How ecosystems and communities foster innovation and create additional value

The High Tech Campus in Eindhoven houses more than 250 high tech companies that employ over 12,000 innovators who create the technologies and businesses of tomorrow. The presence of different companies makes it attractive for other businesses and investors too, because there is additional value in the network of potential partners and customers. 

This is impressive, but how do ecosystems and communities thrive and enable organizations to deliver top of the bill innovations? To dive into this topic, we discuss two organizations that are building ecosystems: the AI Innovation Center Brainport and Serendipity. 

What’s an ecosystem?
Ecosystem has become a buzz word in the business world recently, so it is worth starting with a definition. Gref Sarafin, E&Y sums it up: “A business ecosystem is a purposeful business arrangement between two or more entities (the members) to create and share in collective value for a common set of customers. Every business ecosystem has participants, and at least one member acts as the orchestrator of the participants.” 

Ecosystem orchestration
To unpack the definition above, we spoke to Kenny Koelman, who recently obtained his Master of Innovation Management at the Eindhoven University of Technology. He investigated how the AI Innovation Center Brainport (AIIC) could fulfill its purpose of stimulating the adoption of AI by companies in the Brainport region (read here the full report). There are multiple components within an ecosystem, but the orchestrator is the central actor according to Koelman. He claims, “The orchestrator is responsible for performing a set of deliberate, purposeful actions to initiate and manage this ecosystem to enable all the organizations and individuals that are part of it to create value for and capture value from the ecosystem.”

Koelman introduces an orchestrating framework with processes that provide the means for creating a balanced ecosystem. These processes can be divided into so-called enabling orchestration processes and primary orchestration processes. The former include agenda setting, attracting actors, mobilizing actors, and managing relationships. In other words, they refer to setting the right strategy, processes and people. The latter processes include knowledge mobility, innovation appropriability, and ecosystem stability. These refer to ongoing actions and outcomes that derive from the enabling processes. 

An important part of the framework is the relationship between these processes, and the key stakeholders and community, as shown on the image below. 

The final orchestration framework designed for the AIIC

Clarity and communication
A strong focus on stakeholders is fundamental to working in ecosystems, as Koelman points out. In general, this comes down to clear communications, explicit roles, and transparency. Making those roles explicit will help to further involve others. He goes on to say that transparency in the decision making process will increase trust with partners and stakeholders. After that, the main task is to set the agenda for the whole ecosystem and implement concrete action points. However, if you want to initiate an ecosystem, where should you begin?

Creating communities 
One way to start (innovation) is to create a dedicated community. A strong social unit with a high degree of connection between people provides the basis from which one can expand towards larger ecosystems with more diverse parties. The difference is that communities consist of members with a shared interest, like a common challenge or overlap in activities and interests. Ecosystems on the other hand, are characterized by the fact that its members have a diverse set of interests, activities, knowledge, resources, and incentives. One of the goals of the AIIC is to orchestrate the AI ecosystem in the Brainport region, so they have started by building a community of SMEs and start-ups at the Center. There are curently 13 companies established at the AI Innovation Center, they bring value to each other by exchanging knowledge and working collaboratively on projects.

AI Innovation Center Branport community event

Removing barriers
Diving more into depth into what such a community needs to thrive; transparency and open internal and external communication top the list. Through shared space and facilities, informal networking outside of your own organization has become part of everyone’s workday. This makes a significant contribution to the innovative capacity of the individual companies in the AIIC. Companies are able to complement each other and collaborate on projects. 

Serendipity, one of the companies at the AIIC, is removing barriers at the core of how they are building their ecosystem: a proposal for next generation solutions and digitisation for cities. They remove several barriers by standardizing the procurement process, ensuring interoperability of all tech solutions and making tech suppliers aware of EU legislation on digital technologies. Doing this only once with the onboarding process makes tech suppliers ready for all cities. 

Joint positioning
Through the Digital Twin, Serendipity is able to help the ecosystem by bringing on-board all key stakeholders. A Digital Twin is a digital representation of the physical urban environment and the processes in a city, which will allow municipalities to leverage data and AI for a reduction in emissions and costs, and improvement of liveability. It encompasses sensors, interfaces, Machine Learning and other analytics, and infrastructure like 5G and data exchange layers. By making collaborations work for two different kinds of organizations, the Digital Toolbox is acting like an ecosystem orchestrator. It is a webshop and procurement tool for municipalities, and it also acts as an automated sales channel for tech companies.

It’s a win-win-win
Crucial to successful ecosystems is opening up to external parties. Although this could initially be challenging, working together in ecosystems usually creates win-win-win for all parties involved. The Digital Toolbox from Serendipity is a case in point; Serendipity has created incentives for tech companies to join the webshop. The tool helps them become compliant with EU legislation (which is, surprisingly, often not the case) through the onboarding process and includes functionalities to present themselves towards potential clients. This is free for tech suppliers in order to tailor to the needs of a common client: municipalities. For clients the digital toolbox means having all tech providers available while knowing that interoperability and compliance will meet their needs.

With the increase in complexity in technological innovation, working in ecosystems becomes more and more important. An ecosystem could be spurred by starting a small community to attract members with common interests. This forms the basis to expand with a more diverse set of stakeholders and become the orchestrator, as the AIIC. The Digital Toolbox from Serendipity on the other hand, demonstrates that developing a tool is a distinct way of orchestrating an ecosystem. Establishing the right incentives creates mutual advantages for tech suppliers who develop solutions and cities who need a Digital Twin. Removing barriers allows Serendipity to jointly position themselves with technical partners towards a common client. Regardless of how you look at it, open communication and transparency will help build effective partnerships and collaborations. 

By Arne Steemers, Serendipity, and Karina Garcia del Real, AI Innovation Center.

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