How can industry be included in the sharing economy?

With the success of innovative ventures such as the carpooling platform BlaBlaCar, and the shared office environment WorkAround, the sharing economy is turning into a booming business for B2C. The concept of sharing  goods and services is perfectly suited to consumers who would rather handle their business themselves than go through a middleman. But how would it be possible to get the B2B sector involved?

The Ministry of Economic Affairs and Employment estimated that the sharing economy in Finland will be worth (TEM 9/2017) 1.3 billion euros in 2020. Based on the report, the biggest sectors are crowdfunding, peer-to-peer mobility and car sharing, and household management and other micro tasks.  These calculations are strongly based on the current situation in which the sharing economy is mainly B2C business. However, there is one area that seems to be lagging behind B2C when it comes to the sharing economy: B2B.

 

Sharing economy refers to a common or communal economy that includes the production, consumption and use of commodities. It is based on temporary access instead of ownership, by utilizing the development of technology and the popularity of social media, such as sharing platforms. Since the B2B sector does not function on the same peer-to-peer business model that suits B2C, it makes sense that this sector has not yet seen as much success in the sharing economy. Different drivers, such as the economic situation, facilitate the need to share. Furthermore, change of mindset and existing practices in companies towards the sharing economy require progress, which can be challenging and take time. However, as technology develops, the B2B sector is looking to evolve in a way that will also allow it to partake in the lucrative sharing economy. The long-term vision is that current industrial value networks will evolve into business ecosystems in which the resources of individual companies can be shared on demand, making the network more responsive and efficient.

Platforms as enablers

The platforms are enablers for the B2B sharing economy. New business rules of the platform economy include generating network value, enabling of scale-up, and asymmetric competition in which companies pursue market opportunities with different resources and approaches. The ideal platform ecosystem in the B2B sharing economy includes 1) external resource orchestration instead of controlling internal resources, 2) external interactions between producers and customers instead of internal optimization, and 3) focusing on ecosystem value instead of on individual customers. The sharing business models are often triadic models consisting of a service enabler (platform), a service provider (supply / owner) and the customer (demand / seeker).

share_eng

Unique business models that maximize the utilization of idle assets differentiate the sharing economy from traditional business models. Most sharing economy businesses use online platforms or applications for collecting and sharing real-time data, and maximizing the use of assets. Based on the platform guidelines, digital leaders design and optimize platform ecosystems that scale exponentially without incurring the diminishing returns typically associated with traditional business models. The shift towards sharing economy business models is a big step for traditional companies, and new knowledge is needed to advance the transformation.

Benefits and challenges in the B2B sharing economy

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SHARE -research project

B2B sharing economy in the industrial context is researched in the SHARE -research project. The aim of the project is to create and demonstrate a digital sharing platform concept for a circular economy business ecosystem in which collaborating industrial organizations can easily co-innovate and share knowledge, production capacity, resources, services and logistic networks through interoperable systems, connected intelligent objects and blockchain technology. We are designing a set of rapid experimentations and initial solution designs for a sharing economy platform, testing and analyzing the designed solutions and analyzing in-depth sharing economy experiments. We are also organizing a series of workshops for advancing sharing economy knowledge and solutions, and analyzing business potential opportunities and business models.

For more information, please visit: www.vtt.fi/share

Salla Paajanen
Research Scientist, VTT
salla.paajanen(a)vtt.fi
Twitter: @PaajanenSalla

Anna Aminoff
Senior Scientist, VTT
anna.aminoff(a)vtt.fi
Twitter: @AminoffAnna

Maria Antikainen
Senior Scientist, VTT
maria.antikainen(a)vtt.fi
Twitter: @MariaAntikainen

This is the first text of a blog series addressing topics related to the SHARE -research project.

Alustat eivät ilmesty tyhjästä!

Kohti uusia ja radikaaleja liiketoimintamahdollisuuksia digitaalisilla alustoilla: Ei ole olemassa yhtä ainoaa tietä menestykseen vaan reittejä on monia!

