Digital Innovation IN5211 INFORMATION SYSTEMS Bendik Bygstad Professor Dept. of Informatics, UiO Professor II at Norwegian School of Economics SEPT 23, 2020
Learning outcomes First session: Digital business innovation • Understand the concepts digitalization, digital innovation and digital transformation • Understanding digital strategy Second session: Digital innovation in non-commercial contexts • Explain Commons Based Peer Production • Analyse generification of software Core reading Bharadwaj et al (2013) Gizaw, Bygstad and Nielsen (2016) Supplementary reading Staring and Titlestad (2008) Svahn et al. (2017) Bygstad 2020
A paradigm shift in research after 2007… • From IT to digitalization • From IT strategy to digital business strategy • From innovation with IT to digital innovation What happened in 2007? Bygstad 2020
Some key terms Digitization Description • Digitization: Converting analog information to digital • Digitalization: Using digital technology to change socio-technical structures • Digital innovation: Recombining digital (and physical) elements in new ways Digitalization Digitial • Digital transformation: Significant changes in ways of producing/consuming, which over time innovation transforms organizations, industries or society. Sources • Yoo et al., 2010 Digitital • Bharadway et al., 2013 • Osmundsen at al, 2018 transformation • Svahn et al. 2017 • Wessel et al., 2020 Bygstad 2020
Digital innovation • What is innovation? • What is digital innovation? • Is digital innovation different than non-digital innovation? • How does digital innovation transform organisations and society? Bygstad 2020
Digital innovation Q A? What is innovation? (and invention?) What is digital innovation? Is digital innovation different than non-digital innovation? How does digital innovation transform organizations and society? Bygstad 2020
Digital innovation Q A What is innovation? New combinations of elements to create something that has value for a customer What is digital innovation? Recombinations of digital (and analog) components to create… Is digital innovation different Se next than non-digital innovation? How does digital innovation Examples? transform organizations, sectors and society? Bygstad 2020
Product Innovation vs Digital Innovation Svahn and Bygstad, 2020 (forthcoming) Bygstad 2020
Some new perspectives… Digital innovation should be understood in terms of: • Agential core: acting in current social and business settings has become fundamentally different as the scope and range of affordances of digital technologies have changed and are continually changing, forming new types of joint agency. • Semiotic binding: Actors in different contexts will invent alternative ways of binding the code and data. • Ontological reversal: Digital technologies do not represent, but shape reality. (»Digital first».) Satish Nambisan, Kalle Lyytinen and Youngjin Yoo. (2020) «Digital innovation: towards a transdisciplinary perspective». In Handbook of Digital Innovation. Bygstad 2020
From IT strategy to Digital Business Strategy Bygstad 2020
Digital Business Strategy Bygstad 2020
Digital Business Strategy Description Dimension Scope of Digital • Digital Business Strategy Transcends Traditional Functional and Process Silos • Digital Business Strategy Includes Digitization of Products and Services and the Business Information Around Them Strategy • Digital Business Strategy Extends the Scope Beyond Firm Boundaries and Supply Chains to Dynamic Ecosystems That Cross Traditional Industry Boundaries Scale of Digital • Rapid Digital Scale Up/Down as Strategic Dynamic Capability • Network Effects Within Multisided Platforms Create Rapid Scale Potential Business • Scale with Digital Business Strategy Will Increasingly Take Place under Conditions Strategy • of Information Abundance • Scale Through Alliances and Partnerships Speed of Digital • Speed of Product Launches • Speed of Decision Making Business • The Speed of Supply Chain Orchestration Strategy • Speed of Network Formation and Adaptation Sources of Value • Increased Value from Information • Value Creation from Multisided Business Models Creation and • Value Capture through Coordinated Business Models in Networks Capture • Value Appropriation through Control of Digital Industry Architecture Bygstad 2020
Discussion point: • Is the framework of Bharadwaj et al. suitable for all kinds of organisations? Bygstad 2020
Part 2: Digital Innovation: Commons Based Peer Production Benkler and Nissenbaum (2006) Bygstad 2020
Digital Innovation: Commons Based Peer Production • “A socio-economic system of production that is emerging in the digitally networked environment. • “ Facilitated by the technical infrastructure of the Internet, the hallmark of this socio- technical system is collaboration among large groups of individuals, (..), who cooperate effectively to provide information, knowledge or cultural goods without relying on either market pricing or managerial hierarchies to coordinate their common enterprise". • Thus, the core characteristics of CBPP consist of I)decentralization, where individuals act as they see fit, without a central organizer, and II) the use of social cues and motivations, rather than prices and commands. • Example: Wikipedia Benkler and Nissenbaum (2006) Bygstad 2020
Digital Innovation: Free and Open Source Software (FOSS) FOSS: • The terms Open Source and Free Software both designate "Software that comes with source code and a usage license that allows for modification and further redistribution of the source code by any user" (von Krogh et al 2003), • The former emphasizing practical advantages of openness, and the latter the ethical Staring and Titlestad (2008) Bygstad 2020
Case: HISP (Health Information System Programme) • World leading ehealth program • 65+ countries • Started at UiO and South Africa in 1990s Bygstad 2020
Bygstad 2020
Digital Innovation: Open Generification Generification: The supplier strategy of taking a technology that has worked in one place and attempting to make it work elsewhere, and, in principle, ‘everywhere’. (Pollock and Williams, 2010) Open generification: A configuration of social and technical actors through processes of embedding and disembedding (Gisaw et al, 2016) Gizaw, Bygstad and Nielsen (2016). Open Generification: A Design Strategy for Health Information Systems in Developing Countries. Information Systems Journal. Bygstad 2020
HISP: Key lessons in a FOSS innovation programme • Excess capacy • Modularity • Integration and cultivation • “Snowflake topology” • Open generification Bygstad 2020
Summing-up Digital innovation: Bharadwaj • Commercial, company-centric • Commons Based Peer Production Benkler Gisaw, HISP, UiO Bygstad 2020
Discussion points: • Why do initiatives such as Wikipedia work…? • What is the key difference between commercial digital strategy and CBPP? • Can they be combined? Bygstad 2020
References • Bharadwaj, A., El Sawy, O. A., Pavlou, P. A., & Venkatraman, N. (2013). Digital business strategy: toward a next generation of insights. MIS Quarterly, 37(2), 471-482. • Gizaw, Bygstad and Nielsen (2016). Open Generification: A Design Strategy for Health Information Systems in Developing Countries. Information Systems Journal. • Svahn, F., Mathiassen, L., and Lindgren R. (2017). "Digital Innovation in Incumbent Firms: How Volvo Cars Managed Competing Concerns". MIS Quarterly, 41(1), pp. 239-253 • Staring and Titlestad (2008). Development as a Free Software: Extending Commons Based Peer Production to the South. ICIS 2008. • Satish Nambisan, Kalle Lyytinen and Youngjin Yoo. (2020) «Digital innovation: towards a transdisciplinary perspective». In Handbook of Digital Innovation. Edward Elgar Publishing. Bygstad 2020
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