Ecosystems and platforms are the bases of success in the era of outcome economy

The outcome economy is a shift from competing by products and services to competing by measurable results valued by the customer. Delivering outcomes often demands innovating and problem-solving above the level of an individual product or solution and companies must work together to meet the needs of customers. In other words, outcome-focused business typically requires bundling resources from several actors, i.e. resource integration and value co-creation highlighted also in service-dominant-logic.

New opportunities to measure performance (outcome) have arrived on the scene in the shape of technology boosting industrial Internet or IoT (Internet of Things). IoT enables novel uses of data and companies have become aware of that they actually deliver outcome and it will more and more drive the competition. Digital platforms can collect and analyse data from bundled solutions and ensure that outcome commitments are met.

Despite of the hype around data and platform, customer understanding is the key for success also in the outcome economy: companies have to know the customers’ business inside out, commencing with understanding what the customers are really looking for and what outcomes really matter. Different resources will have to be pulled together, in collaboration with the customers as well as the suppliers and service providers, also to make this work together. Then, the ecosystem can enable to better address a customer need, as it can bring a diverse set of capabilities and innovation to the solution very quickly (see Figure below).

Outcome through value co-creation in a ecosystem

Outcome through value co-creation in a ecosystem.

All the partners in the ecosystem must have something unique, which is providing value for the customer by itself – but is concurrently aligned with joint objectives and complement the aimed outcome. Across many industries, the battle comes true between the ecosystems. This will comprise networks of collaborators, including customers, partners, suppliers, service providers, start-ups and competitors turned to “co-opetitors”. All ecosystem actors should collectively and transparently amplify the value creation opportunities for all participants, and solve problems and share out responsibilities if one or more parts of the system flop.

Ecosystems and platforms are not only for startups but it is essential also incumbent firms to shift their business practices and begin thinking in terms of ecosystems. One of the first steps to this direction is to consider the digital platforms bundling data from the viewpoint of customers’ desired outcomes, i.e. to understand how the data can be valuable to customers’ business. Another, crucial viewpoint is to consider outcome at the ecosystem level, i.e. explore what are the resource bundles that together provide the outcomes that meet customers’ expectations.

VTT is participating in the Manufacturing Performance Days 2017 – Welcome to join us at May 29–31 in Tampere, Finland!

Learn more about our activities in the event (SMACC laboratory visit and “Creating the Future Success” seminar) here. You can also register to the event.

In Twitter, follow #mpdays!

Katri Valkokari VTT

Katri Valkokari, Research manager
Twitter: @valkatti 

Tiina Valjakka VTT

Tiina Valjakka, Research Team Leader 
Twitter: @TiinaValjakka

Together but individually at the same dining table – how is this possible?

At the end of the working day, many of us browse the shop shelves, hungrily wondering what to make for dinner. Despite the huge choice, everyday food tends to vary little in many families.

We would find shopping easier if our mobile phones could tell us what we had in the fridge. It would be even better if our phones displayed recipe suggestions and a shopping list of missing ingredients. And what if an application remembered what flavours you like, or which ingredients are unsuitable for you or family members?

In VTT’s Food Economy 4.0 Vision this is an everyday reality. In the future, food production will become service-based and personalised. Digitalisation – which enables the collection and combination of information on issues such as individual consumer habits, the nutritional content of food and the environmental impacts of food production – is a driver of this development. New kinds of digital services for consumers can be created by combining information from various sources, and connecting it up to devices and products.

Information is a key raw material

Due to the digital transformation, the consumer has an ever greater choice of foods in line with his or her needs, values and expectations. In addition to safety, localism and responsibility, consumers are interested in the health-promoting properties of food. This is reflected in the popularity of blogs, online services and television programmes on the subject. Sensor technologies are also becoming cheaper and the development of smart packaging is helping consumers to reduce food waste due to spoilage.

Food producers must change their product portfolios to respond to the needs of individual consumers. To build comprehensive well-being services, we will need open-minded collaboration between sectors and must combine information from a range of sources.