Alustojen ytimestä löytyvät tuotteet ja palvelut, jotka liittävät toimijat yhteen – kohti saumattomia asiakaskokemuksia. Nämä saumattomat palvelukokemukset tuottavat tietoa, joka voi jaettuna, integroituna, tai analysoituna luoda uusia liiketoimintamahdollisuuksia alustan omistajalle ja liiketoimintakumppaneille.  Useiden alustojen ja niiden digitaalisen vuorovaikutuksen rajoja ylitettäessä syntyy lisää tietoa – laajaa dataa – joka mahdollistaa monimuotoisen tiedon integroimisen. Haluamamme radikaalisti uudenlaiset liiketoimintamahdollisuudet odottavat eri tietoaineistojen ja tietolähteiden yhtymäkohdassa. Mutta kuinka tavoitteeseen päästään?

Digitaaliset alustat ovat paikkoja digitaaliselle kanssakäymiselle ja ne koostuvat erilaisista arvoa tuottavista rakennuspalikoista.  Näiden rakennuspalikoiden on toimittava yhdessä! Niin kutsuttujen rajaresurssien täytyy mahdollistaa saumaton tekninen ja yhteistoiminnallinen vuorovaikutus. Jos siis tarjoamasi saumaton asiakaskokemus hyötyisi täydentävistä mikropalveluista (microservices), niin niiden tulee olla käytettävissä ratkaisuunne yhteensopivien ohjelmointirajapintojen (API) kautta.

Tarkistuslista

Jos et ole tutustunut alustaratkaisujen vuorovaikutuksen ja rajaresurssien tärkeyteen, ota ensimmäinen askel oheisen tarkistuslistan avulla! Se perustuu tutkimustyöhön, teollisuuden ja muiden sidosryhmien näkemyksiin ja kokemuksiin sekä Suomessa että muualla.

  • Mikä on se ongelma, jota olette ratkaisemassa alustoilla?
  • Millaiseen vuorovaikutukseen haluatte osallistua?
  • Mikä on vahvuutenne?
  • Oletteko valmiita globaaliin toimintaan?
  • Missä kohtaa digitaalista evoluutiota olette tällä hetkellä?
  • Oletteko määritelleet tekniset ja yhteistoiminnalliset resurssinne?
  • Miten osaatte tarttua ohjelmointirajapintojen tarjoamiin liiketoimintamahdollisuuksiin?
  • Miten osaatte tukea ei-teknisiä rajaresursseja?
  • Mikä on skaalattavuustavoitteenne?
  • Onko teiltä datastrategia?
  • Millainen on alustanne ekosysteemi?
  • Millainen toimija haluatte olla perustuen resursseihinne ja verkostoasemaanne?
  • Oletteko miettineet asemaanne alustaekosysteemissä?
  • Tiedättekö mistä lähteä liikkeelle – ja kuinka edetä?

Lisätietoa aiheesta löytyy julkaisusta: Platform Economy Interactions & Boundary Resources

Ajattelun muutos

Digitaalisten alustojen myötä pelin logiikka on muuttunut, eivätkä kaikki toimijat voi omistaa tai tarjota alustoja. Ei siis ole olemassa yhtä ainoaa tietä menestykseen!

Tutustu myös aiempiin alustoja koskeviin postauksiin:

Alustaekosysteemi määrittelee uuden talouden keskeiset tekijät

Avoimuus on avain alustatalouteen

Kaikki liittyy alustoihin – ja alustat kaikkeen

 

Katri Valkokari
Katri Valkokari
Tutkimuspäällikkö, VTT
katri.valkokari(a)vtt.fi

 

marko-seppänen-3
Marko Seppänen
Professori, TUT
marko.seppanen(a)tut.fi

 

vttblog_kaisa_still_marko_seppanen_katri_valkokari_crop
Kaisa Still
Erikoistutkija, VTT
kaisa.still(a)vtt.fi

Finland could be the next Silicon Valley: Lessons from Silicon Valley – speed, flexibility and boldness

piilaakso

Silicon Valley is a great place to see first-hand how technology can be turned into success stories. As a small, pilot-scale country and a pioneer in digitalisation, Finland is in an excellent position to take advantage of the growth opportunities presented by technological development.

