The Cuckoo’s Nest Approach for Co-Creating Business Ecosystems in Smart Cities

Abstract

IntroductionThe current global megatrends of rapid urbanization and digitalization are placing great pressure on the sustainability of our cities and are bringing about major changes in the living environment of city dwellers. Simultaneously, these trends also offer increased possibilities for sustainable urban development following the principles of circular economy, including the exploitation of existing infrastructure and services while taking advantage of new technology. Additionally, smart city strategies include engaging citizens and local businesses in the development of their communities. Indeed, participatory planning has been a growing trend in urban development projects in the past few decades. End users have been increasingly engaged in design processes using different collaborative methods. While this is a clear improvement compared to a designercentric approach, the existing participatory planning methods generally involve a pre-defined object of design, as well as a professional designer to lead the process.The development of business ecosystems in smart cities is currently hampered by the absence of established approaches for facilitating long-term value and sustainability. In our view, the underlying reason is the lack of collective action involving various organizations in the design process. Collective action for the good of the whole ecosystem does not take place in existing participatory practices because of the dominating role of a single customer or designer organization (in urban development projects typically the owner-developer or lead architect), who uses their bargaining and decision-making power over others. This leads to sub-optimal behaviour where the system is optimized for the goals of one strong organization instead of collectively developed system-level goals of the business ecosystem as a whole. The Cuckoo's Nest approach addresses this problem by inviting various expert organizations to design the system and assigning each organization design rights for the ecosystem and its system-level goal. The Cuckoo's Nest approach enhances collective action among the organizations by making individuals from various organizations consider the interests, goals, objectives, and value-adding elements of other organizations -not just those of their own organizations. With the Cuckoo's Nest approach, the business ecosystem comes first, and single organizations' goals or specific design features come second. This article discusses the outcomes of two workshops where the Cuckoo's Nest approach was used for the purpose of developing business ecosystems in connection with smart city development projects within the Helsinki Metropolitan Area. We outline the steps involved in the Cuckoo's Nest approach and how they were applied in these two smart city projects, and we describe how it is being refined for further use in other locations and contexts.The stars up close to the moon were pale; they got brighter and braver the farther they got out of the circle of light ruled by the giant moon.

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“…The external change that is facilitating the development of living labs is the ability for a range of stakeholders to become freely involved in the process of innovation [100]. The service-dominant logic [48], open innovation [101], user innovation [29], user-centered design [102] or even social (rather than economic) innovation [103] have become possible due to the ability to create communities of interest for almost anyone.…”

Understanding Smart Cities: A Systematic Review

“…The development of business ecosystems is currently hampered by the absence of established approaches that facilitate long-term value and sustainability (Artto et al, 2016).…”