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Open innovation in Eindhoven-Brainport ecosystem

Keynote address to Eurocities KSF - ICF conference, 20-21 October 2011. This keynote involves an assessment of open innovation in the Eindhoven-Brainport ecosystem - the "most intelligent community of the world" (according to ICF, 2011).

Sjoerd (Georges) Romme

on 30 April 2013

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Transcript of Open innovation in Eindhoven-Brainport ecosystem

Open innovation in
the Brainport ecosystem
a substantial number of hightech systems (component) firms, mostly created by Philips (e.g. ASML, NXP, FEI)
an open culture and melting polt of different people / backgrounds have gradually developed
favorable conditions for cooperation between industry, academia and government have arised As a result: Sjoerd Romme

prof. dr. A.G.L. Romme
professor of Entrepreneurship & Innovation
Email: a.g.l.romme@tue.nl assessment of the "open innovation" ecosystem Eindhoven-Brainport: in Eindhoven-Brainport ecosystem:
with the advent of car & truck manufacturer DAF and the technical university (1956) and
the subsequent shift towards electronics & engineering,
the traditional textile and tobacco industries waned and almost completely disappeared in the 1970s cognitive
proximity physical
proximity social
proximity average distance (e.g. in metres) between participants in ecosystem: high proximity increases the chances that (e.g. knowledge workers) A and B connect with each other and share tacit knowledge (Frenken, 2009) number of network ties shared: large shared network enhances trust between A and B, which makes it easier for both firms to invest in the relationship and share knowledge (Frenken, 2009) the extent to which people understand each other, based on shared knowledge and experience: without any cognitive proximity, A cannot effectively assess the value of products & processes of B (Gilsing et al. 2008) cognitive
proximity physical
proximity social
proximity too low proximity leads to lack of focus & coherence !

BUT: too high proximity implies lack of openness and diversity Source: Hoekman, Frenken & Tijssen (2010), "Research collaboration at a distance : changing spatial patterns of scientific collaboration in Europe. " Research Policy,  vol. 39, 662-673 source: Hoekman, Frenken & Tijssen (2010) collaboration between research groups:
each tie ≥ 300 co-publications collaboration between research groups
(each tie ≥ 1000 co-publications) collaboration between research groups
each tie ≥ 500 co-publications Source: Hoekman, Frenken & Tijssen (2010), "Research collaboration at a distance : changing spatial patterns of scientific collaboration in Europe. " Research Policy,  vol. 39, 662-673 Source: Hoekman, Frenken & Tijssen (2010), "Research collaboration at a distance : changing spatial patterns of scientific collaboration in Europe. " Research Policy,  vol. 39, 662-673 source: Hoekman, Frenken & Tijssen (2010) conclusions collaboration is becoming more important
mean physical distance (in km) is slowly growing
major differences in mean distance between e.g. physics and engineering --> engineers less easily cooperate across large distances (cf. sharing tacit knowledge) regional proximity as well as sharing the same language & country (cf. institutional setting) continue to be very important in their R&D activities and investments, firms & research institutes:
source globally for ideas and knowledge
but most new knowledge (still) arises from local/regional collaboration - even more so in engineering disciplines there is lot's of talk about triple helix and open innovation, but putting the theory into practice requires a shared vision & ambition as well as perseverance
Brainport was set up as a cooperative venture (foundation) of industry, educational/research institutes and local government which ... establishing an ongoing 'triple helix' process Overall assessment of
open innovation in Brainport ecosystem: effective R&D is driven by:
physical, social & cognitive proximity
focus on local & regional collaboration (while sourcing globally for ideas & knowledge) source: Chesbrough (2003; 2006) source: Chesbrough (2003; 2006) BUT:
How to turn "open innovation" theory into reality ? From "closed" innovation ... ... to "open" innovation around 1900 (industrial revolution), local manufacturers in textiles, tabacco, matches and light bulbs (Philips) started attracting many workers from elsewhere Philips and the small municipality of Eindhoven had to adapt, e.g. by incorporating and merging with neighbouring villages (around 1920) and creating housing, educational and other facilities proximity
(distance) context key actions outcomes establishing & supporting growth of several campuses developing an advanced practice of (precompetitive) R&D collaboration enhances trust and respect between all participants
operates bottom-up, to define shared priorities and projects
is not constrained by the usual boundaries of public administration Embedded Systems Institute (ESI)
Holst Centre
DevLab (Development Laboraties) when Philips started downsizing and relocating many of its operations, the region faced the challenge of creating a new basis for economic growth
which was the basis for creating the "Horizon" program (2002) and subsequently the "Brainport" foundation (2006) source of photos: www.hvogels.dds.nl DevLab Examples A cooperative venture of 12 SME's in the field of industrial electronics
Goal: creation of new business (opportunities) for SME's by means of collaborative R&D members contribute 1% gross wages + time
members together determine research agenda
Devlab's staff acquires additional funding and subsidies
knowledge circulation by teaming up with universities and other research institutes
IP developed is owned by DevLab, but can be used by all members business model & approach: results (after 7 years): several technological innovations, including a new approach towards wireless sensor networks (inspired by processes in nature), in which large numbers of autonomous devices collectively perform
substantial network of firms, universities, research institutes & government agencies that all DevLab members benefit from
independent open-innovation R&D centre that develops generic technologies for Wireless Autonomous Sensor Technologies and Flexible Electronics
located on High Tech Campus Eindhoven; currently employing over 160 employees from 28 nationalities
set up in 2005 by imec (Belgium) and TNO a key feature is the partnership model with industry and academia, based around shared roadmaps & programs -- with current commitment from more than 30 industrial partners
this cross-fertilization enables Holst Centre to tune its research strategy to industrial needs source: http://www.holstcentre.com Holst Centre's R&D results are shared on a non-exclusive basis between the program partners by customized agreements tuned to the needs and situation of each partner
if appropriate, there is room for a limited amount of exclusive R&D activities with a selected partner business model of Holst Centre DevLab Holst Centre Several campuses provide centers of gravity in broader ecosystem: High Tech Campus Eindhoven
TU/e Science Park
High Tech Automotive Campus

