Living Labs As a Tool for Open Innovation: a Systematic Review

Special Issue INTERNATIONAL JOURNAL OF HUMANITIES AND March 2016 CULTURAL STUDIES ISSN 2356-5926

Living Labs as a Tool for Open Innovation: a Systematic Review

Ali Yazdizadeh1,*, Ali Tavasoli2 Institute for Management and Planning Studies (IMPS), [email protected] Allameh Tabataba'i University, [email protected]

Abstract

In recent years, one of the important issues in open innovation is the concept of “Living Lab”. While developing innovation, there is a growing interest in users partnership for innovation development processes. One way to structure and conduct this partnership for R&D processes is a living lab. Since it is rather new in different fields such as ICT developments, rural improvements, and health services, the living lab is difficult to illustrate. Nowadays living labs are confronted with lack of a common concept in open innovation. This paper presents a systematic review of the living lab in order to gain a complete understanding of it and its ability to innovate and development. The results show that living lab can improve production, and communication industry, academia, government and increasing national economy.

Keywords: Open Innovation, Living Lab, User-centered innovation.

1,*- MA Student, public administration 2 - Candidate of PhD, Technology Management http://www.ijhcs.com/index.php/ijhcs/index Page 1681

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1- Introduction Innovations resulted from reclusive companies. The most positive effect on innovation generated from networks of different kinds of colleagues (Nieto & Santamaria, 2007; Zeng, Xie, & Tam, 2010). Innovative networks need various resources to be effective, Also the ability to generate different relationships to develop a company's innovation capacity which is so important (Calia, Guerrini, & Moura, 2007). So, innovation networks has an increasing orientation to use an open innovation model that includes more factors and activities in a comparison with a traditional model (Van de Vrande, de Jong, Vanhaverbeke, & de Rochemont, 2009). Open innovation provides a substitution for a usual development (Chesbrough, 2006) & its advantages are users value improvement (Almirall & Casadesus-Masanell, 2010), better innovative performance (Chiaroni, Chiasa, & Frattini, 2010). Living labs, are innovative networks based on open innovation philosophy .They found on this base that companies should consider the ideas from foreign resources for develop and commercialize the innovation, (Almirall & Casadesus-Masanell, 2010; Gassmann, 2006).Despite observing the life lab as a new form of It and communication innovation (Følstad, 2008; Herzog, Boronowsky, Rugge, Glotzbach, & Lawo, 2007), open innovation development tool (Almirall & Wareham, 2008; Kviselius, Andersson, Ozan, & Edenius, 2009), or open innovation network (Leminen, Westerlund, & Nyström, 2012; Romero & Molina, 2012(, the researchers are agree about the main role of user in innovation process (Almirall &Wareham, 2008; Følstad, 2008; Leminen et al., 2012; Schuurman, De Moor, De Marez, & Evens, 2011). Also, users are participating in living lab equally by using different factors in networks (Edvarsson, Gustafsson, Kristensson, &Witell, 2010). Also the living lab can be known as physical are as or virtual realities that all beneficiaries of public-private-people partnerships (4ps) and co-operators from companies, public organizations ,universities, institutions and users who cooperate with each other to generate the basic form and its credit. Also the technology, services, products and modern systems evaluation, can be part of this definition in real life text (Westerlund & Leminen, 2011). In living labs, users, form & use the innovation in daily life environments, though it will see in traditional innovation networks or labs, or users and their views will use and interpret by knowledgeable people (Almirall, 2009). Users are acting not only as information resources, but they act as innovation examiner, developer and designer based on equal to others in living labs (Nyström, Leminen, Westerlund, & Kortelainen, 2014). 2- Research Methodology: (Systematic Review) In this article the systematic Review method has been used. The systematic history has four steps as the following:

