The term “Radical Openness” was first coined by Don Tapscott in 2012 to describe a new generation of businesses that embrace transparency, sharing and collaboration. They seem to turn conventional business theory on its head, and have advantages such as being able to innovate faster and align more closely with the interests of society.
Three years on, and radical openness is becoming adopted by pioneers. Tesla is opening up its electric vehicle IP to accelerate the adoption of low carbon technology. Unilever is crowdsourcing new product ideas through its “Foundry” in a way that is visible to its competitors. Kering has just opened up EP&L methodology to encourage wider engagement in natural capital.
On the 6th July we explored whether this is will turn out to be a fad, or the determinant of success in an increasingly connected era. Moderated by Axel Threlfall, Editor at Large at Reuters, our panel included;
We discussed issues such as;
For a more in-depth look at this emerging area, please read Jim Woods's blog on radical openness here.
Openness is at the heart of the success of Wikipedia, Facebook and Twitter and is starting to influence sustainability strategies. This table will discuss ways that openness can be applied to sustainability; supplier transparency, product transparency, co-creation, crowdsourcing, sharing data and IP & more. Are there universal principles that can be widely applied in the open era?
1. What ways can openness apply to sustainability?
Ikea Global gives autonomy to each country but as a private business Ikea is not naturally open. It is undergoing a transformation but how can it be done rationally? – the UK is taking the approach of community engagement.
Unilever has a high level of staff movement between teams, encouraging transfer of skills, leanings and therefore connectivity.
Within private business it is a natural response of the CEO to want to protect high value business and potential business. The accountability of sustainability extends beyond the value chain and beyond regulations. Feedback of lessons learnt opens up companies and disclosure of shared information can be hugely beneficial.
Creating an ecosystem of partners can enhance business opportunities and sustainability but can limit innovation. Being a first mover in sustainability can be a failure as no one else acts similarly in the industry. However this could argue that openness and partnerships are even more important to make progress. This requires collaboration and review of shared values to overcome challenges.
2. Will people pay more for a ‘better’ life?
It requires companies to go all in and demonstrate their commitment VS. Innovation needs to happen outside of the core business to mitigate risk. Expectations of employees and customers should be managed to maximise engagement, this should come from top down with leadership vital to the success.
3. Is it an age/generational conversation?
Younger people are more open to collaboration and quicker to innovate. Pain drives innovation which the older generations have caused, resulting in the ‘youth’ finding wholes to open.
4. Is language a barrier to openness? Do we need a common approach?
GSK have experienced some countries are less likely to be open with cultural practices influencing business behaviour. This can limit the extent to which a company can fully roll out openness. There is a risk with openness that people will steal ideas and develop them in a closed environment.
The term ‘sustainability’ is no longer sexy and needs refining for each scenario/challenge/opportunity.
5. Are there principles that should guide who you collaborate with?
Industry groups that have an existing relationship VS. A mix of stakeholders that would not cause bias and ‘inside the box’ thinking eg. Lego approach.
People aren’t waiting for collaboration and ‘to be found’, it is an active process requiring companies to rise to the top of the noise. Engagement is needed; prizes are a good way to motivate people to think differently. Companies need to turn sustainability in to something understandable, relatable and aspirational.
• Most of the talk of openness is from web based companies, how do we access openness for the rest (those who are not known for their web presence)?
• Business is to profit, some say there is no value in sustainability; how do we link the two?
• “Try things and see” and “embracing failure” can be wasteful.
• How to encourage openness when keeping secrets makes money?
• “The greater good” is not enough for a business plan.
• Openness is very dependent on trust, how do we make trusted spaces to be open?
• Open source software is still not widely available.
• Open innovation doesn’t necessarily imply sustainability. Innovation could potentially be destructive, and sustainability just an afterthought.
• There is a need to be mindful of the risks that come with what you are sharing.
• Reputational damage is a fear of both being open and not being open.
• Realising/admitting your company is not sustainable is a great first step to link with others.
• Web site (google/facebook/twitter) started a service and their business came later.
• Lots of small companies sharing the risk and time which encourages openness.
• Crowd is a good example of “the right people” in the room, coming together from different sectors and with different insights able to solve a problem.
