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The Role of Open Innovation in

Value Creation and Value

Capturing

Kjell-Håkan Närfelt

Chief Strategy Officer, VINNOVA

Sweden

Slide 1

Slide 2

Some Words About

Myself and VINNOVA…

Slide 3

Slide 4

Äijävaara, 100 km north of the Arctic Circle

Slide 5

Slide 6

Slide 7

VINNOVA develops

Sweden’s innovation

capacity for

sustainable growth

VINNOVA is

Sweden’s

innovation agency

Slide 8

VINNOVA’s role

Connect, Catalyse & Stimulate

Slide 10

Sweden –

an Innovation Perspective

Sweden vs. Thailand

513 000 km2

64 million people

450 000 km2

9 million people

We have been successful in creating multinational companies

Swedish innovations

Swedish research

and innovation in figures

Slide 14

Innovation Union

Scoreboard 20104

Global Competitiveness

Index 2010/20114

1. Switzerland 1. Switzerland

2. Sweden 2. Sweden

3. Denmark 3. Singapore

4. Finland 4. USA

5. Germany 5. Germany

6. United Kingdom 6. Japan

7. Belgium 7. Finland

8. Austria 8. Netherlands

9. Netherlands 9. Danmark

10. Ireland 10. Canada

3.6% of GDP equivalent to annual

R&D investment in Sweden

Sources: 1SCB (forecast for 2009) 2VINNOVA 2010 3SCB (forecast for 2009) 4Innovation Union Scoreboard

2010, The Global Competitiveness Report 2010-2011

Equivalent to 3.6% of

Sweden’s GDP for

2009 invested in R&D.3

GDP

(billion

SEK)

112

Total Swedish

R&D1

29.5

Total

government

R&D2

2.1

VINNOVA’s

grants to R&I

Will high R&D spenditures

guarantee future success?

Slide 16

Foldit game leads to AIDS

research breakthrough

In a matter of 10 days,

gamers were able to do

what biochemists have

been trying to do

for a decade: decipher the

structure of a protein

called retroviral

protease, an enzyme that

is key to the way HIV

multiplies.

17

AstraZeneca cutting 2,200 R&D jobs,

slashing neuroscience in restructuring

"We've made an active choice to stay in

neuroscience though we will work very differently

to share cost, risk and reward with partners in

this especially challenging but important field of

medical research,".

"The creation of a virtual neuroscience iMed will

make us more agile scientifically and financially -

we will be able to collaborate flexibly with the

best scientific expertise, wherever it exists in

the world.“

Martin Mackay, AstraZeneca’s R&D chief

Press releases 2 Feb 2012

Slide 18

Why does old models of

innovation fail?

Knowledge monopolies are

broken Slide 19

Entreprenaurship – a new way of

living for many

Slide 20

Availability of capital for new ventures

Slide 21

Increasing external options for R&D

results

Slide 22

Cost and compexity of innovation

is increasing rapidly

Slide 23

Innovation - a new political approach to

solve societal challenges Slide 24

OECD Innovation Strategy

Slide 25

The Story of

Treehotel

26

Slide 27

Kent and Britta Lindvall

The Tree Lover

28

a movie by Jonas Selberg Augustsén

29

It is not only about developing new products and services

”New value creation, not new creations”

Innovation?

The Innovation Challenges?

We need a broader view on

innovation

Based on Innovation Radar

WHAT?

HOW?

WHERE? WHO?

Offering

Innovations

Customer

Innovations

Operational

Innovations

Eco-system

Innovations

Traditional

value creation

New areas for

value creation

We need to improve our

Innovation Management skills

Slide 33

Innovation-

strategy

Innovation-

processes

Organisation

& Leadership

& Culture

The Management Challenge?

34

Innovation-

strategy

Innovation-

processes

Organisation

Leadership

& Culture

Operational

strategy

Day-to-day

Operations

Execute! Search & Learn!

Production of Goods and Services Value creation which delights customers

Effective Innovation requires collaboration and

co-creation between customers and suppliers!

We need to strengthen innovation driven

collaboration across disciplines, sectors

and organizational boundaries

We need to stimulate demand and use of innovations. It is essential for national growth!

Focus on innovation procurement!

SBRI, UK - Handhygiene

37

The ability to import and apply externally developed knowledge and technology is key to innovation driven growth!

We need to balance the production of

knowledge and technology with the

import of it!

Slide 39

What has Open Innovation

to do with all this?!

Slide 40

Open Innovation is about value

creation and value capturing

using collaboration and co-

creation with external partners

Open Innovation – a strategic

view

The use of

external talent, ideas, assets, inventions and innovations in renewing your and your partner’s businesses

internal assets in business collaborations with external partners which diversifies your business to new markets and new fields of value creation

Slide 41

Challenge driven

competitions and

procurement

processes

What Can Governments Do?

44

Establish

innovation

infrastructures

supporting Open

Innovation

Open up IP and

data to

innovators and

entreprenaurs

Triple helix-based nodes in regional

innovation system

43 Business Incubators, 33 Science

Parks

Focus on processes,

commercialization and renewal of

businesses

5000 growth companies with 72000

knowledge workers

Swedish Incubators & Science Parks

Aspects of Open innovation in Swedish Science Parks

Challenges to

network

Utilizing the

“crowd”

Utilizing their

network

Challenges looking

for a solution

Research looking

for an application Ideas for

comerzialisation

Public idea

contests

Open

Ideabanks

Open innovation at Ideon Science Park

Facts about

Ideon Science Park

• Est 1983

• 300 companies

• Regional network node

Focus areas:

• ICT

• Life Science

• Cleantech

Challenges to network - case Inwido

Inwido – producer of doors and windows adressed challenges

to the Ideon network. Incremental and radical ideas

developed during the process!

Open innnovation at Norrköping Science Park

Facts about

Norrköping science Park

• Est 2001

• 100 companies

• Regional network

node

Focus areas:

• Visualization

• Printed Electronics

• Interactive services

Ideas for commersialization – case Virtual autopsy table

Virtual autopsy table combining ideas from front edge

research with ideas from clinical experience. Commersialized

by the company Sectra.

Process innovation: Virtual prototyping, Siemens Turbo Machinery

Co-creation: case Siemens

Some last guidelines…

Open Innovation is about openness - internally first

Open Innovation is about mutual trust and win-win

solutions

Open innovation is about sharing visions – like any

innovation process, start with the end

Open innovation is about co-creation – use

intermediaries if necessary to manage and facilitate

networking

Avoid legal, confidentiality and IP issues during ”court

time” – all events and initial contacts in the early

stages should take place in the ”public domain”

Slide 52

Thanks for Your Attention!