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2-1 Question Design Recent article wants to know the answer of this question "what is the meaning/ concept of living lab? or can its complete comprehension and ability to innovation and develop lead to product and manufacture's progress and finally national economy? This systematic Review is by using history investigation of this topic in scientific articles. 2-2 Recognizing related articles and publications For finding English articles about living labs, keywords such as open innovation ,living labs user-oriented innovation, co-creation value were searched in database Google scholars which includes many publications and more than 200 related articles found, then after using protocols (from magazine & Journals validity & time setting) and investigating the article's abstract generally 48 articles were investigated. 2-3 Evaluating the quality of Researches In this step search protocols were used based on this for selecting the most authenticated articles: - Choosing articles among valid databases and referring above. - The articles which are published between years 2005-2016. 2-4 Findings report In this step the researchers try to gather the topics about concept of living lab and select subjects that has the most sharing and importance in articles and finally to express the living lab concepts and other key words &related variables and answer to the study's question. 3- Theoretical base Henry Chesberu introduced the open innovation theory in Berkeli California university for the first time. Chesberu present open innovation as an important factor to reach benefit in technology and expressed that how organizations invest in research & development, for a long time in recent era, use people with high abilities that able them to develop their innovation ideas and support them by though ownership strategies and invest the resulted profit again in research& development living lab (Chesbrough, 2006). The concept introduced by professor William Michel in 1995 from Media lab of MIT university and architecture college and city programming .At first explains the living sample observation from users in an intellectual condition for a period of time (Eriksson et al., 2005). (Media Lab is a cross-disciplinary research lab in MIT university that allocates to technology, multimedia, science, art & design convergence project). Its employees & student have different fields from electrical engineering, computer science to sociology & music (media university site, MIT University). The main idea of living lab was structuring the environment like house by around available and intellectual IT such as wireless technologies and sensitive sensors and first design &confirming the complicated solutions of communication & information technology (Ståhlbröst, 2008(. Samples are living labs includes Gorgia technology institution and local lab in MIT (Intille et al., 2005). After that this concept develops to a general axis of a user open innovation approach (Ståhlbröst, 2008). Today, in Europe, a continuous procedure is doing that try to proportionate the living lab in extensive usage to increase innovation, capacity profitability and usibility of

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information and communication technology and its application in society (Eriksson et al, 2005) .There isn’t any cohesive definition about living Lab, although some people have expressed their own definitions. Continuously, some samples of these definitions are expressing for high diversity presentation, and finally a suggestive definition has expressed There are many different definitions about networks. The European union projects and financial providers of research projects are a methodology for user-oriented innovation and organizations that use it in first level based on ENOLL, though, European project core labs define it as a system to able people, user & service/product users to have an active role as a co-creators in an innovative procedure, development, research (Bergvall- Kåreborn et al, 2009). Living lab is a long term social structure or resource instead of contacts to a special project. In this structural the framework, experiences, procedures and conditions are made for developing the innovative idea, Some researchers present some other definition: From methodology view, Erikson et al (2005) believe that living lab points to a development and research method that the innovations like services, products or programs in multidimensional and real life environments (Eriksson et al, 2005). Although they present a good & comprehensive from living lab but their definition flaw is in lack of methodology steps descript description of living lab. Ballon et al (2005) define the living lab as a test environment that from the technology in different fields of real life and users are as "coproducers". In addition, Feurstein et al (2008) describe the living lab as a systematic innovation view that all beneficiaries are cooperating in one product or program in a development process, directly. So the concept of living lab can be seen as a method, an organization, a system, field, an environment or systematic innovation approach. Bergvall- Kare bornetal (2009) demonstrate a comprehensive definition in this field based on their experiences, and expressed that a living Lab is an environment (environment, field) and approach (Methodology or innovation procedure). Moreover they founded their definitions based on living lab’s certified parts and principles. Also their definition is as the following: "Living lab, is an user-oriented, innovative environment which is made based on routine exercise & research, with a procedure with the purpose of generating permanent value, facilitates the user’s influence on open innovation process and involving all related partners in real life environment". For methods and living lab tool’s aspect there is a broad literature. The first living lab such ad “Aware Home & placelab” present a method similar to home IT tool & available communications. Shumacher & Feurstein (2007) present a general view of uses methods and tools in service development process and existing products in Europe. Cross- disciplinary methods have used in living lab different projects. For example each both method and traditional social science tools such a interview & concentration group and more developed IT tools & concentrations such as measurement based on mobile and web-based tool in different researches. In a way that they are a good source for existing living lab methods and tools, they are still part of service and product development views. The main difference between living lab procedure and other user cooperation procedures is that living lab is a user-based innovation view with real users and in the field of real life, though provides the real test environment (Ståhlbröst, 2008). This methodology includes four repeated steps: view, first sample, Evaluation, publication & confirmation (figure1).

