Book Review: Innovation Design

Disclosing shared value in business ecosystems – Or how to sustainably transform people, organisations and society

How many times have you heard people and organisations talking about the superior value they or their business are supposed to create? And how often do you end up terrified by how trivial, unconvincing or insubstantial their claims a.k.a. value propositions are? And do you also have the feeling that the term value suffers a fuzziness that invites its abusive use? Well, this book finally brings some substantial structure to the »value mess« …

Whereas most of the literature in the business realm still deals with value in rather utilitarian and often supplier-driven terms (e.g. costs vs. benefits or pains vs. gains) or takes a shallow marketing perspective on the topic, Elke den Ouden’s book is one of the first which provides a holistic view on what actually constitutes value in a context of innovation in a transformation age.

She not only shows that sustainable value has to be created between many interrelated levels (user, organization, ecosystem and society) but also disentangles the various research streams in which the term is negotiated completely differently. Besides the dominant economics view, she therefore also integrates conceptualizations from psychology, sociology and ecology into an easy to understand »value framework«.

Value Framework

The framework is complemented by a »value flow model« that visualizes the different reciprocal relations and transactions in the form of value flows (e.g. money, information, goods and services, etc.) within ecosystems. It is also enriched with information on the relative power, importance and value motivations of the ecosystems actors and entities. Having such easy to use and visual conceptualizations at hand can prove invaluably when constructing new product-service systems or business models. Just think of complex services with many interdependent actors (e.g. the well known ecosystems of Apple, Amazon, Nintendo, Nespresso or Microsoft but also new ones like peer to peer car sharing service Getaround). Meanwhile not only Nokia, which has already been dethroned by superior competing ecosystems of Google and Apple, but also Intel has to fear ARM’s power in form another resilient configuration of shared value.

Value flow in a business ecosystem

Elke’s clear systemic descriptions and her visual representations will help innovation teams to chart (and build) such complex interdependencies from a really holistic shared value perspective. It helps mapping out and comparing (competitive) status-quo situations and developing scenarios for future value constellations. This in turn fosters systemic thinking and awareness on what actually constitutes value, guides strategy discussions into expedient directions and perfectly complements existing tools like for example the Business Model Canvas by adding an richer and exhaustive perspective on its value proposition building block. Also tensions between its partner and customer blocks in co-creation scenarios (that usually can’t be visualized properly in the canvas) can now be made visible in a very elegant way.

»Innovation Design« is therefore a »must read« for everyone concerned with strategy, innovation, design and entrepreneurship. As it also wittingly and frequently integrates today’s hot topics on social business and sustainability very well, I would also recommend it to a wider audience, interested in how to resolve the ever-recurring trade-offs between viability, feasibility and social and environmental goals. What excites me personally the most, is that her approach helps not only uncovering but also inscribing new meanings – which for me is the supreme discipline of value creation. I hope the book gets the attention it deserves!

Innovation Design: Creating Value for People, Organizations and Society (Elke den Ouden)