open

Jus as compaes ca o loger do whou he eew sraeges, collaborao wh commues wll he fuure. Ts s he cocluso of Demos, a promeUK, s Wide Open repor.8 Te repor has a reesource methods and their future potential.

I md-March 2006, Ncholas Doofro, IBMs ede of oao ad echology, ppoed helaborao arous areas by obserg ha all h

eres had already bee made, he preous cemore dffi cul o come up wh somehg ew; does come alog so readly. Cosequely, Doage as oe of oao based o collaborao busess models ad culure:


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2.3 Have others do the work

Te ce hg abou mae user oleme s coer cosumer expereces o mproed producmerly, compaes had o use markeg repors ad parmeal cusomer coacs o do hs; ow s as g her ow soluos drecly. Te laguage hey udgal, as mapulao sofware forms a mpora

Erc o Hppel, addo o beg a professor a

Lead User Cocep, s also he head of he Ioaoshp Group a he MI Sloa School of Maageme. Huser-dre oao bu also wh he democraprocesses so ha eeryoe ca parcpae. For moreceury, Vo Hppel has coduced research o userbu he dgalzao of socey rece years has eres hs research. Vo Hppel ee defies gr

sofware ools, especally he CAD/CAM doma,a reaso why oao he fuure wll be abledeas.

Te oo ha user parcpao ca be useful sgoes back o a me log before sofware ad oher esed. I fac, Plao wroe Te Republic (loosely ras precsely seasoed users who hae he mos expebeer oled produco:

Automatically, we think that the carpenter certainly knows

or a table. But is it not so that, in the case of a horse only the

determine what is the best bit or bridle. It is clearly obvious

have the most experience. Users have to tell makers what th

this way, they can be served according to their whims.Plato, Te Republic, 360 BC

Sudes rece years reeal ha he relaoshp b


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Open source lessons for innovation

I was ul 1999 ha people were see sadg ohrough he breakers. Ye he ke-surfig marke hasha US$100 mllo. A group of ke surfers who wergoods aalable sores bega o make beer produche ere, her former se www.zeropresge.orwhch sll ca be foud a www.m.edu/people/robhml), ad modelg sofware cosg US$195 (www

bega o deelop kes for hemseles. A firs, hescompleely maufacured by he group, bu hey soowhere her dgal desgs could be ploed hroughoao cycle became a sreamled sysem ad, soo moe from desg o ke wh a week. Ter haks o smple I. Te group was sasfied becausebeer produc ha was ee cheaper ha a ke

aos were made aalable o her webse, as heyup a commercal compay: clearly a example of opewere publshed uder a creae commos lcese. Tope source lcese for creae work oher ha sWhe hey were coaced by a cleer busessma whe kes o marke, he group dd o hae ay objechad chose hs ype of lcese. Howeer, exsg sudaely cofroed wh aoher formdable compeohad o spe ay moey o R&D bu could sll offea lower prce. For hs compay, o eed here pg.

ranslating user experience into innovation

Vo Hppel speaks of oao ches whch usa mpora role. User expereces ca prode suggmes ad somemes s he users hemseles who

b k h l d l d


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expereces back o he orgal produc. Te closedlaboraory ad he ope user erome whcplace ca be exremely complemeary.

2.4 Product innovation in the age of coding

I he ype of ope oao ha leads o he prodobjec, collaborae effor o he dgal desg s fu

o he CAD/CAM echology of Rho, he ke surfable o coer desgs o agble producs. Ts lfrom dgal desg o physcal ed produc wll be fuhs seco. We wll beg by cosderg geecs research, areas whch he relao bewee prograo s becomg creasgly more profoud. Nex, wo smulao ad hardware rualzao. Te, af

g o he dsa fuure of ope source he aerospcoclude wh a dscusso of he Dgal DesgeLego.

Open innovation is growing

Tere are wo ceral deelopmes ha make psely more oao o occur ousde of orgazaoles a creasgly hgher degree of auomao. y of produco ad producs become rual, he eo ake par. Te secod deelopme has o do whadapg he echology. Because he echology s

se ad cosequely more accessble, he umber of ope oao s o he rse.

Open source collaboration in genetics and pharmace

D Bi [ ] d d h O P i i


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Dr Ewan Birney [...] was awarded the 2005 Overton Prize in

advocacy of open source bioinformatics, and his generous co

BioPerl community. Perhaps even more important to biolog

the Ensemble genome annotation project [...]. Dr Birney [...]

the Ensemble project to the open source development mod

Sephe Maurer, a law sude a he Goldma SacPolcy a he Uersy of Calfora, made a appea

boechology coferece Sa Fracsco for he apsource approach o he deelopme of medces eases. Te webse of he ropcal Dsease Iae (dsease.org., prodes a meas for chemss ad bologer. Te echology has ow progressed o such a po he greaer par of he work o be doe whou werual work ca be coduced, for he mos par, a

er because he adaced dgal ools make hs polusraes how he worlds of bology ad compug aad how hs s leadg o he produco of medceces.