By combining information, we can create, say, food services that support the well-being of the elderly or people with special dietary needs. In addition, nutrition could be connected to applications, such as activity bracelets, which monitor well-being. At VTT, we are developing the Snacktracker, which guides the user towards a more balanced eating rhythm.

Individualised food does not mean dining alone

The idea of individualised, customised food can conjure up alarming images of algorithm-controlled eating and the loss of human interaction. However, individualised food does not mean dining alone.

Food will still bring people together – individual choices do not mean living in a bubble. Choices are shaped by a community’s values and opinions; customised food can be eaten around the same table. Digitalisation offers new channels for community and sharing, in addition to face-to-face interaction.

Digital services such as HejaHeja and Facebook are among the big names in the creation of social networks. Through online communities, people seek to share their experiences with friends, acquaintances or other people with the same interests. Feedback and encouragement from a social network or experts are a key factor in motivating people to use digital food services.

Appreciation of home cooking and spending time with friends and family is growing. There are food services which promote these by providing personalised meal planning, varied recipes and online home delivery. Finnish services that make everyday life easier include for example Miils, Hellapoliisi and Sannan ruokakassi. Time saved on food shopping can be used for, say, cooking together.

Digitalisation brings us around the same table

Digitalisation brings people together around food, both locally and globally.

Airbnb has revolutionised accommodation services. It is a good example of digitalisation enabling a new breed of service. Similar services are also emerging in the food industry. Last year, Helsingin Sanomat reported on a new startup called Eataway, through which ‘Restaurant Day meets Airbnb’. This is a platform which brings together cooking enthusiasts with tourists and locals in search of good home cooking.

In Finland, Yhteismaa ry, which started out with a communal Cleaning Day event, has come up with an open-air dinner concept. The idea is to tempt people to eat around the same tables. This year’s aspiration is to have people participate all over Finland and make the open-air dinner an annual event.

Customer a participant in the development of future food services

Consumers can directly converse with manufacturers and personalise products and services online. Correspondingly, food producers can use tailoring to create added value for customers. Digitalisation also enables consumers to find information on product origin, production methods and transport conditions.

Online retail and improving logistics solutions are revolutionising the centralised food trade. To benefit from this change and develop consumer-based food services, the food production sector must acquaint itself with new business models.

Kaisa Vehmas VTT

Kaisa Vehmas, Senior Scientist 

Maria Åkerman VTT

Maria Åkerman, Principal Scientist 

Äärisääilmiöt ja ilmastonmuutos haastavat liikennejärjestelmämme

Säähän on vaikea vaikuttaa, mutta sen ääri-ilmiöihin voi varautua. Johtava tutkija Pekka Leviäkangas esittelee OECD:n varautumissuositukset kevään aikana blogissamme – tässä kolme ensimmäistä.

Taloudellisen yhteistyöjärjestö OECD International Transport Forum (ITF) julkaisi vuodenvaihteessa tutkimusraportin äärisääilmiöiden ja ilmastonmuutoksen aiheuttamista haasteista liikennejärjestelmälle, erityisesti liikenteen infrastruktuurille. Raportti Adapting Transport to Climate Change and Extreme Weather: Implications for Infrastructure Owners and Network Managers listaa yhdeksän toimenpidesuositusta OECD-maille, jotta haitalliset vaikutukset voidaan minimoida ja jopa neutraloida.

VTT on pääkirjoittajana raportin useassa luvussa, ja muutama vuosi sitten VTT:n koordinoiman EWENT-hankkeen tulokset ovat raportin tärkeä tietolähde.

EWENT-hankkeen tulokset osoittavat, että äärisäiden aiheuttamat vahingot voivat olla jopa 0,15% EU-maiden bruttokansantuotteesta. Joka vuosi!

Ensimmäinen asia, joka on tehtävä, on välitön reagointi: Act now!

Haasteet on tiedostettava nyt, ja on aika aloittaa välittömästi niiden pitkäjänteinen prosessointi. Pelkillä selvityksillä ja seminaareilla asiat eivät etene riittävän konkreettisesti.