I had the pleasure of attending the Silicon Valley Experience 2017 event in September. The momentum there is certainly mind-blowing. And thankfully also inspiring. I want to take this opportunity to share my experience with you and draw a few comparisons between the atmosphere in Silicon Valley and Finland’s current situation and possibilities.

Time is not your friend in innovation

Are we quick enough and does our culture encourage experimentation?

Finland has given birth to a wonderful start-up culture, with organisations such as Aalto University leading the way through the transformation. Thumbs up to them. We are on the right track. However, we need to be bolder and throw ourselves into new things even faster and on a more international scale.

How can we inject this same enthusiasm into larger corporations as well?

We were introduced to the philosophy and business of two Silicon Valley enterprises that still consider themselves start-ups. Google and Facebook are both growing at a rate of tens of thousands of employees per year. However, their corporate cultures are firmly rooted in open-minded experimentation, and the staff are led on the basis of targets and results, not procedures.

In our own work community, we made a decision to devote even more energy to the cultural transformation:

  • Setting ambitious goals and making sure that they are reached, but with freedom in the implementation.
  • Fewer written plans and reports.
  • More flexibility, learning and choices.
  • The first step was a decision taken by VTT’s management team there and then to radically revise the way we approach innovative research.

Thumbs up to us! 🙂

I am personally very keen on the idea that you need to be leaning forward by so much that you have no choice but to run. Otherwise you fall flat on your face.

Pay it forward

Would we Finns be able to work together in a new way?

In Silicon Valley they believe that altruistic good deeds come back to you when needed.

We know that there is immense potential in new ecosystems, i.e. organisations’ partnership networks, and their disruptive value networks. This refers to new technology that transforms business and markets by making old technology, techniques or business models redundant. As a small, pilot-scale country and a pioneer in digitalisation, Finland is in an excellent position to take advantage of these opportunities. This requires the courage to put enough data into circulation.Think about all the new start-ups and services that could be found in the gaps! Surely everyone, or at least enough people, would ultimately win. I cannot see anyone suffering great losses in any case.

Are we bold enough to throw ourselves in with different partners and see what happens? Without demanding too linear and short-term a return – paying it forward.

Artificial intelligence changes everything: “50% taking action”

Artificial intelligence, machine learning and virtual reality. Almost every message centred around these concepts. Silicon Valley is a firm believer in the role of new technologies in bringing about the next big transformation since the internet.  This is evident in absolutely everywhere.

To summarise a lesson from Google: 1.7 megabytes of new data are created every second for every person on the planet. By 2020, the speed of data creation will be 44 times greater than in 2007. While today the focus between data accumulation, reporting and analysis is split at a ratio of 50/40/10, in the very near future “taking action” will account for 50% and data accumulation and reporting for only 20%.

Finland’s big chance definitely lies in applying artificial intelligence. Google alone spends more than Finland’s national budget on the development of core artificial intelligence technologies. We have strong domain know-how (e.g. autonomous systems, smart energy, health, the forest value chain). We are top experts and users of digital technology, and we have a culture that fosters broad-based cooperation.

How could we create an opportunity for world-class innovation ecosystems that are carried by a culture of experimentation to be born in Finland? How could we give just enough support to networks to overcome the initial friction and get moving? We already have the building blocks. Innovation ecosystems are practice platforms. Now is the time to launch them!

The focus of Silicon Valley has widened, and the cost of being based there has got out of control. This could be a sign of an approaching Big Bang. How about we get our hooks in now? And not wait until tomorrow. Finland could be the next Silicon Valley!

A big thank you to Boardman and #SVExperience17 for the wonderful Silicon Valley 2017 experience!