For sace, collece research beg doe oropcal dseases such as schsosomass s posed o Wh regard o schsosomass, research s beg cohe drug Prazquael. Ts ope source bomedcal sg a umber of ery specfic dseases o whch he phry ges lle prory. Te ropcal Dsease Iabrg abou he deelopme ad produco of medcal llesses. Kowledge of bology, chemsry abrough ogeher a ere commuy of ue

scess ad sues. Te rual formao me (compug) he research plays a key role he oluary corbuo of researchers, rual phablshed. Tese are o-profi eure capal orgahe deelopme of promsg medces for he ro

l b h d h


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commercal success because hey are used he redseases, for example.

Leads

Computing

TDI Target discovery Lead discovery

Lead optimization

Databases

genome

sequences

Chemistry

Syntheticchemistry

Databases

protein

structures

Virtual

ligand

libraries

Compoundlibraries

High-throughput

screening

Biology

Protein

production

Protein

engineering

Substrate

specificity

studies

PubMed

(journals)

Other

databases

Structural

biology

Target

validation

Protein-

ligand

docking

Functional

annotation

Sequence

similarity

searches

Protein

structure

modeling

Literature

searches

heed Mar Mael Nssa Norhrop Grumma S


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heed Mar, Mael, Nssa, Norhrop-Grumma, SAr Force, he US Army, he US Nay, Volkswage adsae-of-he-ar rual es lab of Vruech, whch wecs as he Irdum Saelle, fires he magao

Eliminating virtual deficiencies saves a great deal of t

Example: Factory simulation using Flexsim

Facory smulao ca faclae beer maageme Tere are a umber of ways ha cosly produco mragg from mproper allocao of huma resourcesples of maerals. Varous compoes mus also wh each oher a he rgh me. Boleecks ca beg oo far ahead of he oher. All producers ry o away of dog hs s by usg smulaos o prode

eraos of a ge facory ad poeally mproe pkowledge of he produco specficaos eables bhe relea compoes order o aod problems.

Example: Te virtual Virtutech test lab

Nowadays, compaes are beg cofroed by creacoss of esg. Ts demads oae soluos. Ohs problem oles full-sysem smulao usg hs uderake que early he deelopmeal prologcal breakhroughs ow make possble for ruaa sofware model ha ca smulae a complee syseualzao s so accurae ha s o oly able o precly o he ed produc bu ca coec o ohe

o work ogeher.13

Example: Iridium simulates aerospace software with Simic

Smcs has bee deeloped o make possble for sofprogram rual hardware so accuraely ha he sof

had he queso recogzes he possbles of ope


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had, he queso recogzes he possbles of opead, o he oher, exposes s lmaos. Charles wh hs ssue. He was a lawyer ad a law professor.as he head of he Global Commucao Secor a hess Value. Now he operaes ou of Gerlach Space Syshe fouder. Gerlachs deas are raher uorhodox. a program off he groud ha s amed a he explocludg mg such meals as plaum o earbycoced ha ope source produco ca help hm

ope-source ambos sere as a mrror for he arcrdusry, a hgh-cos ad effi ce secor whch barelyaalable worldwde.

I coss los of moey o buld a arcraf, ad commuy s o gog o lay dow he cash ad rsuch a sadpo, he ope source produco of ahypohecal. Bu ddg arcraf produco o

ual (desgg ad esg) compoe makes a csory. A parallel could be draw wh he ke surmaely, he marke leader was surprsed by a beer ppeor who had o doe ay of s ow R&D busource desg.

IBuilding an Open Source Space Program,15 Gerlachad obsacles o he applcao of ope source awhch, Gerlachs ew, has falle behd adopcples. Te supposed lag has bee caused by he hechologcally dre, herarchcally corolled produsource demads a radcal shf. Wha Gerlach depcshe legacy problems large sofware sysems. We k

jus become group sourced. If we wa o had a p

rbued commuy, we would firs hae o dde upageable peces, so ha corbuors ca each work oher experse.

Howeer he qualy of sofware ools has creased e


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Howeer, he qualy of sofware ools has creased eyears, ad he ope source desg of a arcraf s ow arms reach. Esseally, we ca desg ad es culy ad whou exra esme.

Charles Gerlach mages hs dream realzed by ope source produco ad radoal supplers. Ihe ke surfig example, bu wh he dfferece ha producs becomes purely he work of compuers. NASo sed he Mars Pahfider o s msso wh ope

crcal sysems. Perhaps hs wll smooh he way fohe applcao of more ope source prcples a sphe oe esaged by Gerlach.