• Big, established companies may have more to lose. For a start-up, openness has everything to gain.
• More open data and knowing how to use it is key.
• Open input from ‘everyone’ in the company is very effective.
• Small company that takes the idea and makes it work is good, as it proves there is a market. Being the first isn’t important anymore.
Does the table agree that there is a lot of reinvention of the wheel going on in energy and carbon management? Which are the investment areas that are common to most businesses, where a better flow of information could make a difference? What information sources, coalitions and platforms does the table rate, and what do we need more of in the future?
Does the table agree that there is a lot of reinvention of the wheel going on in energy and carbon management? Which are the investment areas that are common to most businesses, where a better flow of information could make a difference? What information sources, coalitions and platforms does the table rate, and what do we need more of in the future?
The table’s discussion and recommendations for the strategy can be summarised into the following key themes:
1. The Role of Contractors
o When using and investing in contractors, across industries sectors, there is an expectation they will bring with them innovation and best practices
o Collaboration between contracts is key, where parties can collaboratively fix problems however this is a difficult culture to create
- This would only exist if there is a drive by demand or appetite for it
o The challenge in collaboration is to overcome friction and competition between contractors
o Is there information share of best practice across contracts and is there true visibility?
- Who is liable when different contracts partake in different stages of a project (inherited legacies)
- Without transparency, problems wouldn’t be identified
- Control over (all) information of best practices is a highly contentious position
- In control of best practices forces you to remain ahead of competition, being the best in your field/industry
- Transparency only occurs in areas which the business is confident in – there is still some way to go
3. The Nature of the Industry
o Difficult to be innovative and experimental in regulated industries
- Innovation in big utilities, companies that monopolise and are heavily regulated are driven by their regulation
- Limited by the demand/service they must supply
- Monopolise companies are at risk of thinking their in a safe position and opens opportunities for smaller/Knowledge sharing more innovative companies
o Industries innovation in relation to areas that are important to them
o Business find their reason to innovate in sustainability to give them a competitive advantage but there needs to the spearhead company which takes the first step
o Is there more hype and expectation in society than in reality in industry
- How can global case studies be used to encourage behaviours changes in society and industry
- Openness can add an element of risk in expose (to society and competitors) of where they’ve failed
- Is there enough support to persuade stakeholders
From food to textiles to tobacco, how can how vertical and horizontal collaboration drive smarter agriculture? This table will discuss which coalitions are making a difference and why, and explore what can be shared for everyone’s benefit – from data to farming practices to risks. What are the obstacles that need to be overcome in an open approach, and how can that happen?
From food to textiles to tobacco, how can vertical and horizontal collaboration drive smarter agriculture? This table will discuss the coalitions that are making a difference and why, and explore what can be shared for everyone's benefit - from data to farming practices to risks. What are the obstacles that need to be overcome in an open approach, and how can that happen?
Farmers don't tend to learn from each other unless they are encouraged to do so. This creates an opportunity to develop an environment which encourages this behaviour
Not a lot of data collected by farmers and knowledge is held by people – not shared
Where do we draw the line between competitive and pre-competitive information?
P&G and Unilever fined millions for collaborating on sustainability research and marketing. An example of collaborating too narrowly?
Trucost example of supply chain engagement at workshops – if similar companies were in the room then this would have broken competition laws
Vagueness around the ownership of data
Trusting the quality of data and finding quality data
Brands just want to compete with brands. They just want customers to assume that sustainability is taken care of and consumers don't have to think about this.
In a lot of cases in commodity production, the government is a key actor and can block action.
Farming is really far behind as an industry
Timing is everything – everyone can’t do this now. Need to know when the right time is
Don't let the perfect be the enemy of the good
Making sustainability the new normal isn't then a competitive advantage. Need to draw out the other benefits of sustainability. Sourcing British for example then becomes a competitive advantage as it infers added quality but this needs to be done cheaply
We are forgetting about the commodity traders in this discussion. There are some instances of vertical integration but we mainly see horizontal integration. Suggested that this is not the case in palm oil as NGOs (RSPO) have got to producers and are making a difference
Transformation in supply chains
Pre-completive collaboration is key. Need sector wide visions of what that sector looks like
Climate smart agriculture - two goals that have to be solved together
Role for academia. Government need to put some money into freeing up this research
Governments need to allow open innovation by making sure competition laws allow this, and companies aren’t afraid to open up and share information
Commodity traders are key stakeholders to be engaged
Identify and define what an entrepreneurial farmer looks like. Get farming to be a more aspirational career to keep people in agriculture, increase food security, and reduce poverty.