Se, miten olemme liikennejärjestelmämme (samoin kuin monet muutkin infrastruktuurijärjestelmämme) suunnitelleet ja rakentaneet, perustuu vanhaan tietoon. Infrastruktuurit ovat elinkaareltaan sukupolvien yli ulottuvia perusrakenteita, joiden tulee kestää isältä pojanpojalle, jopa pojanpojanpojalle.

Liikenteen infrastruktuurit – satamat, rautatiet, lentokentät, tiet, kadut – tulee mitoittaa varautuen aiempaa voimakkaampien sääilmiöiden rasitukseen. Mitoituksen tärkein lähtökohta on perusrakenteiden sijoittelu. Tulvauhat ovat tyypillinen esimerkki. Jos liikenne katkeaa joka vuosi tai muutaman vuoden välein tulvivien vesien takia, jokin on pielessä. Samaan päänsärkyyn voi varautua tulevinakin vuosina ja vieläpä enenevässä määrin.

Ennakoivaan kunnossapitoon panostaminen on ehdoton edellytys osana varautumista: niitä rakenteita, jotka nyt ovat olemassa, on pidettävä kunnossa siten, etteivät säärasitukset vahingoita niitä ennen niiden luonnollisen elinkaaren päättymistä. Kunnossapito on yleensä halvempaa kuin uuden rakentaminen. Joskus saattaa olla paikallaan uusia kalliisti kunnossapidettävä ja uhanalainen perusrakenne.

Infrastruktuuribudjetit ovat niukat lähes kaikkialla maailmassa ja niinhän se on meillä Suomessakin. Niiden ylläpito toimintavarmassa kunnossa nielee yhä enemmän resurssejamme. Ellemme investoi ja ylläpidä nyt, lasku on tulevien sukupolvien kannettavana.

Toinen suositus: Varaudu entistä useammin toistuviin säiden aiheuttamiin ongelmiin ja paikoin koko infrastruktuurin pettämiseen

Jos kaupungin liikenne suuntautuu pääosin kokonaisuudessaan yhden käytävän tai sillan läpi, voi tuo pullonkaula osoittautua strategiseksi ongelmaksi. On syytä varmistaa, etteivät kaikki munat ole samassa korissa, vaan että vaihtoehtoiset reitit tai kulkumuodot ovat käytettävissä vakavienkin ilmiöiden osuessa kohdalle.

Tämä strategia ei päde pelkästään äärisääilmiöille, vaan myös muille uhkille, esimerkiksi terrorismiin tai vandalismiin.

Kolmas suositus: Tee valmiussuunnitelmat (business continuity planning)

Kun liikennejärjestelmä pettää, pitää tietää, mitä tehdä heti seuraavaksi, keitä kaikkia informoida ja mitä toimintaketjuja käynnistää. Kun Pohjanmaalla tulvii, tarvitaan pioneerit räjäyttämään jääpatoja. Suomalaisilla viranomaisilla on pääsääntöisesti hyvät valmiussuunnitelmat, ja paikalliset palo- ja pelastuslaitokset ovat hyvin tehtäviensä tasalla.

Mutta ovatko resurssit mitoitettu niin, että varaudutaan myös aiempaa useammin toistuviin ja intensiivisempiin ongelmiin?

Äärisääilmiöiden riski-indikaattori EU-27 alueella, ilmastoalueittain; kaikki liikennemuodot ja liikenteen infrastruktuurit kattava komposiitti-indikaattori. Suomi kuuluu vain yhteen ilmastoalueeseen, mutta esimerkiksi Puolassa on kaksi ilmastoaluetta, samoin kuin Ranskassa. Suomen riskitaso on matala. Indikaattoriin vaikuttavat muun muassa sääilmiöiden luonne ja tyyppi, äärisäiden todennäköisyys, liikennejärjestelmän ja infrastruktuurin laatutaso sekä maan tulotaso. Lähde: Leviäkangas, P. & Michaelides, S. Nat Hazards (2014) 72: 263. doi:10.1007/s11069-013-0970-x

Teknologia ja sen hyödyntäminen tärkeässä roolissa

Teknologian merkitys kaikissa yllämainituissa kolmessa strategisessa toimenpiteessä on suuri.