Lego uses Digital Designer to open up its innovation

Lego has bee mplemeg aes o hrow opecedures sce 1999, bu 2003 was a breakhrough yeTa s whe Lego came ou wh Facory, a ereha 3,000 sors hae made housads of Lego desbes, whch he ur up o sore sheles alog whsger o he back of he box. Mark Hase of Legoabou maufacurg producs hs way:

Te ideas of what you can do with this is endless. Its just th

[....] Lego isnt special. Any company out there can do somet

Mark Hansen, Lego

Lego Dgal Desger s he sofware for buldg wses he key o he ope-oao success of he produc for 3D desgs ca be dowloaded from he dre as youg as see ca parcpae. Each desg ad ca he be ordered ole Te desg sofware


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Figure 2.2: Open innovation at Lego thanks to usable design software

Obously, he drec access o cusomers s mporafeedback for he compays ow maufacured proderesg for Lego, as ormally coac oly occurs of he ulmae arge group, chldre. Recommedao oher cosumers hae a reforcg effec. Ad fiahe commuy ca be added o he -house creacosumers make her ow desgs bu may also collow desgers.

People parcpae uder he codo ha her dal. I mus o represe ay perso or a produc ofpeors. Oce Lego Facory has screeed he desg

posed he produc gallery, alog wh a quay ohe maker such as ckame, age, coury of resdesg, ad a descrpo. Each submsso auomacakowledge. Commucao wh he Lego commuways cludg hrough a message board o he Fac

Ts ew form of commucao has opeed may e


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p yrao ad co-creao hae become permae elemBased o expereces wh he commuy, Lego hassos for ope oao.

en open innovation lessons from Lego

Udersad how alue s perceed.Ierac frequely, opely ad hoesly.Kow yourself, ad ow up o msakes.

Ecourage coersaos bewee cusomers.Seek ou he rgh persos ad ask hem o parcpaFormalze wha ca be formalzed.Parcpae: you ge back wha you pu .Do maage he commuy bu spre .Do sell bu show passo ad share passo.Is OK o say I do kow.

Ts ls clearly demosraes ha he sor of jomeas ha Lego people mus o place hemseles abNo sales pches, ohg really o maage, jus be opparcpae whou ay preesos he commuo be leared.

2.5 Open innovation is something typical of our ge

Chldre as youg as see are workg wh he CADHow log wll be before hey beg o parcpae o programs? Icreasgly more people are becom

ad more adep usg he compuer. Tey make opwork wh CAD/CAM ad/or commucae wh comere usg pla laguage.

You mus be que sklled order o ake par debu a ke surfig desg s o easy eher Te mor

..

.

..

..

...

Te redwach agecy oules a umber of chara


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g ygeerao:

Generation Content...

is creative; creativity is the path to content. We are all creati

also permissible; parents are no longer concerned to limit th

of their children, as it is now evident that such careers have

Generation C wants to be the master of their own destiny,

idea that they are in control and not governed by others. T

and honored; they want to be famous.

Te musc edor MF makes opmal use of he Gehag s ewers co-buld persoal profiles o hmeda are also seg ewers ad lseers o workzine, a ole magaze ha s fully produced by

sed phoos ake wh her cell phoes o Starzinepear her ow magaze. Sap, Sed, She. away.

Bu ee old-school broadcasers lke KRO (he CaSao he Neherlads) hae ow dscoered haece creay. Wh buld your ow alar KRO hbewee her esablshed dey ad egagg he

creae for hemseles.Geerao C s ace o ere blogs. A www.lu

ple are able o realze he Starzine credo: fame s juole publsher offers he publc he opporuy o pere ad o pr hem ay desred forma adEe he prce ca be se by he cusomer. Noably, J

sold more ha 100,000 copes of her book, ad 20Lulu Blooker prze, he prze for he bes blog book.umbers more ha 40,000 books ad grows by 10 pI s o cocdece ha he fouder ad boss of Lulu er of he Red Ha ope source compay

Treadless -shirts


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W fame, freds & $500 cash & przes s he ea ole--shr desg compeo. Ayoe caparhs or her ow -shr desg. Te Treadless commuer oce a week. Te shr s pred ad ca be ordemaufacurer ha makes cleer use of Geerao Cbee 30,000 submssos o dae ad 1,500 more are

Figure 2.4: Become famous, design a -shirt (www.threadless.com)

Treadless has ow bul up a colleco of wo hu

shrs.

Te open source shoes of John Fluevog


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Figure 2.5: Purchase open source shoes or design them yourself

Te example of ope source foowear mgh seem som he leas because of he way whch Flueog presWh humor ad equocao ouchg o roy, he o ake par. H-ech equpme s o ecessary; a scmgh be eough. Joh Flueog regularly goes hroug

sos whe he s lookg for ew desgs. Afer whree hudred serous submssos hae come ahae bee seleced (ad amed), such as he Aasas by a woma Russa.