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Fig 1: living lab methodology (Tang & Hämäläinen, 2012)

Generally living lab defines in two meanings. In first, an innovative environment that whole value chain participate in developing innovative services in user together generating in real life field, In second definition this as a methodology and a systematic innovative procedure (Waara et al, 2013). The concept of living lab has appeared in urban field; Michel explains that lab environment (building, city and etc.) can be as labs that make the test and user on real data possible. Cities and fields (like, Economy, Energy and etc.) changes quickly because of Information & communication technologies and living lab can react to these changes (Skiba et al, 2010). There are two reason for this issue that the living lab starts to develop: 1) changing the consumer rules among IT users, 2) the second reason is that many of Information and communication technology development projects are done in closes environments that were fail because of limited interaction and delay with market (Ståhlbröst, 2008). When they investigate the change in consumer rules, change among Information & communication technology users in cooperation with big societies, can be seen for example in Facebook, Google Earth, Linux, Second life, You Tube & Wikipedia, this issue exists. These are the successful evidences about how the users try in generating valuable properties like content, products, service and etc. So users changes from passive content consumers to active together playing of contents & services (Waara et al., 2013). 3-1 Living lab for participating people in Research & Development: Modern Research & Development approaches appears in a way that users didn’t observed as people who involved in testing performances, So they considered as abled people in participating in generating value.

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William Michel argued that living lab shows a user-oriented method for research, sampling, validity, modifying the complicated solution about real life. He recognized some potential advantages (Pallot and Pawar, 2012). The considerable effects includes the following items: 1) User’s integration to developmental process for being sure about reliable market evaluation. 2) Decreasing the business & Technology dangers. 3) Living lab for SME, and micro organizations and new comers company’s usefulness. In a way that they can share the resources without perilous investment. 4) Big companies can reach a broader idea’s database 5) Process of user business design in living labs. De Ruyteretal (2005) express that living lab is a combination of a place which is concentrated on user’s experience method in testing a product/service & living lab process capacities for giving previous design experiences that formulate with experimental knowledge, and users participate in generating value. This means that user’s experiences covers all experimental design process in a living lab. 3-1-1 User’s experiences Alben (1996) Quoted from Hassenzahl & Tractinsky (2006) was the first introducer of user’s experiences in the field of interactive products: user experiences corers all the aspects which people have in using un interactive product: for example how are they feeling, how are they feeling in time of using, how do they fulfil their goals, how are they suitable in usage field, & how do they help their quality of life. Petelli & Not (2005) user’s experiences are explaining as a comprehensive concept that learn/ use, all user interaction aspects with one interactive product. 3-1-2 Experience Design Artez & Marzana (2003) Quoted from Diroyter et al (2005) explain Experience design as product design, Action, process, services, occurrences & environments by focus on user experience quality and suitable cultural solutions. Malke (2002) Quoted from Desmant (2005) demonstrates the user experience process model and introduce four aspects for experiences modeling: Comprehend usefulness, usage facility, hedonic quality, and photo attraction. Also, he entered for his innovative models to feeling measurements during interactive experience & point to job. Branko et al (2005) express that they use physiologic psychological methods to record emotional interactions process & effects. 3-1-3 Co-Creation In fact, services & products generate value from different aspects for example economical (like low cost, luxury), technology (like high level technology, low level technology), cultural (like fashion, art, hobbies), educational (like knowledge), organizational (like effective energy, compatible environment), being comprehend.

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For example, a cell phone produces economical value, that people are available, in a state that they were in everywhere. And a social value that considers in every time & place according to Co-operate capabilities is consumer’s ability to generate or customize their experiences for using products/ services by providers (Pallot and Pawar, 2012). The selected two cases of the many years of international living laboratory are briefly presented below: 1- Sizzle Lab: a campus-based international Living Lab research network on mobile social media The SizzleLab is an academic or campus-based international living lab collaboration platform and network on mobile social media domain. It originates from a living lab research project on mobile social media (Otasizzle) in Finland Aalto University (Mäntylä et al., 2009, Karikoski and Nelimarkka, 2010). OtaSizzle is an open living lab mobile social media research and experimentation platform situated in Aalto campus (Otaniemi) areas. It provides a set of social media platform infrastructures such as the core social media services and end user social media services. For example, ASI (Aalto Social Interface) service is a core service which provides social networking functionalities. Up to now, there are five end user social media services such as Ossi and Kassi. Later, the OtaSizzle environment and experiments are being partially replicated in China (BUPTBeijing University of Posts and Telecommunications), Africa (University of Nairobi) and US (UCBerkeley), which are called Beijing Sizzle, Nairobi Sizzle and CalSizzle respectively (Tang et al., 2010). 2- Active Aging: the China - Finland Living Lab Collaboration project on ICT enabled aging care research Aging is one of the serious problems the world currently faces. Therefore, healthcare for senior people is one of focal domains of living lab research (EC, 2010, EC, 2009). Under this background, Active Aging is “a joint development, piloting and research initiative between Chinese and Finnish partners aiming at creating, studying and validating new ICT enabled service concepts and solutions for the rapidly aging population in China, in Finland and in other countries”. Unlike the Sizzle Lab, Active Aging project is more business oriented than academic. Many business partners, especially the SMEs involve in the project. A non-profit company called “Active Life Village” was created. It is a consortium of research institutes (e.g. Aalto University), companies (Playground Company) and government (e.g. City of Espoo), which is a Public Private Partnership (PPP) by the parlance of living lab. Finally, the project promotes health care and the promotion of Chinese society in the cities of Beijing, and Wuhan was Shanghai. 3-1-4 Evaluation of Living Lab methodology For the evaluation of the proposed living lab methodology, Two living lab of SizzleLab and Active Aging are compared.  Vision  SizzleLab: The vision of SizzleLab is to create a campus-based LL for mobile social media research. The targeted users are mainly students in the campus contexts.