  • Tiedon välittämisen ja jakamisen teknologiat sekä arkkitehtuurit palvelevat koordinoitua yhteistyötä, jota tarvitaan äärisääilmiöitä kohdattaessa.
  • Perusrakenteiden ja ympäristön sensorointi sekä reaaliaikainen seuranta mahdollistavat aikaisen reagoinnin ja vahinkojen minimoimisen.
  • Riskienhallinnan menetelmät, systeemianalyysit ja skenaariotekniikat ovat työkaluja, joilla saadaan otetta resilienssin eli sietokyvyn ja toimintavarmuuden hallintaan.

Uskaltaisin sanoa, että tästä saisi hyvän suomalaisen vientituotteen, koska meiltä löytyy oikeanlaista teknologiaa ja osaamista.


Pekka Leviäkangas VTT

Pekka Leviäkangas, johtava tutkija

Esittelen OECD-julkaisun yhdeksän keskeistä toimenpidesuositusta kolmen blogikirjoituksen sarjana kevään aikana. Jokaisessa blogissa käyn läpi yksin tai yhdessä kollegojeni kanssa suositukset.

Extreme weather phenomena and climate change challenge our transport system

At the turn of the year, the Organisation for Economic Co-operation and Development’s (OECD) International Transport Forum (ITF) published a research report on the challenges posed by extreme weather phenomena and climate change to the transport system, the transport infrastructure in particular. The report Adapting Transport to Climate Change and Extreme Weather: Implications for Infrastructure Owners and Network Managers lists nine recommendations for OECD Member Countries for mitigating and reducing the adverse effects.

VTT Technical Research Centre of Finland Ltd was one of the main authors of several chapters of the report, and the EWENT project that VTT coordinated a few years ago served as an important source of information for the report.

The results of the EWENT project showed that the damage caused by extreme weather could account for up to 0.15% of the EU Member States’ GDP. Every year!

The first step to take is to react immediately: Act now!

The challenges must be acknowledged now, and it is time to start processing them in the long term at once. By means of reports and seminars alone the matters will not advance as concretely as they should.

The way we have designed and built our transport system (as well as many other infrastructure systems) is based on old information. Infrastructure refers to the basic structures with life cycles extending across generations that must pass from father to son, grandson, and even great-grandson.

The transport infrastructure – ports, railways, airports, roads, streets – must be designed preparing for strain caused by increasingly stronger weather phenomena. The most important starting point for such design is the location. For example, if there is hint of risk of flooding, seek for higher ground. If flooding waters stop traffic every year or a few years apart, something is wrong. One can be prepared to face the same headache in the coming years, and even in an increasing extent.

Investing in preventive maintenance is an absolute requirement as part of preparedness: the existing structures must be maintained in such a way that the stress of weather will not damage them before the end of their natural life cycle. Maintenance usually costs less than building new structures. Sometimes, however, it may be necessary to renew the threatened basic structures that require expensive maintenance. Searching and operationalising the optimal strategy is a complex process, where research will help.

The infrastructure budgets are scarce almost everywhere in the world, and Finland is no exception. Keeping infrastructure safe and functional is swallowing an increasing share of our resources. If we do not make the necessary investments and take care of the maintenance, the future generations will need to pick up the tab.

Second recommendation: Prepare for more frequent problems caused by weather, and even failure of transport infrastructure in certain places

If all traffic into and out of a city mainly takes place through one passage or bridge, that bottleneck may turn out to be a strategic problem. All eggs should not be put in one basket, but there should be alternative routes or modes of transport available even if serious phenomena hit the area.

This strategy does not apply to extreme weather phenomena only, but also to other threats, such as terrorism or vandalism. Also it is wise to have modal options – when rails fail, the roads must offer the alternative, and vice versa.

Third recommendation: Make business continuity plans

When the transport system fails, one must know what to do next, who needs to be informed, and which chains of action to launch. When there are floods in Ostrobothnia, army engineers are needed to blow up the ice dykes. As a rule, Finnish authorities have good business continuity plans, and the local fire brigades and rescue services are on the ball together with other actors.