Despe he somemes comcal characer of hese eof such deelopmes should o be uderesmaed.

c mporace of Geerao C was emphaszed 200ard Florda hs book Te Rise of the Creative Classduals s he curre red, ad compaes able osources of creay are cleerly explog hem o

Te ere coe-creag geerao s aural


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Figure 2.6: Te difference between the amateur and the pro: the pros

2.6 Webservices: light-weight software for business

Oe facor accelerag he deelopme of opeemergece of webserces. Wh a webserce (a moware), a ge self-deeloped serce ca smply be

ces. Coersely, he webserces of ohers ca bces you prode. Webserces offer arous oposoao:obag exeral kowledge usg ew serces dea sor of Lego block o be added o your ow sercesallowg ousde people o parcpae he deelopm

for your ow orgazao he same way ha psource sofware;allowg ohers from ousde your ow orgazao up her ow deeloped serces, producg ew oque ad drec sp-offs of he orgal

We no longer have to do much to produce new business a

[Bill G d R O i ] h h l h f li


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[Bill Gates and Ray Ozzie warn] that the latest phase of onli

[is] likely to be very disruptive to the industrys established

next generation of the internet is being shaped by its grassropopularization model [...]

remendous software-and-services activity is occurring wit

the grassroots level [...]

o those who are in the midst of it, it amounts to an entire

producing and delivering software [...]

Te Web 2.0 crowd has discovered how to create internet smarket appeal on a shoestring. Te watchwords of this appr

possible, develop lightweight software from standard techn

blocks that can be released quickly over the web, then learn

of early users to refine the service [...]

With Web 2.0 you can be talking about just a couple of eng

something interesting and compelling.

Financial imes, 17 November 2005, p. 1519

We are creasgly able o budle he approprae soogeher order o buld powerful ad compellg swfly. Te webserce approaches of Amazo ad larly good examples of hs pracce. Accordgly, he

made he followg predcos abou deelopme2006. Fe ceral gredes are brough ogeher rupo, ope oao, ope source, commuesere (he Google effec or Web 2.0).20 As IDC pus

IDC on the I sector in

We observe a critically new ingredient and that is the accele

business models opening innovation in I products and

(the open source effect) and the online delivery of I in the f

Google effect).

Te I-go-forward-completely-on-my-own model of innova

he same me. Te ope source effec s relaed by IDad IDC asuely remarks ha compaes whou co


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ad IDC asuely remarks ha compaes whou cog breed.

Webservices compete with open source developers

Te ope oao sraegy of eBay s, o a sgficawh commuy oleme he buldg of eBa

appeals o ddual deelopers ad herefore cosource projecs. Jeffrey McMaus, who was resposbprogram a eBay ul Aprl 2005, explas o hs webprehese abou a forum dscusso orgazedORelly.21 Te dscusso was o be abou he hreposed o he ope source commuy. I s rue haeBay are less free ad ope ha ope source sofw

deeloper ca apply he fucoaly a way smlarsofware s used. Te bg dfferece oles he codwebserces may be used. Isead of he crcal quesad freedom of hs webserces ha McMaus had elely dscusso ook place cocerg he possblead parcpag.

Edely, deelopers sll hae a log way o go e

I Chaper 4, we wll dele more deeply o wha mohese commues.

2.7 Open innovation at Amazon, Google and eBay

Te ere cos Google, Yahoo, Amazo ad eBay hway o corporae ope oao. Orgazaos make use of he search eges, websore ad he wofor her ow purposes. We I are accusomed o spbu hs coex he alk s abou mash-ups T

mokey, a program for mash ups. I s used, for examwebse o dsplay he prces of compeors as show


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webse o dsplay he prces of compeors, as show

Figure 2.7: Competitor prices on the Amazon site as a result of a mas

I hs way, formao ca be mxed ad ew serre-use. Te oable hg s ha hs pcure makes were prodg he formao self. Ts s how w

Greasemonkey lets you mash-up websites. It lets you exten

and integrate that script right into the original site as if the d

intended it to be there. It lets you use their web site, their dawork to serve your purpose and function. Tere will soon be

enhancing every site you use. Whether that site likes it or no

NIVI blog, 200524

I md-2005, Google released he equpme eededbased o he map formao of Google Maps. A lor Yahoo made s ow maps freely aalable. Te o

Applcao Program Ierfaces (APIs) formalzed whpeg as may deelopers were makg use of h


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Figure 2.8: How safe is it there? A mix of information programmed by

Behd he opeess of eBay, Amazo, Yahoo ad Gooao s smulag. Rp-ad-mx fucos o eology of hese compaes spreads uchecked all oresul s ha a subsaal par of Amazos sales commash-up se. Esmaes dcae ha aroud e ml

ceed oer Amazo webserces eery day.25 Mash-uo he compay oao ad markeg whouo he compay. Paul Lee, geeral maager of Yahg abou mash-ups:

Its essentially research and development and marketing for

Paul Levine, 200523

I makes use of deelopers who are o o your payrohe work bu also ake care of promog Te bus

Amazons Mechanical urk


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Amazos Mechacal urk s a humorous example of o

so fuy precsely because showcases oao sof how o ge all he brgh mds hroughou he woTs example ad he followg (NASAs Clckworksces ca be used o ousource sadard work o peozao.