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 Active Aging: The vision of Active Aging is to enable senior people to live at home Independently by combining different healthcare ICT products and services to a Seamless user experience. The targeted users are senior people and related Organizations such as senior centers.  Prototype  SizzleLab: OtaSizzle project provides social media (especially the mobile ones) core services and end user services (Tang et al., 2010).  Active Aging: The prototype of ALH concept is demonstrated in the ALV company offices by simulating the typical apartment structure.  Evaluation  SizzleLab: Services are evaluated by the user research group in the project by both traditional social science methods (Suhonen et al., 2010) and mobile handset based measurement (Karikoski and Nelimarkka, 2010).  Active Aging: The prototypes are evaluated by some resident communities and senior homes in Finland.  Diffusion & Adoption  SizzleLab: OtaSizzle services are partly adopted and replicated in other collaborating international universities.  Active Aging: The ALH concept and prototype are adopted by China partners (Tang and Hämäläinen, 2010).  3-2 Living labs as networks of open innovation Living labs provide useful architecture for establishing open innovation. They should investigate as networks, because open innovation has a similar role based on voluntary participation and every participants (Chesbrough & Crowther, 2006; West, Vanhaverbeke & Chesbrough, 2006). Yet , Moller et al (2008) believe that it is possible that one of the parties become more active, or get their interest or innovation generation co-operate finally Leminenetal (2012) suggest 4 kinds of living lab based on this issue that who are steering operations or having more profits resulted from innovation: provider, enabler, utilizer and user-driven. These factors are different with each other in terms of activities, structure, and their organization. Didactic factor take coordination duty, but if didactic doesn’t able to. Comprehend in a single way leads to net work deficiencies & network isn’t able to generate the value for members (Leminen & Westerlund, 2012). This is so important that a factor, responsible for start & progress the living lab activities. At the same time with open innovation principle, living lab demonstrates on foreign ideas concept as a resource in innovation. Firstly, this approach supports innovation procedures which leads to usable services & products, As mentioned before in a living lab process, for example researchers, companies, users, governmental partners & technological beneficieres are cooperating in real world environments (Bergvall-Kåreborn et al., 2009). Bergvall-Karebornetal (2009) express the difference between the living lab and open innovation table (1) in 3 items.

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Table 1: Living Lab compared to open innovation Living Lab open innovation Business to consumer with a Business to business clear focus on user involvement Focus on the product/service Focus on the business model External input in the whole External input focuses on ideas innovation process and technology

Leminen et al (2012) in a research as title "living labs as innovation network” categorize living labs in four groups. (table 2) Table 2: Characteristics of different types of living labs Characteristic Type of Living Labs Utilizer-driven Enabler-driven Provider-driven User-driven Strategic R&D Strategy Operations Problem solving activity with development development by collaborative Purpose preset through action through increased accomplishments objectives knowledge Network forms Network forms Network forms Network around an around a region around a provider initiated by users utilizer, who (regional organization(s) lacks formal Organization organizes action development) or a coordination for rapid funded project mechanisms knowledge (e.g., public results funding) Utilizer guides Information is Information is Information is information collected and used collected for not collected collection from together and immediate or formally and the users and knowledge is co- postponed use; builds upon promotes created in the new knowledge is users’ interests; Action knowledge network based on the knowledge is creation that information that utilized in the supports the provider gets from network to help achievement of the others the user preset goals community New knowledge Guided strategy New knowledge Solutions to for product and change into a supporting users’ everyday- Outcomes business preferred direction operations life problems development development Lifespan Short Short/medium/long Short/medium/long Long

