Friday, January 10, 2014

A Digital Innovation Ecosystem

An innovation ecosystem is a systematic innovation methodological environment or a sort of innovation philosophy.

Innovation is changing to tackle the complexities of the business dynamic, but within itself, it needs to change as well. There is a paradigm shift that is taking place in generating innovation and building a scalable innovation environment or an innovation ecosystem.

An innovation ecosystem should fully cover a wide enough direction: For example, cost optimization, waste reduction, quality improvement, capability orchestration, problem-solving, etc. When the designed objects’ scale becomes much bigger, it involves more and more aspects widely, so the businesses need innovation silver lining from specific tools rising to an overall problem-solving system environment.

"Systemic" vs. "Systematic" Innovation: "Systemic" relates to "from within" or the genes of the organization, hence it ties to cultural and leadership aspects (soft factors) of innovation, where "systematic" relates to capacities of hard methodologies, practices, and tools. Hence, there is a need for innovation methods or tools around, but they neither create nor replace the culture, leadership, commitment, reward system, etc. in building systemic innovation

There are many components in an effective innovation environment or ecosystem: Each component by itself may not cause a good environment, but collectively they can and weave an innovation ecosystem such as innovation leadership, innovation culture, innovation capability, practices, tools, recognition system measurements, risk approach. Innovation ecosystem or the methodological environment should cover the whole innovation process, from processes in managing ideas or idea handling systems to idea implementation & promotion. That's why it is a set of means including methods that cover the process from the problem's choice till commercialization.

An innovation ecosystem is a systematic innovation methodological environment or a sort of "professional philosophy" for innovation: An enriched innovation ecosystem enables systematic innovation management. It starts with an innovation strategy that defines "WHAT does the organization innovate" or "where should it innovate" to support the overall strategy. The strategy is tightly connected to the business model and provides the context for innovation. The organizational context is the innovation capability which is how the organization innovates. 

Variety, complexity, diversification, and collaboration are the characteristics of the digital innovation ecosystem:  
Organizations can no longer rely on a single individual or team to drive innovation. This is largely due to the fact that innovating in today’s digital world has become increasingly complex in nature. Innovation needs to layout different structures, thinking and solutions to allow this to develop in its potential where organizations are combining all that is available to them in imaginative, adventurous ways. This is why so many leaders have begun using collaborative methodologies as infrastructures to orchestrate their organization’s talent and bring out their collective best thinking to accelerate innovation and optimize their solution forming capabilities.

The business competitiveness is gated by innovation, and their innovation is gated by their ability to "systematize" innovation as opposed to relying on sporadic talent, therefore, the innovation ecosystem is for the long-term and more of a catalyst for scaling up innovation.


Since 1900, there have been four generations of best practice in innovation management. The current fourth generation (4G) has 12 principles which describe how to create an ecosystem based on new capabilities and structures of those capabilities called architectures that creates the new dominant designs that determine competitive capabilities, products, services, business models, markets ,value chains, supply chains and transformed industries. The 12th principle of 4G describes how a group of partners from business, academia and government called a "galaxy" are formed and collaborate in an Innovation Hub to create new dominant designs that are adopted by customers as solutions to their unmet needs.

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