I Noember 2005, Amazo aouced a surprs

o olg a uerly smple ask: selecg a goodabou sx comparable mages. Tere are compaes whphoographg eery buldg o eery sree a chousads of phoos made each day, a seleco muha prode he bes mages of he buldg. Ts alabor ese. Te ere prodes a way ou, as sourced o ayoe who s wllg o do .

Te specal feaure of hs applcao s ha ayopad. A few ces for each seleco. Whoeer worksca easly ear a few dollars a hour. Te moey s cr

Amazo accou ad, f ecessary, rasferred o a perAmazo ames hs serce arfical arfical ellc referece o he arfical ellgece ha were faof compuers mag huma ellgece, a web a

he ellgece of housads of people.

Figure 2.9: Amazons artificial artificial intelligence

Amazo calls hs, appropraely, s Mechacal uo a apparaus ha Wolfgag o Kempele deelochess mache ha could bea eeryoe ad looked l

preously bee he work of hghly pad scess. Ths ca ow be performed by ayoe who was o c


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b p by y hs s moooous work ha, accordace wh he p

mechacal urk, has bee ured oer o a large grou

Figure 2.10: Clickworks: NASAs Mechanical urk

2.8 Open innovation at oyota

I Aprl 2006, BusinessWeek publshed a large-scale saoal compaes.27 Te sudy examed he ozaos ad raked he worlds op mos oaplaced fourh. Tey eared hs rakg o oly dueproduc, he hybrd car, bu also because of her procoa s defied as a maser of maufacurg o

oyoa s esely cocered wh maxmzg hsde s ow compay walls Prcples of self-dee

he success hs case has sregheed oyoas orgazaoal prcple acually fucos well, ad h


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g p p y ,cofidece applyg erally.

oyoa ow makes use of a umber of ope source cples. I he produco les, where employees ejself-maageme, ad a crss suao, oyoa haope source ype of produco ca be exremely effe

Phlp Eas ad Bob Wolfe of he Boso Cosuldfferece bewee how Lux was creaed ad he moa operaes. Te lesso ha oyoa leared afer heured hs compay o a hybrd orgazao wself-maageme feaures ad op-dow maagemmakes oyoa oe of he firs dusral compaes derlyg he ew ecoomc order he I secor o produco.

Te crisis

O February 1, 1997, fire broke ou he facory of sWh a few hours, early all he maches ad flames. As Seka maufacures car pars, he so-corol he supply of brake flud. Bu ee more mp

99 perce of oyoas P-ales. Whe he fire broke oproblem for oyoa. Because of s jus--me supquckly ra ou of pars ad car produco groud o

I a rescue-oyoa-from-he-fire operao, waSekas desgs for car pars would be ge o ay suphem. Supplers would also be proded wh all he kowledge ( bref, he complee source code), cluof produco equpme salaged from he fire. Pro more ha sxy locaos; parcpas he rescufrom oyoas ow facory o supplers from ousdsewg-mache maufacurer Afer hree days a

O February 3rd, produco had bee compleely hlaer was aga up ad rug.


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g p g

Figure 2.11: Production back in operation as a result of an open source

Eas ad Wolfe make he comparso wh a serouo a Lux serer Ialy December 2003. A he Ua aack o a Lux serer serously damaged pargrammg ad caused a secod problem he file ex

Te Iala sysem maager called Amerca ad Aushe ope source commuy. Wh a few hours, hea day laer a pach was ready o be se hroughou user commuy. A few days laer, he sysem maagrace he hacker. wey people parcpaed he eafer a successful cocluso, eeryoe was haked aame. Ts case oled he same characersc maha had occurred he oyoa crss.

Lower transaction costs

Fri

31-197

0

4000

8000

12 000

16 000

Sat Sun Mon Wed

Units

pad for wha hey do. Sll, oyoa presely allows mo ha oher maufacurg compaes. oyoa


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me does o focus o persoal goals. Compay pr

are alued hghly. Employees are ge he laude oproduco le whe hey hae deas abou mproealzes o he experse ad he rsc moaoSmlar o he ways whch ope source projecs usesers ad e-mal, oyoa prefers o make work-floor oas possble. ape marks o he floor dcae he mes, ad produco ca be followed o moorshe formao: he head of produco Caada khe hches are Japa.