NGOs engaging with palm oil producers and removing commodity traders from the picture
Start small and scale fast
Incentivise farmers – use the give and get model
Sainsburys - only giving some info about carbon reduction through dairy supply chain
Kenyan smallholder farmers with no access to internet, phone reception, and sometimes energy – subsequent crop loss due to preventable ends (storage, disease…). Need to open the challenge up to a wider community to solve these challenges
A new generation of web-based platforms, such the Higg Index and Sedex, point to a future where supply chain sustainability can be understood at an affordable cost. For these platforms to scale, they need openness and collaboration. Based on your experience, what will determine their success and which platforms are getting it right? Are there any better bets for supply chain transparency?
How to create change in supply chains?
• Use leverage – need to have a good understanding of the power holders in the supply chain
• Use positive incentives for suppliers to change
• Collaborate – find common solutions & create a safe space for suppliers that don’t want to put their problem out there first
o Vertical collaboration - work together with the suppliers to bring them with you
E.g. bringing together supply chain of Better Cotton
o Horizontal collaboration – for example supplier-supplier collaborations
E.g. Nile Delta between 3 supermarkets – network of suppliers to discuss common challenges and establish collaborations
• Work pre-competitively
• Use industrial associations to scale up efforts.
Supply chain platforms
E.g. Sedex, Higgs Index, UNGC, CDP, Action Sustainability Platform & Supply Chain School
• Reduce number of audits
• Sharing of best practice
• Central means to blacklist suppliers
• Work towards common metrics
• Opportunities to link with solutions providers e.g. CDP’s Action Exchange Program
Benefits of open supply chains
• Engage procurement personnel not the sustainability team
• Trust & openness -> potential to build honest, long-term relationships with suppliers
• Brand enhancement opportunities – often heavily invested in existing supplier relationships so open collaboration brings opportunities
• Respond/pre-empt regulatory pressure e.g. UN Human Rights Guidelines
• No choice? Technology may mean that others can identify your supply chain risks before you
Challenges of open supply chains
• Due diligence on the supply chain e.g. for conflict minerals brings to light lots of other issues
• There may be trade-offs between mitigating different supply chain risks
• Supply chain issues are not black and white e.g. child labour and may need different indicators in different parts of the world
• Does opening up your supply chain and being honest about the skeletons in the cupboard create risk?
• If the market has a small monopoly of suppliers – how to incentivise them to change?
• Supply chain traceability is difficult and depends on the product (& doesn’t necessarily address the end objective)
• Disconnect between reporting and action. How credible are self-conducted audits that some platforms rely on? E.g. when companies shut and reopen with a different name
• Data is only as good as when it was collected
• Indirect suppliers complicate and/or undermine traceability and auditing systems
In its recent Plan A update, M&S made transparency a top 3 priority for its sustainability programme. This table will look at today’s issues where organisations should consider transparency, from product information to supplier lists, tax payment by country and CEO-to-worker pay ratio. What does a 2015 transparency strategy look like?
1. Where should organisations consider transparency?
- It was identified that currently in some Scandinavian countries there is transparency with employee salaries and tax brackets for 1 month of the year, where everybody’s information is released. What is interesting is that Scandinavian countries are reportedly some of the happiest in the world. Could this kind of transparency work in Britain?
- Logging customer requests and sharing these may be a forward looking approach for the retail sector to adopt. This could potentially aid companies in understanding their customers with a wider industry prospective.
- Reporting the efficacy of your company’s products, this could make a difference in understanding what is wanted by the customer. This aligns with desired openness in the investor market, people want to be conscious of where their money is being invested. Corporate pensions is definitely an area where more transparency would be welcomed.
2. What does a 2015 Transparency strategy look like?
- Full traceability and accountability.