Erja Turunen VTTErja Turunen
Executive Vice President, Smart Industry and Energy Systems
Cell +358 50 380 9671
erja.turunen@vtt.fi
Twitter @turunen_erja

Has a new money spinner been found – can big data be turned into business?

A few weeks ago, Mika Toikka, Vice President, Sales and Business Development, reminded us in our blog how big data provides a multitude of answers, but you also need to remember to consider your questions carefully. Research Manager Katri Valkokari continues on the same subject, presenting different business benefits big data could offer.

Data is the new oil, and the possibilities of data economy are limitless. However, to seize the opportunities you must be able to identify the data that is essential for your business operations from among the data available via various sources (e.g. IoT data, customer/CRM data, service log data, data from public sources).  In addition, you need understanding of the validity of data and the possibilities of analysing it from the perspective of both the company’s internal and the customer’s development needs.

Even more important for finding new opportunities is asking the right questions, asking why and what kind of data or information you need, what you are aiming at with the data and where can you acquire the data you need. You should also boldly consider what you do not yet know, and thus identify which data you are still missing and what kind of new data sources could be used.

To find new business opportunities you rather need to combine several different data sources than more of similar data or deeper analysis of the existing one. In other words, you should consider wide data in addition to big data. In Figure 1, the process of use of data summarises the main phases that explain why data is needed (understanding the current state and forecasting the future trends), and how and for what it is used (choices and decision-making).

Use of big data

 

When the strategic goal for use of data is to identify new business opportunities, the viewpoints for questions and answers presented in Figure 1 include the following:

  • Increasing customer understanding and finding leads
  • Identifying potential customers and markets
  • Forecasting trends within the sector and collecting competitor information, as well as forecasting the future customer needs
  • The benefits provided by use of various data sources for the identification of new innovations or business opportunities
  • Development of the processes for use of internal data

Katri Valkokari VTT

Katri Valkokari
Research Manager
Twitter: @valkatti

Good Life for Finland – Time to launch a health data & AI ecosystem in Finland

Health data

An American serial entrepreneur and investor Bill Gross gave a popular TED Talk in 2015, in which he stated that timing is the single most important reason for startups to prosper. Perfect timing was the main reason in the successes of Uber, AirBnB, YouTube, and LinkedIn. As examples of failures Gross mentioned e.g. the food delivery service Webvan and the social media pioneer Friendster, both of which entered the market a bit too early. Launching too late doesn’t work either, since the market has already been conquered by others.

Nailing the perfect timing concerns businesses beyond startups. It is also very vital in research and the commercialization of research results. Research groups should have their eyes and ears open for trends in consumer behavior, legislation reforms, and technological innovations.

Finnish health data into use

We are now in the verge of such pivotal moment in the area of health data. From spring 2018 onwards, a new EU GDPR legislation is going to be in effect. GDPR is going to enable a secondary usage of health data. By virtue of this new legislation health data can be utilized in research a lot better than earlier. At the same time, The National Institute of Health and Welfare is going to become a governmental body granting permissions for data usage (link in Finnish).

Why should this be of interest to Finland and the Finnish research and business scene? First of all, Finland already has top quality research in and around the health sector. Furthermore, Finland has excellent ICT know-how and applying artificial intelligence (AI) is supported by the government (link in Finnish).

An even more significant reason, however, is the fact that Finland has a unique health and genomic data population. Health registries have been in use for long and one can get into hospitals with the same credentials across Finland. In this sense Finland is one of a kind.

Added value for health care

The government stated in their midterm resolutions, that the ecosystem model is the way to go in order to speed up digitalization (link in Finnish). Clearly one of the most important ecosystems is in the area of health data and ICT: “Good Life for Finland”. Last spring a strategic research agenda (SRA) in this area was prepared by VTT together with companies and research institutes. The SRA lays out the most significant priorities of the area.