Te Boso Cosulg Group adses compaes wope source echques o buld hrg huma ehs requres smple echology. Keep smple ad ophe bass of good collaborao. Te adaage of ch

dard echology s ha creaes smple semacs aI addo, he work mus be as raspare as posgood reaso for hoardg formao, he releasefiler her ow formao ad exrac wha hehkg helps, because squares wh Busess Proca heme ha has bee resoudg hrough compacade of he preous ceury. Modular hkg ad w

grede ope source projecs. Ad eamwork sgrede: reward he group, ad he group wll rewhe successes of a eam ad dsmale ddual peTere are four gredes of successful huma ewChoose smple echology as your sadard.Make work raspare.Tk modularly.Ecourage eamwork.

2 9 Open innovation at Procter & Gamble

..

..

Jeffrey Weedma, ce-presde of exeral busProcer & Gamble. Now, he says, We eed o be eryb h l b d d f


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brgg echologes, busesses, ad producs fr

Te o-eed-here sydrome has bee allowead ow ope oao has become a par of comcreasgly more dffi cul for Procer & Gamble o gdeas o keep he ege of a large compay ruCEO a he me, Durk Jager, gae eormous mpeuow eral oao. Ts appeared o be he sbecame clear ha dog hs durg a re-orgazamuch. I 2000, Ala Lafley ook up he bao ad mmhe goal of hag half of fuure oao come froGamble. Accordg o he compays ow esmaes,lo scess from all oer he world possessed expa o Procer & Gamble. I seg he ew course,ellecual propery came uder scruy. Preously

had oly raded ellecual propery wh whch cself; ow lceses were beg ssued regardg all pafer Procer & Gamble has brough a produc o mafer has bee graed a pae, ay oher pary caha produc. Ts ges Procer & Gamble he leadmarke ad, a he same me, geeraes oaome as well as lcesg reeue. Addoally, he

compels oher compaes o compee wh Procer &ha he pae s gog o come o he marke, you wce abou deelopg somehg smlar.

2.10Open innovation in seeker-solver networks

I he hu for kowledge ousde of he orgazaoad such compaes as El Llly make eager use of koas Iocee ad NeSgma. Tese compaes preo eworks ad acqure ew deas ad soluos from


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Figure 2.12: Scientists help companies and gain an opportunity to win

Research o he ecoomc mpac of Iocee aly worhwhle o oae hs maer. From

US$400,000, come ad sags hae amoued o mlo.A smlar commuy wh whch Procer & Gam

allace s he oe deeloped by NeSgma. Here, ers coss of orgazaos raher ha persos. Vof Calfora, Dow, Arhur D. Lle ad Semes bCles of NeSgma clude Procer & Gamble,

Uleer.

Oher compaes, such as Boeg, hae also become ess model of YourEcore s dffere from hose of

k Af h k h l


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works. Afer a machmakg process, he employees

porary bass. A bous of 20 perce of he rered perher fial year a work goes o he ework orgazaoassgme, employees sg a corac ha all ellogs o he orgazao for whch heyre gog o me s o as casual as a ope source projec (alprogrammers are, for ha maer, also regularly emcompaes). Howeer, s ceraly a arace operesed offerg her ow labs o prode a secompeos op researchers.

2.11 Open innovation in the press

Producg a ewspaper collecely has become serouSouh Korea OhmyNews was lauched February eresg ha s rapdly growg readershp s he rhas played he rece elecos. Te cory of Press largely arbuable o he effors of hs ope soupresde hmself was he firs o ackowledge hs faory, haked he may olueers workg hs

Whe a arcle s posed he ole ewspapera modes fee: a 750-word pece ge he headg oEdely, a OhmyNews correspode s o prmamoey. All arcles are mmedaely publshed, bu hpaper cosss of arcles from he ewspapers ow psupplemeed by eed arcles from he commuy

A hs me, OhmyNews umbers aroud 38,000 cs read daly by a mllo people. A pred edo s pEglsh-laguage erso ofOhmyNews32 has also beeorgally wh hree hudred correspodes, a umgrow o e housad wh he firs year (2006) Ed


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Figure 2.14: OhmyNews, the newspaper that helped the new president

OhmyNews ears moey, bu ha s o he mos cordg o Oh. I hae o make moey, he says, bua ha. Deep my hear, I am sll a reporer.34 Ihe ewspaper remas rue o s deals. Te majo

comes from adersemes, ad 20 perce comes fo oher ews ses. Eargs from adersers mucome oo large.35 Oher come sources wll hae ocludg oluary corbuos from readers o rarcle, whch s a cocep ha we saw earler whdesgs.

2.12 Open innovation in advertising and marketing

Adersg ad markeg are wo addoal are

Adersg ageces use erms such as ral markeg, ad word-of-mouh adersg for camparadoal meda bu are dreced oward peer-o-pee


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radoal meda bu are dreced oward peer-o-pee

ers ad cosumers play a mpora role hs by, g adersemes or by commucag cusomeresul, cocg ohers. James Cherkoff, a cosulamarkeg, has made a sghful examao of whs ope source mafeso, he makes egh recommezg markeg ad adersg:36Ge cusomers drec access o her ow brad souer hem o collaborag producers, jus as Luxaccess o he source code.Spur he fas o ad hae hem o do he majory ofBe a brad hos.Lse o wha he commuy has o say. Ope sourchearg all he rumblgs he marke mmedaely

Ge real. Auhecy s oe of he mos mpora pare world.Accep he fac ha your cusomers are cleerer haLe go. ur owershp of your brad oer o he peoBe ope mded abou hese ew deelopmes.