- Potentially a difference between stakeholder and customer engagement regarding what is made transparent to who. I.e. Technical data information release for stakeholders, while a customer release would be lighter and easier to understand.
- Additional mechanisms could be set up for company to company sharing.
- Transparency must be genuine and organically grow from what the stakeholders and customer would like to see
- Regarding what would be transparent: Is it that today’s activists are tomorrow’s mainstream, and should we heed what is being said now for a future strategy? Could this approach keep you ahead of what is relevant to people when the time comes that you do release information.
The above highlights that what needs to be identified is cultural norms and motivations? Because being transparent on one thing in one country may not be useful or indeed appropriate in another.
Unlocking what everyone wants to be transparent is critical in the pursuing of openness.
Companies need to start asking what should be transparent to them, this means investing time and money in research.
It is important that companies do not “data dump” on their websites without providing a key for which people can use to understand it. Openness is not just about the release of data but the message that is portrayed when it is made transparent.
Where companies are transparent and display their ethical pathway, other companies often use them as a benchmark / due diligence for making decisions against. The more that companies share, the faster the bar can be raised.
Many companies today are already transparent in many of their operations with their reporting (i.e. sustainability reports) and social media. What is required now is a step change that could propel this notion of openness into a well-developed strategy with the potential for industry wide changes.
The biggest trend in innovation today is the shift from experts to crowd, facilitated by a new generation of digital platforms. Sustainability examples are emerging, such as CCE’s recycling challenge with OpenIDEO, Anglian Water using Wazoku and M&S’s Plan A Innovation Challenge. What need does crowdsourcing solve, and to what degree is it the future for sustainability?
The first topic discussed is the relationship between crowdsourcing, openness, information sharing and whether this has direct and beneficial impacts on a business. How successful are these strategies?
Skanska opens the forum with the example of their internal openness, where 5,000 employees have access to a transparent information network. It is added that the format’s potential development requires a little more energy and movement in order to achieve all the desired goals of the business it’s approach to this openness.
Is crowdsourcing and such openness a good thing? There is no flat read across for all examples, it’s a complex process and with an ‘Oldschool’ business structure such innovation can lead to complications, primarily from that of the aim of crowd sourcing as a method of diversifying the input into a business from an array of user experiences, however this diversification can sometimes be too broad, especially if said business has one key goal or aim.
Back on side with the positive outcomes of crowdsourcing, the methodology is engaging and increases a businesses’ footprint, giving a rounded and holistic viewpoint for the company to adopt and utilise.
Counterargument initiated by Royal Mail whom have experienced faltering effects of engagement due to timescale. Sometimes the level of initial volume of interest and commitment at the launch phase is higher than when the commitment is required to be capitalised upon. There can also be the development of a ‘Game Theory’ in the initial strategy design phases due to the conflicting interests of how crowdsourcing methodologies can develop outcomes with potential contrasting or competitive effects for those other parties.
At this point of the discussion, it was observed that INNOVATION, IDEALISM and INVENTION are all very different terms however when regarding openness can sometimes have some crossover with their meanings or at least intended meanings. Some clarity was required in order to progress with the discussions.
The issues that have arisen from a disengaged audience have been problematic since the 1950’s, modern technology has broadened the reach and improved the ease of reaching people far and wide and subsequently giving a sense of ownership to a customers interaction with a company, all achieved through this transparent approach. Furthermore to this use of technology to ease engagement, Skanska have a traditional business structure with the likes of Senior and Junior engineers, with the introduction of the technological platform, a canvas for ideas further down the traditional projection ranks.
Openness like anything business orientated can require incentives to drive interaction and beyond traditional realms of financial incentives, the benefits are often in the form of publicity promoted by the attachment to a successful business; REWARD and RECOGNITION.
From the round-table discussion, the key themes achieved were;
• Testing these new innovative engagement methods can sometimes crumble when introduced to the extensive business structure/practicalities of reaching business goals.
• Crowdsourcing can introduce a diverse array of opinions, however its imperative to strike it right otherwise polar extremes can divert away from its intended goals.
