creating radical business innovation in the connected ... · creating radical business innovation...
TRANSCRIPT
David ReynoldsResearch Associate/PhD Stuent, IIPSI, WMG
Social Media Manager, DE NEMODE Network+
Creating Radical BusinessInnovation in the ConnectedDigital Economy
@nemode_netplus
@sswmg
www.linkedin.com/pub/david-reynolds/11/4a0/71
www.warwick.ac.uk/go/sswmg
www.nemode.ac.uk
What is value? A brief history lesson
3 May, 2013 2
Value was exchange (what I got for what I gave)“That was good value for money!”
But it wasn’t exchange that made us happy. It wasexperiencing what we bought that gave us theoutcomes we wanted
We buy because of the service of the object,even if it was an emotional ‘service’ i.e. things areservice avatars*
Mike Kuniavsky, 20103 May, 2013 3
Posession was the only way to getthe ‘service’ of an object
• Previously, the only route toservice/outcomes was through possessione.g. music CDs
• But outcomes/benefits come only in thecontext of use and experience
• If firms found a way to serve contexts,individuals may not need to posess
• Case in point: Music Streaming
3 May, 2013 4
Value created is Contextual. Resources aretherefore also Contextual.
This camera isavailable so it is
a resource incontext
Thiscamera is
not
Things become more valuable in context because theyenable resources for value creation
VALUE INCONTEXT
3 May, 2013 5
Two functionally the SAME cameras but not thesame value for the user in context. Because onecamera is less competent in context, one is a
lesser service avatar (or is just simply notaround!)
COMPETENCY OF OFFERING IN CONTEXTIS KEY TO NEW MARKETS
Why context is important
3 May, 2013 6
But to bring your digitised offering(content) into context, you need a
medium/platform (widget),connectivity, and a social space
An example of digital ‘service’ in context: apps onyour mobile
• Dictionary• Calculator• Calendar• Torchlight• Camera• And more!
I’m Batman!
Digitised offering incontext
Who is digitising to serve usecontext next?
• Digitisation enables traditional offerings to become aresource in context, reducing time between acquiring aresource and using a resource - expanding demand
3 May, 2013
In context
Digitisation+Data is thenew oil, Context is the new
oil-field
9
Mobile phone as the medium topropose digitised offerings in context
• Why is the mobile phone one of the mostpopular device for digitised offeringstoday?
• because it is often present in MANY livedexperiences (contexts)
• It may not be the only widget servingmultiple contexts for much longer!
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Once upon a time, our contexts wererather homogenous
• Where/when we ate meals
• Where/when we listened to music
• Where/when we exercised
3 May, 2013
• *Technology liberates us from constraints of– time, when things can be done
– place, where things can be done
– actor, who can do what
– constellation, with whom it can be done
*Reframing Business, Normann, 200111
Markets are forming at whereservice creates most wealth – incontext Digitisation allows new
offerings to beresources: available,
accessible on demand,in context
The better you are ableto serve context, thebigger your market
Competitive Dynamics
• Serving Contexts changes the natureof competition
• Land grab creates disruption, enabledby new technologies. How?
3 May, 2013 13
BUSINESS MODEL VS ECONOMICMODEL
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15
ValueCreation
Valueprop
Val
ue
cap
ture
Val
ue
cap
ture
EMI, Sony BMG
person
MUSIC
ENJOYINGMUSICMoney from access e.g.
spotifyMoney from ownership
(e.g. CD)Money from eyeballs (eg.
Google)
ECONOMIC MODEL- Where exchanges comefrom, what exchanges arethere, creating worth fromvalue creation
BUSINESS MODEL
E.G. MUSIC - CONTENT
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16
ValueCreation
Valueprop
Val
ue
cap
ture
Val
ue
cap
ture
EMI, Sony BMG
person
MUSIC
ENJOYINGMUSIC
Money from accesse.g. last.fm
Money from ownershipe.g. iTunes
Money from medium(e.g. CD)
E.G. MUSIC - WIDGET
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ValueCreation
Valueprop
Val
ue
cap
ture
Val
ue
cap
ture
Apple, MP3 player, Computer
person
WIDGET
ENJOYINGMUSIC
Money from ownership
E.G. MUSIC - CONNECTIVITY
3 May, 2013 18
ValueCreation
Valueprop
Val
ue
cap
ture
Val
ue
cap
ture
O2, Vodafone, Three, Orange
person
WIFI, 3G
ENJOYINGMUSIC
Money from access
E.G. MUSIC - SOCIAL
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ValueCreation
Valueprop
Val
ue
cap
ture
Val
ue
cap
ture
Myspace, facebook,google+, twitter,spotify
person
Sharingplatform
ENJOYINGMUSIC
Money from eyeballs(ads)
E.G. MUSIC - GYM
3 May, 2013 20
ValueCreation
Valueprop
Val
ue
cap
ture
Val
ue
cap
ture
GYMS
person
Sport &fitnessenvironment
ENJOYINGMUSIC &SPORT
Money from access
Industries propose value incontext
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Value
n
ValueCreatio
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Valueprop
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ue
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Value
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personperson
Valu
eC
reation
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ep
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GYMS
perso
nAPPLE,CREATIVE(WIDGET)
SONY, EMI(CONTENT)