Involving people in commercials

Aud, Nke, Mercedes, Geeral Moors ad may ohole her cusomers he creao of her commercpar of he corol oer her corporae commucmeas oleme. A commercal from Aud whallowed o ake corol, skech her ow plo ad echaracer he sory araced half a mllo parcpad deos were dsrbued o arous ses, such asTe parcpas could subm her ow fidgs, ases ad blogs Te campag was a grea success I

.

.

..

.

.

..

a real commercal bu, a he same me, a subsaeur. Addoally, here was a grea commoo abou produced a lo of buzz


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produced a lo of buzz.

Figure 2.15: Amateur videos for Express Yourself at Converse39

Geeral Moors dd he same. GM asked cosumers cal, whch produced 2,600 submssos as well as hraffi c o her webse.

I he Neherlads, cosumers suppled he scrpme for Ceraal Beheer, a surace compay. Uyour ow Gouden Loeki, he Duch eleso prze foraal Beheer lauched a appeal ad receed egh commercal. Amserdam resde Fras a Gerwe wwas, fac, submed for a real Gouden Loeki, bu wof he przes 40

Fouder Dae Baler has paeed hs BzzAge syword-of-mouh adersg off he groud. Compaor fluece wha cusomers hk ad say abou he


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or fluece wha cusomers hk ad say abou he

o BzzAge. Buzz ages are he seleced o helog o he arge groups ad ca be eagelss foamous o a furher meamorphoss of user-dre o Hppel proposes Democratizing Innovation. Te of-mouh campag, bu ca also sere as a feedbcusomer resposes or as he bass of a ormal ad c

Oe of he specal projecs whch BzzAge wapromoo of Creae Commos, a ope source lcead musc. Howeer, BzzAge also works for ordabeer, books ad corflakes. Orgazaos lke PeguBusch, DuPo, Su Mcrosysems, Nesl ad IBM serces ad prase her qualy.

Figure 2.16: Whoever wants to approach a community can call on Bzz

Jones Soda

Joes Soda, a sof-drk producer wh US$27 mlloomers desg he appearace of he boles. Ayoos, ad, o he bass of a oe held o he se, chose. You mgh see your ow acao sapsho

drk or fid o supermarke sheles hroughouphoos hae bee used, so s dffi cul o sed eerow bole. I s easer, especally for Joes, o haeyour boles o www myjoes com for US$48 95

are ohg specal. Oly a few gredes are olmal. Howeer, Brewopa has doe more o capalzope source. Tey hae uleashed he dea o he who


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p y

oly s he beer ope source, he ere maagemes based o a umber of ope source prcples. Wheres a maer of cojecure, alhough Lam Mulhall, fBrewopa, worked for years a Red Ha, a successful ocompay.

He, alog wh a umber of freds, came up wha brewery, bu oe ha would always prese all decy. Wha orgally bega as a group of freds ado a global commuy of aroud hry housad bosseurs. Wh he ere as s mos mporaaed whch he commuy made, oe afer asary decsos. Te ace members were rewarded fowh cerficaes ha would ele hem o shares

appled for sock marke regsrao. Te commuyrole fiacg he compay, deelopg he producbrad. Afer a perod of deelopme, he compay acad sell beer for he Ausrala marke. I keepgope source, a share cerficae s ge away whsold.

Brewopa beer s a absoluely commoplace, up

Just beer to get drunk on

No crap, no fancy crap about imported hops, first crop ba

blokes hard at it in the coalmines. Its beer. You get drunk, fa

and mozy on out of town.

Brewtopia

Te parade of Brewopas oaos has coued lauch. For example, hey make possble for a cuscase of beer accordg o persoal specficaos ad

Brewopa spres cofidece by mmedaely offergwho s o sasfied. Te oly codo s ha he dmus expla why he beer was foud wag. Of


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p y g

more pose cusomer expereces s also alued.

Figure 2.17: Grab your chance while you can and become a brewery ow

o furher crease brad rus, Brewopas prcg sTe more beer ha s sold, he more cheaply ca be

cheaper he produco coss, he lower he real prcedcaes ha a case of beer orgally cos Aus$49.47.99, sll laer o 44.98, 42.88 ad, Augus 2006was as low as Aus$36.98. Te calculaos are madeprofi marg: 28 perce.