• Network theory should be a consideration when crowdsourcing, influential bodies can sway the direction of opinions and can cloud or muddy what is considered an overall consensus.
• Peer reviewed panels are oldschool and restrictive, crowdsourcing is a new-age approach to this. It makes the most of all technological platforms and gives a wide range of customers a voice; however stringent guidelines are required in order to collaborate this approach with the intended outcome.
Many social impact measurement tools have emerged, but none have been applied by business at scale. The WBCSD has drawn a positioning paper proposing a collaborative process to develop a universal protocol for companies to measure and manage social impacts. Kitrhona Cerri will present this paper, and the table will discuss how the co-creation process can succeed.
The World Business Council for Sustainable Development (WBCSD) is developing a Social Capital Protocol (SCP): a standardized framework for businesses to approach the measurement, management and valuation of their social impacts.
WBCSD believes that by 2050 a business should be measured by its ‘True Value’ and should use ‘True Costs’ and ‘True Profits’ in its internal and external reporting. This would imply redefining existing concepts of: profit and loss, performance and value creation, to consider longer-term environmental and social impacts. As a consequence, we would need to ensure prices reflect all externalities: costs and benefits.
State of play
• Today businesses have a multiplicity of different tools and frameworks at hand.
• As a result, businesses are struggling to effectively integrate social capital measurement and management within their organizations.
• There is a need and opportunity to create a standardised approach that can bring increased consistency to the sector.
Vision of success
Kitrhona was asked to sketch out the longer-term ambition and end goal for WBCSD’s Social Capital Protocol:
• Businesses gather and use social capital information to guide their day-to-day decisions at every level – from strategic to tactical and operational management.
• Appropriate tools and measurement frameworks are in place and are used consistently across the organisation
Key questions and takeaways
1. Who would guide and regulate this process? How can businesses know they are gathering the right information?
• WBCSD recognises the need to conduct this process in a collaborative way and are therefore liaising with different organisations to bring Protocol to life (this includes engaging with organisations both in the reporting and natural capital sides). They are also bringing together assurance providers and looking at relevant regulation and requirements in this space.
2. How does The Social Capital Protocol linkto existing external reporting frameworks?
• Reporting can be highly disengaging for companies- particularly in the context of limited incentives and competing tools and approaches.
• Being quantitative and results-driven, reporting frameworks tend to disregard important elements which are central to social capital measurement. For instance, how do we price happiness, dignity or the right to life?
• In order to drive change in the way social capital is measured and appreciated, we might need to take a step back from reporting and start thinking about how we can effectively change mind-sets, behaviours and perceptions around social impact. This process should be less about reporting and more about learning how to embed social capital at the heart of the decisions people make.
• There is a pressing need to strengthen the business case for social capital and ESG reporting and compliance – businesses are, and will continue to be concerned about how reporting could drive increased business opportunities and competitive advantage in the sector.
3. How do we monetise social impact? What should be monetised?
• Today there are a lot questions on what to monetise, why and for whom.
• In some cases it is not necessary – or even advisable - to monetise. For some externalities it might be more suitable to utilise operational KPIs. However, there is still limited consensus on ‘where to slice and dice the cake’.
• Perhaps the focus should shift from the ‘hard’ valuation and pricing components needed for social capital measurement to the ‘softer’ conditions needed to ensure this process is successful. There is a need for the creation of new spaces for collaboration and co-creation which can bring momentum to the development of a Social Capital Protocol and fuel a bottom-up ideas revolution.
4. What drives a business to change course?
• Most businesses have a social mission, so they should be compelled to act on it. In practice, however, many struggle to effectively translate that social purpose into their operations.
• One of the attendees expressed that there might be drawbacks for businesses attempting to merge their financial and social mission. In the process of mixing up what could be distinct social and financial aims, businesses might ‘get a blur’ and end up not succeeding in neither of these objectives.
5. What are the challenges around collaboration?
• People pushing for speed. There is a lot of enthusiasm around social capital measurement and particularly the Social Capital Protocol. People are keen to engage and collaborate. There is the pressing challenge of effectively managing stakeholder expectations and keeping up the initiative’s momentum. We are in a culture in which people loses interest very quickly and hence, it is important to ensure engagement is sustained over time.