NB: campuses are critical to any ecosystem, because their focus, coherence and momentum can be more easily managed
facilitating R&D and innovation (e.g. by providing access to technical facilities & services)
creating an innovation community (e.g. by organizing a variety of meetings, conference facilities, etc) HTCE creates value for its residents by: Source: Van der Borgh, Cloodt & Romme (2012), "Value creation by knowledge-based ecosystems: evidence from a field study", R&D Management, vol. 42: 150-169. Each campus must have a strong value proposition and business model
To optimize proximity & collaboration advantages, the population of technology firms, service companies & research institutes needs to be actively managed ...
by actively acquiring new residents as well as facilitating exit routes for firms that no longer fit the value proposition source: van der Borgh, Cloodt & Romme (2012) due to the increased complexity of engineering, physics, life sciences, materials, electronics and software

the cost of R&D is growing faster than revenues of individual companies

share ideas and efforts, cost and risk of R&D
reduce the time-to-market of new product generations
combine internal & external sources for developing as well as commercializing new technologies & products
generative mechanisms
key actions
overall assessment open innovation: need to further grow its (inter)national prominence & reputation (cf. battle for talent)
create (more) living labs & testbeds
reduce its sensitivity to economic cycles
attract more risk capital (providers) the Eindhoven-Brainport ecosystem ... has developed a clear and attractive profile contributes significantly to Dutch innovation capacity provides a vibrant business climate for hightech start-ups recently received international recognition continues to evolve; future challenges include: open culture & local history of collaboration between private and public sector
strong network of hightech OEMs (incl. supply chain) context key actions outcomes establishing an ongoing 'triple helix' process
establishing & supporting growth of several campuses
developing an advanced practice of (precompetitive) R&D collaboration clear profile
contribution to Dutch innovation capacity
vibrant business climate for start-ups
international recognition
facing future challenges generative mechanisms Keynote address to Eurocities KSF - ICF conference
21 October 2011 since the early 20th century, the Eindhoven region co-evolved and exhibited strong growth with the rise of Philips generative
mechanisms Horizon 2020 program (EU) for research & innovation will need to provide ample opportunities for regional R&D collaboration, to boost economic growth and innovation in Europe
Communities thriving on distributed intelligence & leadership draw on a long tradition of mutual trust & respect (Kets de Vries, 1999)
As such, the open innovation practices in Eindhoven may not be easily transferable to other regions -- particularly those without a long history and culture of openness & collaboration some implications collaboration generative
mechanisms context key actions outcomes source: Brainport Development, 2011 source: Brainport Development, 2011 source: ASML Source: High Tech Campus Eindhoven source: Brainport Development, 2011
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