For skepcs who hk ha Brewopa s ohgadersg su, he compay has ssued he fo

Brewopa. Te oly beer compay Bul by he Peoplefouders acually eeded he esme of cosumepay ad hey are compleely coced ha he opoperag a compay s he bes here s Tey are prou

2.14 Open innovation at Boeing

Te Ope Source Space Program of Charles Gerlach,


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earler, s o ye a realy. I he meame, Boeg hg ousde kowledge o he buldg of ew arcrappeal for help o co-desg he ew Boeg 787 aques o s webse. Ayoe could jo he World Dfor he ew arplae. I oal, here are 120,000 rega erew from 2005, Klaus Brauer he projec dmembers of he WD are mosly cocered wh chumdy? Is here wreless ere oboard? Are cous eough? Wha are he blds he wdows lkread ha oher dscussos wh Jeff Hawk, he Do a Boeg, former Boeg egeers are olead pose crcal quesos abou he hydraulc syTe WD ae s eresg because uses

large group of professoal amaeurs or Pro-Amsame me, a perso jog he WD ad sg me mgh coclude ha srog markeg eressa grea deal of adersg for he ew plae, here asaers, bu here s lle opporuy for eracos also uclear f mos of he work s already doe aow merely beg haked for s serces. Ee he

arcraf, he 787 Dreamler, s a WD eo woeroes.

2.15 Open innovation in building new computers

I addo o he creay of he sofware deelop

commuy, Mcrosof calls o he resources of Geemaer. See Kaeko, Desg Drecor of McrosofIoao, fired he sarg psol for a ambouoher exeral creay Ayoe wh a dea ca p

ad Lfesyle, he creae geerao ca dulge scrosof wh a helpg had o geerae eresg


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Open source hardware

Ioao of a erely dffere order s behd hJoaha Schwarz, he COO of Su Mcrosysemshe UlraSPARC processor has bee ured oer o Jauary 2006 Ope Source Busess Coferece

Schwarz sad ha process desg would be performcese. Ts s he same ope source lcese uder waalable.

Open source is not just about software. Freedom is not just

going to come to hardware, and were going to drive that.

Jonathan Schwartz, COO Sun Microsystems

Wh hs moe, Su was o ecourage he ope somproe he sofware ad o wre beer applcaoHoweer, accordg o IDC, hs moe also makes pIda ad Cha o acqure kowledge o prae he

cloe he processor.42

2.16 Open innovation la CrowdSpirit


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Loel Dad worked for a compay ha eared bler-produc sales. Hs compay had dscoered ha aluable source of oao. Almos eery day he

call for ew deas. Bu he speed wh whch deaswas frusrag o hm. Te orgazao was bureauad Loel was eer ge a chace. So he lef. Noerepreeural spr has perssed for ceures o urured. Bu wha makes hs coemporary alerules of he game hae chaged. I has become smp

lo-dollar compaes wh ew oae producs.Loel se up CrowdSpr,43 whch he labels hecrowdsources elecroc producs. Te compay haParers for Produco. I cosss of a ework of dlaborae wh he ere crowd o make ew produ

You come up wh he produc; he crowds es adHouse sells , ad you share he profis. Te sepcashg- are preseed o he Cambra House se


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Crowdsourcing from ideas to production at Cambrian House

Te Chumby45 s a cocree example of a cosumerole aces smlar o hose of CrowdSpr aWha s a Chumby? Praccally speakg, s a clock r

coeco o he ere. All sors of hgs ca be ed o . I s somehg ha was made for hackg ahg dffere ad more arace ca also be made

2.17 Open innovation at Wikipedia

Te ope source Wkpeda ecyclopeda s oe of h


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eworks he world. Tere are more ha 350,000das: people who hae regsered wh Wkpeda formao. I May 2005, he hard core amoued dduals who had made a corbuo e or morearler, hs figure was uder 20,000. I olume, Wksurpassed he Ecyclopeda Braca. Halfway hrocoaed four mes as may words as s commerca

ake oly four years o reach hs mark, ad Wkpe sze eery year.

Figure 2 19: Wikipedia is compiled by a community of 350 000 volunte

ors. Howeer, hese rapd acos cao guaraee o he res of he pages s accurae.

Jus as wh ope source sofware deelopme, pe


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o es ha he formao s relable. Jokes are maof Wkpeda by, for example, comparg o a pubkow who was he las oe sg here. Such commcluded Wkpeda self uder he headg Why grea,47 alog wh a respose o he commeary. Tfrom laguage use, whch s a mshmash of all sors of

Ausrala, Brsh, ad raslaed Eglsh) o he m

proemes are made.

Wikipedia is about as good as a classic encyclopedia

Wkpeda has bee proe o be of good qualy. I

search publshed Nature esablshed ha he qroughly mached ha of he Ecyclopeda Bracfocused o he accuracy of he scefic arcles bTe aerage Wkpeda arcle coaed four errorBraca had a aerage of hree. Ee more mpoao ha boh ecyclopedas are plagued by a equerrors. I he ere res

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Open for Business - Open Source Inspired Innovation