Open Biz Models

Associations create new opportunity through the “usual suspects”: Membership, Meetings, Tradeshows, Publications, Professional Development, Certification, Digital Libraries, Affinity Programs, etc.

Any kind of innovation came incrementally and end users were satisfied with buying product and service experiences that were mostly one size fits all.

The problem with this approach in today’s world is that it doesn’t create a compelling competitive advantage as the marketplace fills with direct and indirect competition for “consumables.” The contents of our value proposition has become commoditized like sacks of potatoes.

Today’s leading edge business models are redefining how to serve individual professionals and industry through “new ways to associate” by creating essential services that impact business and professional pursuits in direct and measurable ways.

As examined in more detail in the section entitled Case 4 Change, the open source movement driven by Linux (see video) has spawned new thinking in the value of opening one’s business model to create opportunity that was previously unthinkable.

The Value of Open Business Models as this section will explain includes the ability to tap useful knowledge and technology increasingly widespread across and outside your business, lower costs for innovating new or existing products and services, speed time to market of products and services, shorten product lifecycles, promote the ability to share risks with others, and build stronger customer/member loyalty and sell through.

At the core of Open Business Model innovation is the use of community as a means of collaborative exchange driving new forms of revenue and profit potential.

Like the bee pollinating from flower to flower she creates value for her hive and the ecosystem she serves. She is the intermediary that ties the ecosystem (or network) together. The network benefits by creating new opportunities that each component couldn’t by themselves.

This section will examine a host of proven best practices from the front line of innovation to illustrate that the power of “Intermediate markets” – where an upstream provider licenses its know how to downstream developers and producers. According to Henry Chesbrough in his book “Open Business Models” there is growing evidence that IM’s 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 them properly your own means of internal innovation must be connected to external communities.

OBM’s to examine include such leading innovators as:

  • Big Idea Group – a “product development agent” that brings together creative inventors and innovation-driven companies
  • InnoCentive – a “broker/agent R&D community” matching scientists to R&D challenges presented by companies worldwide
  • InnovationXchange – a commercially neutral, not-for-profit, global knowledge network which delivers “an intermediary business service” to company members
  • NineSigma – works on behalf of its member clients as a “sourcing agent” for innovative ideas, technologies, products and services from outside their organizations by connecting them innovators around the world

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