As a unique health data possessor Finland has the opportunity of attracting also international stakeholders to this new ecosystem. We can provide a testbed for validation of research results and trying out new innovations before global launches. In other words, the ecosystem model of operating benefits both research and business, domestic and international alike.

And what’s most important, all these findings and innovations will in the end result in decrease in diseases, increase in life expectancy, less costs in healthcare, as well as overall growth in wellbeing.

All the puzzle pieces are at hand for completing the ecosystem. VTT is already starting operations for reaching the SRA goals. Now is the time to act for making the most of what health data can offer us!

Tua Huomo VTT

Tua Huomo
Vice President, Data-driven solutions VTT
Twitter: @tuajh

Industrial renewal is upon us – be bold and gain a foothold!

Digitalisation, automation, IoT, AI, blockchain, 3D printing – I could continue the list with quite a few juicy terms. How many times have you read or heard one of these words during the last week? I dare to wager that it was quite a few. Certain themes rise to the surface and remain a topic for discussion, until a new trendy word rises to everybody’s lips. Instead of using inordinate amounts of time and energy around an individual concept or technology, we should shift our focus to the change taking place in the big picture and to what kind of a future we could create with the help of various technological enablers.

New trends force changes upon the current operations

Automation and robotisation alone are not enough to answer the challenges placed on companies by the global market and the increasingly demanding customer needs. Companies have no choice but to draw parallels between their development and, for instance, the following trends:

  • Smart products, production systems, production and delivery chains;
  • Renovation of the design of products and production through digitalisation and automation;
  • Need-based production, real-time delivery chain, distributed production;
  • Robotisation and flexible automation combined with artificial intelligence;
  • Service business with (or without) the help of digitalisation; and
  • Industrial ecosystems and platform economy.

I believe in the claim that the smart products and services of the future will be created in new industrial ecosystems supported by a globally connected platform economy. The leap from today to this vision seems wild, and the ability of companies to see the steps they need to take can be limited, when there is no concrete action plan available. It is therefore gratifying that we can find examples around us where a company’s own desire for development launches a networking project full of growth potential.

Expand your operations with the help of industrial networks

When a Finnish medium-sized machine manufacturer wishes to broaden its offering in order to speed up its growth in the global marketplace, the traditional model is to start planning business acquisitions. It would be more agile to avoid the risks and slowness of acquisitions by establishing a network structure, where a number of companies linked to the sector in question commit to creating a shared offering.

For global customers, this network appears as a seamless entity, while inside it, different actors work according to their own core competencies and deliver their share of the total. In this model, the success comes from working together, challenging each other within the network and obtaining help from select key customers.

Automation streamlines and adapts production

The radical renovation of design, manufacturing and service business with the help of digitalisation builds competitiveness and business opportunities for the industry also in countries with traditionally high cost structures. Robotics offers various solutions for making production more efficient and increasing productivity in the manufacturing industry.

However, it is not a question of robotisation only; an industrial company must be able to increase its agility and flexibility in order to create solutions that maximise the customer benefit. New manufacturing processes and the delivery chains built around them will bring customer-specific solutions up to a level we have not yet seen.

Thus far, automation has mostly been linked to equipment and production processes. However, the real leap in productivity will take place at the systemic level, where the entire delivery chain is examined, boldly questioning the current operating models. Must a company producing products have its own manufacturing capacity, or could it connect to a network of manufacturing plants and commission the manufacturing of the products from the plant that is most optimal to the need? On a longer term, one could think that this kind of a system is self-learning and able to adapt to the production needs of the owner of each brand. Once again, these are major questions from the perspective from the Finnish manufacturing industry; after all, we wish to ensure that we have strong connections to the future network models.

We help companies realise bold and ambitious visions

VTT possesses strong competence in the above-mentioned themes of industrial renewal, and even now, we are involved in enabling the birth of several industrial networks. In addition to technological research and development, we are a natural and competent partner also for the creation and organisation of new ecosystems.

Mika Toikka VTT

Mika Toikka
Vice President, Sales and Business Development
(Smart Industry and Energy Systems)