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The European Network of living labs (ENOLL) has developed to coordinate activities & share the learning experiences. Now this network constitute 129 living lab, after 3 force attraction wave, and both living lab Botaniya & Halmstend are members of European Network of living labs. For coordinating the activities all over the Europe, a project of generating collaboration named core labs in years 2006, 2007 were developed to generate an European network of living lab, form this project. Some report were delivered by increasing the insight purpose to living lab phenomenon. Based on these report (Bergvall-Kåreborn et al., 2009; Bergvall-Kåreborn & Ståhlbröst, 2009; Ståhlbröst, 2008; Ståhlbröst & BergvallKåreborn, 2008, Svensson et al., 2010, Ihlström et al., 2009), Bergoal etal (2009) present 5 key components of living lab environment and five key principles for living lab procedure that continues to be expressed. Key components of living labs are shown in figure (2). Infrastructure component & ICT dissect the role that Modern & existing ICT, faciliates the new ways of cooperation and making joint innovation among beneficiares, Management shows ownership, organization and political aspect of living lab, A living lab for example can manage by counselors , companies or researchers. Partners & users of living lab bring their special properties of their Knowledge and professions to help in, getting to knowledge delivery border. Research is a sign of group learning & reflections that occurs in living lab, and should be useful in helping a theory and action. Technical research societies also can have the direct availability to a research that improves, technical innovation results. Finally, an approach appears for methods and techniques as the best action in lab environment (Bergvall-Kåreborn et al, 2009).

Figure 2: Key components of living lab

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4- Conclusion After changing research paradigms and developing innovation bases on open innovation position, the void results from costumer’s presence in innovation process and gap between market need and technological pressure, for the countries to redesign its innovation infrastructures and move to network design constitute of beneficiaries so, an infrastructures appeared that all actors of innovation cycle (from government to customer) gathered in a systematic interaction, till remove this void and the living lab’s structures were generated. Generally, the living lab defines in two meanings. First is innovation environment that collaborate in all value chain of innovation services in co- creation with users in real life field. The second definition as a methodology and a systematic innovation approach. If living labs as a place or environment perform physically & virtually. In virtual state they can be uses as a systematic methodology. Living lab propound in America officially for the first time but for the first time it uses practically in Europe. In Europe this topic follows and will follow a lot. Till innovation increase leads to generate innovation Europe network as a network. These societies follows the relationship between countries and value generation. Living labs in American countries considers in more commercialized form. They follow this that how can they keep satisfy consumers & users compatible with their innovations. Generally we can use living lab in projects, and necessary innovations industry in an innovation place or environment by a research methodology. Because the living lab is a procedure or an organization to generate value based on user. This leads to this state that industry human resources mainly are these innovation users can learn all the interactive aspects with, an interactive product for example how they understand, learn & use. In addition of this users experience reaction can leads to improve generating value in innovations and because of using these designed experiences from past and also interaction between user & environment, the possibility of project’s failure become less. Also, as it showed Europe industry, with generating the Europe living lab, cause the economical growth & industrial progress in continent. This system successful experience show that with generating these network we can strengthen the research part & develop the open innovation paradigm in a suitable naturalization, that cause products & manufacture’s progress and finally national Economy. One of the pioneers and suitable systems for this infrastructure focus on research- oriented educational system that has an old antecedent in Iran. But lack of suitable interaction among research centers for example universities, industry & customers cause that this educational method doesn’t have any suitable efficiency of loss in recognizing the market needs & industry. The investigations shows that in living lab’s infrastructure, the innovative ideas were generated for university research & development and it can lead to country’s self- sufficiency and generating export. Opportunities and increasing the government income through taxes by changing to new product .On the other hand, country’s scientific inflation & increasing the number of PHD students in the form of education- oriented and research-oriented leads to increase scientific Capacities & also the practical expectance of experiences workforces. This cycle’s correct performance can guarantee the generating income & more profitability of manufacture and private centers. This will generate the motivation to form the private research &

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development centers in open innovation paradigm seriously and provide a suitable environment for this scientific employment.

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