The Creation and Articulation of Value in the Creative Industries

Salford, April 14

Ted Fuller

Lorraine Warren

Giles Lane

Data: Creative industries within EPSRC CREATOR Project

Empirical research: Tracking co-creation in projects between groups of technologists and artists http://proboscis.org.uk/category/films/

Proboscis’ Sensory Threads project (people, their health, the local geographic context …)

http://socialtapestries.net/sensorythreads/index.html http://proboscis.org.uk/projects/sensory-threads/ Gesture and Embodied Interaction workshops at Newcastle and Cambridge http://www.creatorproject.org/partners/129.html

IT-Innovation, a company involved in developing a new business model for a portal in the post-production rendering industries in Soho

http://www.it-innovation.soton.ac.uk/

Creative industries as engines of innovation

Emergence of VALUE Disruptive and incremental innovation Major source of innovative ideas for new products

and services Offer services that may be inputs to innovative

activities of other endeavours Intensive users of technology, often demand and

create adaptations and new developments, takes technology forward

– Muller et al 2009

Purpose

Engender new behaviours Seek new business models in Digital

Economy Disruptive industry change -> how might this

emerge? How might we capture emergent value [or increase likelihood of capturing emergent value]

Key questions

How can we conceptualise the deeper dynamics underlying the anticipation and emergence of value in creative technological processes

How can the ‘value spectrum’ be articulated so that the contribution of small creative arts groups is recognised and rewarded

Conceptual Framework

A METHODOLOGICAL CHALLENGE: How “entrepreneurship” and innovation are causally connectedHow to research ‘emergence’How to capture multiple observations at multiple levels of analysis over time

Theory

Emergence perspective on entrepreneurship and innovation…informed by…

entrepreneurship theory (e.g. effectuation, bricolage, opportunity, entrepreneur, network), complexity (emergence, attractors) and critical realism (e.g. morphogenetics, structures, causal mechanisms)

…interlinked processes of interactions between agents and structure produce emergence

…ontology is as significant as process (by agents) to the production of innovation (changes in structure)

Cf. Ephemeral and stable ‘emergents’ (Sawyer 2005)

Individual (Level A)

Intention, agency, personality, cognitive process

Interaction (Level B)

Discourse patterns, symbolic interaction, collaboration, negotiation

Ephemeral Emergents (Level C)

Topic, context, interactional frame, participation structure; relative role and status

Stable Emergents (Level D)

Group sub-cultures, group slang and catchphrases, conversational routines, shared social practices, collective memory)

Social Structure (Level E)

Written texts (procedures, laws, regulations); material systems and infrastructures (architecture, urban design, communication and

transport networks)

The Emergence Paradigm (Sawyer 2005, p211), showing the ‘circle of emergence’ (p220), i.e. that area which is subject to social emergence

Methodology

Gaze on empirical emergent (ontological) properties that have an influential effect on the shape and sustainability of the system we are observing.

In practice, this means keeping an eye on the group of actors foregrounded in the study and on the artefacts, discourses and exchanges produced.

Our analytical perspective is value creation; how is value created / captured?

This is ongoing research (Cf. ‘future research)

Sensory threads

Proboscis: publicly authored work where events and installations are designed to enable people to use emerging technologies in new and exciting ways, creating and sharing knowledge that is often location-based (IRO)

Group expedition through a city using wearable sensors and real-time audio feedback

The ‘Rumbler’ a gallery-based interactive soundscape ‘player’ [pic]

Queen Mary, Nottingham, Birkbeck

Methods

Participant observation during team meetings Analysis of the Basecamp project archive

(which included specific reflections on value emerging from creative and technological discourse )

Informal ad hoc conversations with project participants

Emerging value

Do we know what future ‘value’ might look like?– As in ‘The Rumbler’??

Relationship between co-produced knowledge (novelty of ideas/concepts) and ‘value’ (exchangeable value within an ecology of actors)

Relationship between human and social capital <-> symbolic and economic capital

How do relationships maintain their generative power -> communities of practice?

Value Creating

Individual – personal research strengths, , new connections, levels of trust (high-level gains)

Project team – manage complex collaborations, reputational ecosystem, articulate the value of arts/academic projects in research in bridging research cultures *not* just adding a bit of stimulus

Temporal dimension -> technical/creative->academic->economic and wider societal impact

-> Value capture: Business Models

“it creates value and it captures a potion of that value. It creates value by defining a series of activities from raw materials through to the final consumer that will yield a new product or service with value being added throughout the various activities. The business model captures value by establishing a unique resource, asset or position within that series of activities, where the firm enjoys a competitive advantage”

– Chesborough et al, 2006

Value capturing (or Business model challenges)

Innovation takes place across distributed networks [poor correspondence with linear ‘business plan’ models, value chains value networks/value ecologies (Hearn & Pace, 2006)]

New network configurations present challenges to traditional modes of monetisation and value capture

High uncertainty Values issues regarding interchange of artistic,

cultural, social capitals, particularly where creative output is critical of powerful groupings

Business model challenges: creative industries

Values clashes Tensions between first and second order

activities [Thelwall] Potential for amplification

Outcomes: ‘Stable emergents’ in creative ‘value creating systems’ (coarse grained analysis)

Inter-activity between agents was the way that values associated with creativity or technicality interacted with economic value... (e.g. reputational value)

…possible trajectories were identified and tested out, either as thought experiments, shared mental models, or sometimes as rough working prototypes….

…‘ephemeral emergents’ were narrowed down to the most promising variant: at this point the transition from ephemeral to stable occurs.

…this is the point at which discussions shift from value creation to value capture. (Warren, Fuller et al, 2009)

Conclusion (one of many): value creation and value capture…3 types of model

“The first is a model that creates the conditions for creativity and reputation by establishing attractors; typically resources for co-operation.

The second is a model that stabilises the emergent properties of the

first; typically the creation of codified knowledge.

The third is one that enables the exchange of monetary value for this codified knowledge, and is more recognisable as a business model by investors

Attract/amplify <-> stabilise <-> realise value

(Fuller, Warren et al, 2009)

Final thoughts

Attract/amplify <-> stabilise <-> realise value ROLE OF HEIs/Government/organisations IF ANTICIPATION OF VALUE STABILISES

EPHEMERAL EMERGENTS, THEN HOW IS THAT ARTICULATED?

[Engines of innovation & anticipatory thinking in a creative milieu]

[worth, usefulness, merit vs. power, habits, harm] [Social contract]