Marcin Baron : Partner at InnoCo

HOW TO BUILD LOCAL AND REGIONAL INNOVATION-ORIENTED ECOSYSTEMSMarcin BaronTAFTIE Expert session“Innovation-oriented ecosystems”September 10,2014, Gdynia, Poland

Marcin Baron: • Partner at InnoCo • Fellow of the University of Economics in Katowice (Department of Strategic and Regional Studies) • Member of Regional Studies Association and International Society for Professional Innovation Management • Appointed to Polish Academy of Sciences Task Force on Regional & Spatial Policy in Poland and Europe • Co-author of Regional Innovation Strategy of Silesia (PL) and several innovation policy documents • baron@innoco-team.com +48506035345 www.innoco-team.com

So… we want ecosystems…

Don’t think it’s Nature.It’s HBR !The fairly old one… Harvard Business Review, May-June 1993 drawing by TraianFilip

If there are predatorswho’s gonna be a prey?

{Camera switch. Mufasa and Simba are out walking on the savannah.}Mufasa:Everything you see exists together, in a delicate balance. As king, you need to understand that balance, and respect all the creatures-- from the crawling ant to the leaping antelope.Simba:But, Dad, don't we eat the antelope?Mufasa:Yes, Simba, but let me explain. When we die, our bodies become the grass. And the antelope eat the grass. And so we are all connected in the great Circle of Life.

{Camera switch. Mufasa and Simba are out walking on the savannah.}Mufasa:Everything you see exists together, in a delicate balance. As king, you need to understand that balance, and respect all the creatures-- from the crawling ant to the leaping antelope.Simba:But, Dad, don't we eat the antelope?Mufasa:Yes, Simba, but let me explain. When we die, our bodies become the grass. And the antelope eat the grass. And so we are all connected in the great Circle of Life. The Walt Disney Co. 1984, 1994

The principal learning: • The Birth • of BusinessEcosystems • Bet on a seed innovation that canlead to revolutionary products. • Discover the right customer valueproposition. • Design a business that can servethe potential market. J.F.Moore, Predators and Prey: A New Ecology of Competition, Harvard Business Review, May-June 1993

Remark no.1:Business ecosystemscome from business (not policy)and are for business.

As seen in 1993: • For example, Apple Computer is the leader of an ecosystem that crosses at least four major industries: personal computers, consumer electronics, information, and communications. The Apple ecosystem encompasses an extended web of suppliers that includes Motorola and Sony and a large number of customers in various market segments. • Apple, IBM, Ford, Wal-Mart, and Merck have all been or still are the leaders of business ecosystems. While the center may shift over time, the role of the leader is valued by the rest of the community. Such leadership enables all ecosystem members to invest toward a shared future in which they anticipate profiting together. J.F.Moore, Predators and Prey: A New Ecology of Competition, Harvard Business Review, May-June 1993

Remarkno.2:Every stick has two ends. But contemporary ecosystems have three perspectives.

Themicro-perspective: M.A.Carpenter, Wm.G.Sanders, Strategic Management - a Dynamic Perspective, Pearson 2007

Themeso-perspective: M.A.Carpenter, Wm.G.Sanders, Strategic Management - a Dynamic Perspective, Pearson 2007

The macro- perspective: • State policy / state regional policy: • National (smart) specialisations • Structural policy • Sectoral policy • (Intra-) regional policy: • Regional (smart) specialisations; clusters etc. • Attracting investors • …

What drives policy makers and policy recipients? • State policy / state regional policy: • National (smart) specialisations • Structural policy • Sectoral policy • (Intra) regional policy: • Regional (smart) specialisations; clusters etc. • Attracting investors • …

Typology of regional innovation systems: • Grassroots RISs are characterised by local initiatives, diffuse funding, applied, near-market research, low level of technological specialisation and local co-ordination. • Network RISs can be initiated at several levels: local, regional, federal or governmental. Consequently, funding is more likely to be agreed by banks, firms and government agencies. The research is mixed, aimed at both applied and ‘pure’ technology with flexible specialisation give the wide range of participants. • Dirigiste RISs are more animated from outside and above the region itself, initiated and funded typically by central governments. The research is rather basic or fundamental, to be used in large firms in or beyond the region in question. As it is state-run, the level of co-ordination is high and the level of specialisation is also likely to be high. R.L.Martin, A Study on the Factors of RegionalCompetitiveness, A draft final report forThe European CommissionDirectorate-General Regional Policy, 2003

Remarkno.3:Mind the ‘Circle of Life’.

As seen in 1993: • A business ecosystem, like its biological counterpart, gradually moves from a random collection of elements to a more structured community. Think of a prairie grassland that is succeeded by stands of conifers, which in turn evolve into a more complex forest dominated by hardwoods. Business ecosystems condense out of the original swirl of capital, customer interest, and talent generated by a new innovation, just as successful species spring from the natural resources of sunlight, water, and soil nutrients. J.F.Moore, Predators and Prey: A New Ecology of Competition, Harvard Business Review, May-June 1993

J.F.Moore, Predators and Prey: A New Ecology of Competition, Harvard Business Review, May-June 1993

Remark no.4:There’s no one-size-fits-all solution.

Accept and allow different arrangements. Don’t believe in models too much! M.A.Carpenter, Wm.G.Sanders, Strategic Management - a Dynamic Perspective, Pearson 2007

M.Baron, Analiza aktorów regionalnego ekosystemu innowacji, in press

Animator’srole institution Animator’srole person M.Baron, Regional innovation ecosystem’s actors analysis, in press

Remark no.5:Names will change. Change leaders do their job anyway.

Do you like it? W.Vanhaverbeke, From open innovation to innovation ecosystems, presentation of 6 May 2014, SlideShare

Chesbrough and Vanhaverbeke already ‘killed’ the OI we know. W.Vanhaverbeke, From open innovation to innovation ecosystems, presentation of 6 May 2014, SlideShare

M.Curley, B.Salmelin, Open Innovation 2.0: A New Paradigm, EU Open Innovation Strategy and Policy Group 2013

And what’s yourlabel?How do youapproach? Management Economics, Regional Science Business (R&D) model perspective Territorial perspective Business model canvas Value chain Open innovation Networking Industrial districts Innovation milieux Competitiveness (techno) poles Regional innovation systems

And what’s yourlabel?How do youapproach? Does it really matter? It really does matter!

Remarkno.6:Prahalad and Krishnan might change your understanding.

R=Gn=1 C.K.Prahalad, M.S.Krishnan, The New Age of Innovation: Driving Cocreated Value Through Global Networks, McGraw-Hill 2008

R=G n=1 Whetherwe like or dislike it regional dimension is not fancy any longer… But sound business will always be promising! How about being local for global value chains?

Remark no.7:Big policy programmes change the rules of the game. Make them supportive!

In Poland: • National Science Centre • The National Centre for Research and Development

Again, thinking that regional economy calls formainly regionally bound policy instruments is a commonmistake.

What do we want ? Don’t know ! When do we want it ? Now!

Exemplarypolicy approach

Regional Innovation Strategy of the Śląskie Voivodeship for the years 2013-2020, Katowice 2012

Thank you for your attention. Feel free to ask & discuss !

Marcin Baron : Partner at InnoCo