6. What does best practice looks like?
• It is extremely important to understand best practice. There are not enough case studies and examples of best practice that companies can draw on and build their business case upon. Resources such as The Global Value Exchange was cited as a useful platform for relevant case studies.
7. What are the challenges about disclosing information?
• Businesses that disclose their information will be inevitably putting themselves up for scrutiny. Attendees considered this was an important barrier for business engagement in reporting and transparency.
• This is specially pressing for international companies outside the UK. The UK market is more mature and has come a long way in further disclosing practices among corporates.
Insights and conclusions
• Cross-sector learning - There is scope for learning from the social sector, particularly from the development of Standards of Evidence for measuring social impact.
• Short-term guidance – There is a need to provide businesses with enough guidance and tools to use the information and data that is currently available to help them make better decisions.
• Best practice - There is a need to develop and communicate best practice in the sector – particularly through case studies. It is also important for companies to know not only who is doing well but ‘who is being brave out there’.
• Standardisation - There is a pressing need for clearer Standards – best practice cases such as PUMA’s are still a ‘black box’ for most companies.
• Tailored approach - This is a very complex field and therefore requires independent criteria to be developed.
• WBCSD has developed a set of downloadable tools and guidance for monetising and valuing.
• They are currently conducting a study with 20 member companies to understand how social capital is being used in decision making.
• They will be piloting an early version of the Protocol.
Competition is the heart of the capitalist model, driving innovation and quality and is typically associated with a high level of secrecy. This table will look at whether calls for sustainability to be “pre-competitive” and open are appropriate – why might it drive faster change, and how would it work with the motivations of the system? Could secrecy, in fact, deliver faster change?
1. Opening statement by Chair
- Lots of fun and controversy with this issue. So lets have some fun with this topic. Chair has chosen one member of the table to start as she has a suitable and fantastic job title – Chief Fun Officer.
2. Each person around the table outline their thoughts on the issue
- Secrecy and privacy are becoming underrated and undervalued. Years ago, it was crucial to keep things to your chest- in the context of the war what would have happened if we didn’t have secrecy?
- Secrecy is a thing of the past. You need to be proactive as there is no benefit to keeping your cards to your chest- you need to control and frame what messages come out from your company.
- Example of pregnancy app. Eg-how she should be feeling, what she should be eating, how big the baby is. But the app was deleted because it shows the percentage likelihood of miscarriage. Some things are better off kept away from us. Secrecy for the sake of our own wellbeing is sometimes needed.
- Security can benefit competition at the moment. But in the long term security is probably obsolete.
3. Chair puts a question to the table - Is there a difference between openness and honesty?
- Communication’s mantra “The best story that is consistent with the truth” so no, honesty is not the same as openness.
- What will happen when people have a long history on social networking back 10 years. Employment is now being determined by your social media. Secrecy is a reflex action. Its away people protect themselves. It’s almost natural. A game strategy.
4. Chair puts another question to the table - GIVE/GET. Does this mean big companies get?
- No. it’s about partnerships. This could be uneven, but it doesn’t mean there won’t be an appropriate trade. People need to be open and outline who owns the IP. The way to even the market is to publish the route to market and publish your strategy.
5. Back to going around table with thoughts on security and openness
- Secrecy or openness a way to full fill your purpose as a firm. So you chose openness or secrecy depending on your purpose and aims of a company. So yes, purpose will be more likely to be needing of openness because of the web etc. In defence of security – the timing of secrecy is really important. It’s not always good/bad dichotomy.
- Security is all about timing. Who is to say openness will help with a company right at the beginning of its journey? Whereas if you have a big company they are at a different stage. Secrecy doesn’t necessarily lead to better software, though it’s sometimes cheaper.
- Openness isn’t applicable to everything they do. Products which are mature will only see very small improvements. If we shared these products openly we wouldn’t be able to compete with china. In terms of sustainability it is more beneficial to be open and to work with other businesses. So some products/ areas there is lots of room of openness. But in mature business and products they may not need innovation. There is no forest to cut through. We don’t need help from others to cut through.