But are the resources scaled in such a way that preparations have also been made for more frequently occurring and intensive problems?

Technology and its use plays an important role

Technology plays a major role in all the three strategic activities described above.

  • The technologies and architectures for disseminating and sharing information serve the needs of coordinated co-operation, which is needed when dealing with extreme weather phenomena. In some contexts, novel ideas such as block chains could turn out to offer new possibilities for information exchange.
  • Sensorization and real-time monitoring of the basic structures and environment enable early reaction and minimisation of damage. New asset management philosophies and tools are needed to make use of modern technology, old ways of thinking might not work.
  • Risk management methods, system analyses and scenario techniques are tools that provide means for managing resilience, or resistance and operational reliability. Decision-makers and analysts need to start using these tools for real, and not only for academic exercises.

I would dare to say that even if the threat of adverse effects sounds bad, the challenges ahead could provide Finnish know-how a new stepping stone – we have the right mix of technological and organisational competence.

More information

Pekka Leviäkangas VTT

Pekka Leviäkangas, Principal Scientist

I will present the nine key recommendations for action made in the OECD publication in a series of three blog articles during this spring. In each of the articles, I will discuss the recommendations personally or in collaboration with my colleagues.

How to accelerate innovations and new business?

Companies have been struggling with going to the market for ages and the problem has become even more relevant in the fast-changing technological environment. Acceleration is a combination of processes, tools and methods that help companies go faster to the right market. The Accelerate project is here to tackle these challenges – Senior Scientist Päivi Jaring explains how it happens.

Päivi Jaring VTT

Accelerating an innovation is much more than creating the technology – an innovation must go to the market. An effective go-to-market strategy identifies the ways to reach potential users quickly in order to get feedback of the product and its features and this way adapt to users’ needs and requirements.

Various methods such as lean and agile have been developed for speeding up the time-to-market and for validating the customer needs in early phase of development, but still more experimental approaches to rapidly validate the match between the market need and their innovative technology are still needed. In short: more knowhow and tools on acceleration are needed, and the Accelerate project was launched.

Accelerate research project for European technology companies

Accelerate, an ITEA3 project, took the challenge of enabling the adoption of acceleration knowhow by European technology companies by focusing on two goals: large scale knowledge transfer on acceleration, and the introduction of the so-called validated learning process that systematically searches for the technology-market match by validating it against the business model.

In Accelerate, a four-phase model for acceleration was developed. The four phases of acceleration – the idea, problem/solution fit, product/market fit and scaling phase – are presented in the figure below. In Accelerate, the four-phase model was used in creating services based on technological innovation, advanced processes and new software technologies. The companies found the model also very suitable for accelerating existing businesses activities.

The Accelerate project has created a lot of visibility for this highly relevant topic and had a significant transformational impact on several of the participating companies in the form of new spin-offs, products, business models, and organisational culture change.  Various tools, such as an acceleration platform as a meeting place for start-ups and investors, and an acceleration self-test were developed to help companies in their acceleration process.

Acceleration phases, Accelerate project

Four phases of acceleration.

A to-do-list for business acceleration

Lessons learnt from the work done in the Accelerate project and its use cases can be summarized in the following eight points for new business acceleration:

  1. Step outside to recognize the real problems your potential customers are facing.
  2. Make the whole acceleration journey with and for your users and customers.
  3. Act fast but also invest time on eliciting material from the problem space, competitors and indirect competitors. There needs to be a well-argued problem statement.
  4. Never stop with idea generation and small experimentations – also with regards to your business model.
  5. Use the power of social media in identifying problems, finding solutions, creating awareness and new markets.
  6. Test and find the social media channels suitable for you.
  7. Progressively select and use KPIs to track customer experience, business performance and learning to guide your journey to scalable business.
  8. Use acceleration tools & mindset and startup-like structures regardless of your company’s age and size.

The above points suit to companies regardless of their size and domain.