SKY, VIRGIN(CONNECTIVITY)FACEBOOK, MYSPACE
(SOCIAL)
Value Constellation of Music in Context
3 May, 2013 22
Value
n
ValueCreatio
n
Valueprop
Val
ue
cap
ture
Val
ue
cap
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Value
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ValueCreatio
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personperson
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GYMS
perso
nAPPLE,CREATIVE(WIDGET)
SONY, EMI(CONTENT)
SKY, VIRGIN(CONNECTIVITY)FACEBOOK, MYSPACE
(SOCIAL)
Person enjoying musicin context
Many persons enjoyingmusic in context
Value Constellation of Music inContext
3 May, 2013 23
Valueprop
Val
ue
cap
ture
Val
ue
cap
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Valueprop
Valu
ecap
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ep
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GYMS
APPLE,CREATIVE(WIDGET)
SONY, EMI(CONTENT)
SKY, VIRGIN(CONNECTIVITY)FACEBOOK, MYSPACE
(SOCIAL)
Person enjoying musicin context
PIE
Many persons enjoyingmusic in context
Value Constellation of Music in Context
3 May, 2013 24
Valueprop
Val
ue
cap
ture
Val
ue
cap
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Valueprop
Valu
ecap
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Valu
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ep
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Value captureValue capture
GYMS
APPLE,CREATIVE(WIDGET)
SONY, EMI(CONTENT)
SKY, VIRGIN(CONNECTIVITY)FACEBOOK, MYSPACE
(SOCIAL)
Person enjoying music incontext
PIE
• The Value constellation map shows you which industry has astake in which OTHER industry to expand their marketpenetration, driving disruption, convergence, land grab
Many persons enjoyingmusic in context
Value Constellation of Music inContext
3 May, 2013 25
Valueprop
Val
ue
cap
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ue
cap
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Valu
ecap
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alue
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alue
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ValueValueprop
Valueprop
person
Valu
ep
rop
Value captureValue capture
GYMS
APPLE,CREATIVE(WIDGET)
SONY, EMI(CONTENT)
SKY, VIRGIN(CONNECTIVITY)FACEBOOK, MYSPACE
(SOCIAL)
Person enjoying musicin context
PIE
Many persons enjoyingmusic in context
I want to playthere becausemore content
that I control willdrive my
connectivitybusiness
Value Constellation of Music inContext
3 May, 2013 26
Valueprop
Val
ue
cap
ture
Val
ue
cap
ture
Valueprop
Valu
ecap
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ValueValueprop
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person
Valu
ep
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GYMS
APPLE,CREATIVE(WIDGET)
SONY, EMI(CONTENT)
SKY, VIRGIN(CONNECTIVITY)FACEBOOK, MYSPACE
(SOCIAL)
Person enjoying musicin context
PIE
Many persons enjoyingmusic in context
I want to playthere becausewidget that I
control will securemy connectivity
business
Value Constellation of Music inContext
3 May, 2013 27
Valueprop
Val
ue
cap
ture
Val
ue
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ecap
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ValueValueprop
Valueprop
person
Valu
ep
rop
Value captureValue capture
GYMS
APPLE,CREATIVE(WIDGET)
SONY, EMI(CONTENT)
SKY, VIRGIN(CONNECTIVITY)FACEBOOK, MYSPACE
(SOCIAL)
Person enjoying musicin context
PIE
Many persons enjoyingmusic in context
I just want to make surethese guys can’t do it
without me
Connectivity & Digitisation
• TV was in a room
• Music was on speakers and stereo players
• Digitisation & Connectivity is changing contextsof use
• Changing contexts of use is bringing differentindustries into a context e.g. Tesco has a stake inyour car – will they pay your insurance?
• Disruption & Convergence comes fromunderstanding value constellation of the context
3 May, 2013 28
Changing Value Constellations
• With more digital connectivity, there aremore connected contexts – lateraldependencies between vertical industries –potential disruption and encroachment ofother verticals
• more constellations with different playerswill emerge, converging stuff, creatingnew ways to capture value, generatingnew business models, creating disruptions
3 May, 2013 29
So what does this have to dowith data?
• Digitisation & Data is the new oil; Contextis the new oil-field
• It’s not just about collecting data; youneed to ‘drill’ in the right place
• Looking at the value constellation of thecontext will help you to better identifywhere convergence/disruption could occurand what data can/should be collected.
3 May, 2013 30
For more information:
By Prof. Irene Ng,WMG/Cambridge
Currently available forAmazon Kindle/.pdf and can
be found at:www.valueandmarkets.com
Printed version comingDecember 2013
3 May, 2013 31
Visit www.nemode.ac.uk for News,Case Studies, Conferences, Calls forResearch and AwardsCurrent call: 2nd Dragon’s Den£10k top prize & 3 Runner up prizes
of £3kAimed at researchers in New BusinessModels (funded at 80% according to Research
Council funding regulations)
Stage 1 Competition Entry: 25th May
Watch this space! Currently working on a Business Model Ideationprocess based on the ideas discussed here. We hope to make itavailable to businesses in the West Midlands (and beyond!) in thenear future!