- Perhaps it is a false differential. With big data there is so much info out there. It is impossible to see truth from fiction. So openness will take different forms. Secrecy and openness will have advantages- eg finding a solution to a problem yeah. But you have then a full product and there has to be closure where the benefits need to be closed.
6. Open table discussions to end
- What will happen when our games are copied? Small businesses need to be the only ones who give this service. There is a value in security to protect your product.
- Quality openness rather than just any openness? In terms of information disclosure, companies chose the language and framing they want. Selective disclosure could be used as an advantage?
- But should be always see big companies as trying to drive dishonest aims. This is not always the case. It is not the case that NGOs don’t have agendas either. They are third parties, but they are not necessary agenda free.
In an increasingly connected era, opportunities are emerging for businesses to use their data to build a better society. The internet of things, sharing of drug trial data, and the use of mobile phone data to spot social trends are examples. This table will discuss the major opportunities, the obstacles such as trust and competitor collaboration, and who is best placed to lead.
• Why open data now? The benefits are substantial: empowerment, transparency, better decision-making; whilst the cost of the technology is next to nothing. In addition, an increasing number of individuals are becoming aware of the benefits of open data given the impact of smartphones in our lives. As we become more connected and transparent there is an opportunity to move faster and become savvier, rather than reinventing the wheel. This is even the case within a single company that has siloed business units or lacks strong internal communication networks.
• Existing opportunities. At first glance there a few areas of interest for radical openness:
o Improve education and ICT skills (e.g. MOOCs)
o Empower consumers (e.g. Unilever)
o Support entire industries with collaborative databases (e.g. insurance claims)
o Leverage processing power (e.g. the Power Sleep app uses your phone's processing power to perform scientific research while you sleep http://www.samsung.com/at/microsite/powersleep/)
o Leverage energy supplies by moving energy around the grid to where it is needed most. Also, data collected from the machines requiring energy are given back to the customer to help them better manager their energy consumption and operation (e.g. Open Energi http://www.openenergi.com/)
o Improve transport and security (e.g. London Bridge station uses mobile GPS technology to track footfall through the station, which helps to better manage supply and monitor for suicide attempts).
o Support social innovation (e.g. the Social Innovation Partnership is a social advisory business that joins up the dots between research, policy and practice to drive social innovation).
o Improve healthcare (e.g. shared pharmaceutical patents and connecting patients with the same condition to support and learn from one another).
• Business intermediaries. Business intermediaries tend to collect large amounts of data, though often this is only shared with their customer to help the business. There is a potential opportunity to support industries, government or empower consumers with this data.
• Social good. Could open data help us save countries or mitigate climate change? For example, open data on emissions would help us to name and shame. Also, if Greece’s economic details were opened up to the public a year ago then there may be a possibility of addressing the issues more quickly or more effectively (e.g. Indiegogo campaign to crowdfund Greece and the recent social media storm to take your next holiday in Greece).
• Public perception. In the US, complaints about businesses are registered in the public domain. https://www.bbb.org/ This has pushed down the rate of complaints a company typically receives given the power of negative PR. These declining rates of complaints for a given company are not common in the UK, where complaints are not registered in the public domain.
• Data-based people management. Google have implemented a highly-developed people analytics programme in both its recruitment and employee career management. By collecting and sharing this data with employees and other departments it is able to help individuals realise greater career aspirations and drive further innovation within the company. http://www.eremedia.com/tlnt/how-google-is-using-people-analytics-to-completely-reinvent-hr/
• Misunderstood data. Data from pharmaceutical trials are often manipulated by experts in order to create a certain story and eliminate confusion for the consumer. By opening up this data to the general public the results can be misinterpreted, creating confusion around drug purpose. Further, not all data tells a story and could create more fodder in an already data-intensive world.
• Risk of data bubble? How feasible is it to sift through reams of data? How do you prioritise large amounts of data? For example, in the energy industry the data share tends to be one dimensional (e.g. power consumption). This simple metric can be powerful and revealing. If all data were to be collected and shared would it improve the energy industry?
• Social v corporate data. Social data is very open, but corporate data tend to be fairly closed. Access data in a market without open data regulations may prove extremely difficult.