More information

Päivi Jaring, Senior Scientist
Twitter: @PaiviJaring

Creating Finnish sharing economy

How could Finnish companies succeed in the growing sharing economy markets? What kind of models are desirable from the whole society’s point of view? Most of us are already familiar with the sharing economy as a term – but we are still debating what it is in essence, or what it should be. These questions were discussed at the YHTE2017 seminar, held by VTT Technical Research Centre of Finland Ltd (see the Finnish seminar programme and presentation material in the Slideshare service).

VTT YHTE2017 seminar panel sharing economy

The panel discussion participants Elina Voipio, co-founder of Duara Travels,
Maria Antikainen, Senior Scientist at VTT, and Juho Makkonen,
co-founder and CEO of Sharetribe.

Sharing economy: communality or exploitation?

The tone of the public debate on the sharing economy has changed in a few years. In the beginning, many found the future visions offered by the sharing economy inspiring: moving from owning of things to sharing or borrowing would improve resource efficiency, and sharing services and things in peer network marketplaces would increase well-being and even communality.

In recent times, however, the potential problems related to the sharing economy have raised more and more discussion: unsafe and poorly paid gig work, poor consumer protection, tax evasion and, in case of Airbnb, the rise in rental prices in major cities. These conflicting views are well reflected in such headlines as “In the sharing economy, owning things is not the main thing” (Suomen Kuvalehti) and “The sharing economy is a cute name for exploitation” (Helsingin Sanomat).

It has added to the confusion that, as a rule, totally different operators, ranging from large global platform companies to swapping circles and time banks, have been lumped together under the heading of sharing economy. Fortunately, the terminology has begun to become more varied. For example, such gig work marketplaces as Uber and Task Rabbit fit better under the headings of gig economy or on-demand economy. On the other hand, operators that lay emphasis on social equality and shared management of resources can most accurately be described by such terms as solidarity economy or commons-based economy. It may also be necessary to consider whether it is sensible to lump together such actors as Uber and time banks under the same heading in the first place.

Well-being from the sharing economy?

According to a recent estimate, the value of the market related to the sharing economy will grow tenfold from 2016 to 2020, from slightly over EUR 100 million to EUR 1.3 billion (Ministry of Economic Affairs and Employment Report 9/2017, in Finnish). The impact of the sharing economy on the Finnish society will increase significantly. Therefore, from the perspective of well-being, it is quite a topical issue to consider what kind of sharing economy models generate broad-based well-being and how could we support them.

At the seminar, Pasi Mäenpää and Maija Faehnle from the University of Helsinki reflected on the public sector’s role in the steering of the sharing economy. We need reforms in such matters as taxation, regulation and the basic security system to prevent the unwanted development paths from spreading and to help the desirable ones flourish. Last year, the European Commission and Parliament published several reports and analyses on the sharing economy, such as A European agenda for the collaborative economy, instructions on how to apply the EU legislation and a report on the situation of workers in the collaborative economy. However, on the public sector the work is just about to begin.

Naturally, the well-being is also affected by what kind of companies emerge in the sector and what kind of social ‘visions’ they offer with their activities. The seminar presented Finnish companies with not only genuinely novel, but also socially interesting offering. For example, Duara Travels offers accommodation and cultural experiences in developing countries in the homes of ordinary people. With the help of the technology offered by Sharetribe, almost anyone can establish an ‘every man’s sharing platform’. It is also used by the tool rental service Liiteri, which was piloted with VTT involvement. Futhermore, RobinHood Coop, which best fits under the description of commons economy, offers cooperative asset management services (see.

Debate and development work will continue through a new network

At the end of the seminar, on the basis of ‘public demand’ a decision was made to establish a research and development network of the sharing economy. So far, more than 80 members have registered to the network, including people interested in the sharing economy from the research world, citizens’ movements, and the private and public sectors.

The seminar was organised by Accelerate project,
Twitter: @AccelerateProj

VTT Katja Henttonen

Katja Henttonen, Specialist
Twitter: @katjahenttonen

VTT Maija Federley

Maija Federley, Senior Scientist
Twitter: @maijafederley