The Open Economy90:10 Group: Your Open Business Partner

IntroductionThe Open Economy & Open Business

• Social media has shown people are willing to engage with brands; share, discuss, create and offer ideas

• It has given birth to new platforms dedicated to opening innovation to the crowd

• Most believe this can deliver value across the whole organisation from marketing to product and service innovation

• But few know how to move beyond experimentation to scale into business transformation

• As big firms struggle to overcome their legacy issues market forces become more open, connected, and social

• This means big disruptions and challenges to them and their agencies • We call this environment The Open Economy and our framework for

response to it is Open Business.

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The Open Data MovementData is expected to be shared and open

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API: The idea of organisations making their data easily accessible to outsource and derisk innovation or offer for public good

Companies such as Facebook are valued on the data of its users – who trade it in return for utility

Hacktivism at its roots is about exposing hidden truths; be that how poorly companies protect your data or the secret dealings of super powers and shady corporations.

Open CapitalThe democratisation of capital means increased competition

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• There are more than 450 crowd-funding platforms around the world• With 5 white-label crowd-funding platforms introduced this year• To date $1.5 billion dollars has funded more than 1 million projects• 55% in Europe, 44% in the US and 1% in other regions• The average crowd-funding project takes 10 weeks from beginning-to-end

Open Innovation ScaledCo-creation is being applied across all business innovation gates

Open Innovation has existed since the 1960s, a term promoted by Henry Chesbrough, but with the recent advent of affordable and widely used collaborative technologies, it can be applied at scale.

There are now hundreds of co-creation and idea crowd-sourcing platforms and case-studies across almost every sector from FMCG to Automotive. With brands like Proctor & Gamble driving 60% of all innovation from partnerships outside their organisation.

Networked Human CapitalAn increasingly virtual workforce crowd-sources solutions

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The Open EconomyThe new market reality

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Open Data Movement

Powered by: Social Media + Internet Culture of Openness x People

Open Innovation Scaled

Open Capital(Crowdfunding)

Open Organisation

(Crowdsourcing)

The Open Economy

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Open Business

Crowd-sourcing Crowd-funding Co-CreationOpen Data

Untangling the buzzwordsOpen Business is structured use of the strands of Open Economics

Netnography

Market Forces are now; Connected, Open & LeanBecoming an Open Business is not optional just a matter of time

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Tomorrow’sCompetition

Customers Activists

Barrier to entry for competition has never been lower. Crowd-funding and white-label API tech dominate.

Almost every purchase cycle now involves a Google Search or Community Reach-out in both B2B and B2C

Organisations like Greanpeace see themselves as a platform for their advocates to lead change. Activist attacks have increased YOY.

Open BusinessFor communication, product & service innovation

• We think of social media as a door to the outside world.

• A door to; listen, ask, connect and create with people outside both partners, customers and experts.

• All for the purpose of competitive advantage in marketing, service and product innovation.

• Over the last 3 years we have developed a frame-work to deliver open business at an Enterprise level for blue-chip companies

Open Business Opportunities to become a better more profitable business

• Customer satisfaction increase of 20-30% achieved at 20% the cost

• Resulting in an increase of 31% in customer retention• 27% increase in existing customer sales• 31% increase in brand advocates (each worth 5 x the

average customer)• 34% increase in feedback & ideas from customers• 34% increase in brand awareness• 27% increase in new customer sales• 31% increase in ideas generated within the company• Net profit per employee rose by 53%• Overall sales-to-assets increase of 66%

Sources: Cohort-Study on Social Innovation – TNO Work & Employment 2008-09P&G Connect & Develop Program – Harvard Business review June 2011Social Business Software Survey (Jive Funded) 2010BT Care Interview 90:10 Group Jamie Burke

Closed businesses can’t competeOpen equals a better fit with the networked world

• Many of the success stories of the 21st Century are built on multiple Open Business Principles. Google, Apple and Amazon are among the more famous.

• According to IBM’s CEO survey in May 2012, companies that outperform their sector are 30% more likely to identify ‘Openness’ as a key factor in their success with particular benefits for collaboration and innovation.

• Businesses starting today build on the Principles of Open Business from the word go. They do so because the principles are self-evident to those growing up in a networked world.

• They know they are simply the most effective way of taking greatest advantage of the world as it exists today.

• This places them at significant competitive advantage over those who are not seeking to apply the principles for legacy or other reasons.

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Challenges of the Open EconomyIssues for today’s corporations to address to survive

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Glocal Needs Corporate Citizenship

Declining & Migrating Trust

Exponential Data Sets

The combination of Globalisation in an internet age requires multinationals to be consistent globally but reflect local cultural nuances in a real-time way. This challenges traditional organisational structures and requires a breaking down of silos and market divisions.

It is no longer acceptable to just make a donation to charity or speak of good intentions through your CSR department. Our connectedness means you can’t just say, you have to do. If you want to be part of the online community you are expected to actively participate in the world around you as a good citizen

Trust in large media companies and brands is in decline. It is migrating to peers but in a complex and ever shifting way. The days of control advertising or clever PR are over.

More and more data is available for companies to mine - and make sense of. From big data, to real-time and behavioural data from mobile, social and other new sources. The desire to simplify the complexity is increasingly difficult to resist. But this reductionism risks destroying the true value.

People / System Community Culture Influence Insight

Minimum demanded in an Open EconomyNew entrants are emerging with these attributes as their default

1. Transparency2. Openness3. Connectedness4. Purpose

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