• Need for business case. Do businesses need to find a compelling business case for open data? For example, in healthcare sector not sharing of data within the health system or an organisation wastes a lot of money and creates poorer patient care. There is a monetary benefit to be realised. But what happens when businesses cannot sum up the benefit in dollars and cents?
• Open v social innovation. Is open innovation the same as social innovation? Companies can share data to improve the lives of their customers, though whether this creates a better situation for society is not necessarily the case. Further, many companies have data that, if shared with other bodies, could create societal value. Though without a business case there is often little impetus and focus from companies to take action.
• Bigger pie, less to eat. More data can certainly create a bigger pie, though whether your portion grows or shrinks is not guaranteed. This creates risk and uncertainty for companies to share their data. The counter argument to this is if your business is a market leader and is one step ahead of the competition then sharing data will not cause a serious detriment.
• Data privacy and security. There is a lot of controversy around who owns and uses customer usage data? People need to have a better understanding of how their data is used before data can be opened up. The same might be said about corporate DNA in the public sphere.
• Poor regulation. Regulators are not keeping up with open data, creating a complex or confusing space for companies to venture into.
• Poor data standards. Current systems and databases can be quite time consuming to extract relevant data. There is a need for data standards, not least to support interoperability.
• Right to be forgotten. With the right to be forgotten it is much more difficult to get private data.
• Cynical boundary. Companies with the sole purpose of providing data will not benefit from and open data infrastructure.
• Bigger is better? As small companies are relatively nimble embracing a new data structure is much easier. Though where should a large corporation start and to what extent?
III. Solutions / Leadership
• Data analytics. Publicly-sourced data makes up about 95% of what government intelligence organisations use. It can be less about access and more about how you pull it together and crunch it.
• Radical innovation. We’re bombarded with huge amounts of decisions every day, how do we select the right data and use it in a meaningful way? Vodaphone, for example, are reaching out to rural communities (e.g. in Bangladesh) that have access to mobiles and collecting their data. They then step outside their corporate walls to look at opportunities this data presents, without regards to company mission or goals. This then allows the business to pivot or expand into these new opportunities that would otherwise never have been considered).
• Profitable and ethical. Profiting out of open data is a good driver for businesses to prioritise this type openness. Where profit and sustainability exist, there is a winning combination to create social good with radical openness.
• Give and get. Companies often have proprietary data systems which die away because there is no community around it to support and develop it. By making systems open source we have seen technology grow exponentially time and time again.
• Overcoming the naysayers. By opening up data it is unlikely competition will be obliterated. Rather, it will continue to be a strong capitalist mechanism for development and progress, but driven by other differentiators, such as relationship management, tailored service, brand reputation and so on. If everyone has access to the same data, the more likely outcome is that the entire playing field will be elevated and consequently whole industries will improve as a result.
With certification schemes such as Fairtrade, FSC, MSC evolving and becoming more widely adopted, this table will explore what it would take for major companies to commit to 100% certified products. What are the barriers to certification becoming standard, and will commercial interests ultimately hinder complete pre-competitive transparency?
HIGH LEVEL CONCLUSIONS:
• Trust is a key obstacle, and big unknown
• “Gateway” certifications (such as PEFC) have clear benefits, but negatives could outweigh the positives in the long run. Should companies instead have to make greater effort to achieve certifications with more rigour and clout (such as FSC)?
• Barriers to full certification are significant. Buying from an open commodity market makes a switch difficult, compounded by many “certified” materials not being certified at all – despite businesses paying a premium.
• Certification is a key tool, but is still small when you look at total production. For certification to work, it needs to become the norm. Premium prices may prevent this from happening in the long run.
• Certification should never be static- it should constantly evolve to become tougher.
FOOD FOR THOUGHT:
- Certification schemes abound and are expanding in raw materials space, beyond food (where there are over 300 labels), but many are still missing in mining/extractive industries. Is the day imminent when every raw material will have a corresponding certification scheme available?
- Do we need more, or fewer certification schemes?
- If you have one sustainability goal, why would you use multiple labels?
- Does certification offer value for money? What’s the ROI?
- One solution (certification) may not fit all suppliers. So what to do?
- Will demand for certification expand into the developing world – and if so, to what extent and when?
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