Always Open, Always On “Ecosystem” of Ideas

23 03 2007

Imagine you had a tradeshow where people could extend the traditional customer experience of prospecting for suppliers or clients by morphing it into a real marketplace for completing business deals or joint ventures. This might be between companies or a company and an individual. Expectations would certainly improve as you begin to broker outcomes that impact their businesses in measurable ways. The old days of simply selling them a booth or forcing them down the aisle saying “talk amongst yourselves” could be replaced by serious business-making activity that you broker. And further imagine this marketplace was open for business 365 days of the year online and was geographically agnostic.

Wouldn’t that dramatically alter the value proposition of a tired old business model? Might that expand your brand name to a wider international audience of buyer and seller who might not even be a member?

Well that is what the latest innovative businesses are doing through the creation of products or services using open business models. They are referred to by Henry Chesbrough author of Open Business Models as “intermediary markets” and they are changing how business gets done all around the world.

Why You Need to Consider These for Your Association?

In most cases, associations have been using a variety of product and services over the past 50 years including such winners as: meetings, tradeshows, publications, professional development, certification, affinity programs, etc. Even more recent creations such as digital libraries which have protected intellectual property and sold iterative copies to other audiences has been a strong revenue driver especially among scientific, medical and technical groups. Of course with the advent of open access and better search tools from Google and others, the long term value of these repositories are being questioned.

The above customer experiences have supported the old value proposition of associations such as leg/reg, publishing, professional development and networking/business promotion. Unfortunately, in the current global business environment driven by disruptive technology and new players innovating products and services targeting the “essential needs” of your customers, the “old reliables” are seen more and more by member consumers as commodities with less compelling competitive advantage that struggle to deliver the outcomes expected.

New more Open Business Model approaches are designed to directly enable business opportunity of your members and customers. They are redefining how to serve individual professionals and industry through “new ways to associate” by creating an essential service that impacts business and professional pursuits in direct and measurable ways. And they use online community as a core platform to deliver services driving new innovations with high revenue and profit potential while building strong brand loyalty.


To put it another way, think of a bee moving from flower to flower pollinating as she goes, creating value for the flowers, herself and her hive. She is the intermediary that ties the “network or ecosystem” together. The network benefits by creating new opportunities collaboratively they couldn’t do by themselves.


The Value of Open Business Models

Intermediate markets (or networks) tap useful knowledge and technology increasingly widespread across and outside your control. They lower costs for innovating new or existing products and services. They are faster to market with “essential” products and services that markets desire. They have shorter product lifecycles, and their model promotes “shared risk” with others. Finally they seem to build stronger customer/member loyalty and sell through.

Chesbrough believes there is growing evidence to suggest that “intermediate markets” are becoming integral to innovation and growth. They can help you enter a new business. But they can be used by others to block you from entering as well. And to leverage properly internal innovation must be connected to external communities.

In my next posts will be examining five open business models:

  • InnoCentive
  • NineSigma
  • Cambrian House
  • Big Idea Group
  • InnovationXchange











One response

1 11 2007
John Wolpert

Great post, Peter. Did you ever write that follow-on about InnovationXchange and the others?

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