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Participatory business modellingJacob Buur a , Bernd Ankenbrand b & Robb Mitchell aa SPIRE Research Centre, Mads Clausen Institute, University ofSouthern Denmark, Sønderborg, Denmarkb Constructivist Finance, Karlshochschule International University,Karlsruhe, GermanyPublished online: 18 Mar 2013.

To cite this article: Jacob Buur , Bernd Ankenbrand & Robb Mitchell (2013) Participatory businessmodelling, CoDesign: International Journal of CoCreation in Design and the Arts, 9:1, 55-71, DOI:10.1080/15710882.2012.760609

To link to this article: http://dx.doi.org/10.1080/15710882.2012.760609

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Participatory business modelling

Jacob Buura*, Bernd Ankenbrandb and Robb Mitchella

aSPIRE Research Centre, Mads Clausen Institute, University of Southern Denmark, Sønderborg,Denmark; bConstructivist Finance, Karlshochschule International University, Karlsruhe, Germany

(Received 28 March 2012; final version received 17 December 2012)

How to generate business is at play in most innovation projects today. Not onlyInternet-based businesses, but also traditional manufacturing companies withconventional product sales are currently challenged to consider alternative businessmodels: service design, project sales, direct sales, etc. In participatory innovation thecore assumption is that a broad spectrum of people, including users, can contribute toinnovation. But is it possible to open up the process of business model innovation toparticipation from a wider circle than those marketing managers who typically devisenew business schemes? In this article we discuss two participatory approaches tobusiness modelling that move beyond spreadsheets and Post-itw Notes: one of usingtangible objects to redefine business elements, and another of people themselves role-playing how an organisation can create, deliver and capture value. These approacheswere developed in companies and educational settings and have proven extraordinarilysuccessful in initiating conversations about how to innovate business in cross-disciplinary and cross-functional groups of participants. Relying on design theory, westudy the ‘moves’ that participants make towards a new network configuration; inparticular as such conceptual ‘moves’ are likely to be associated with the concrete,physical movements of people and objects. We claim that these approaches prove veryengaging because business model innovation needs a focus on redefining the conceptswe use and the roles that actors play in relation to each other.

Keywords: participatory design; business models; value networks; innovation

1. Introduction

In a situation in which companies increasingly rely on collaboration with external parties

to innovate their products and services (users, customers, distributors, public

organisations, etc.) it becomes essential to establish conversations in cross-disciplinary

settings. Such conversations need to concern not only the emerging product and service

concepts, but also business concepts, as business models become increasingly diverse in a

changing, digitised world.

A business model is a simplified representation of the company’s business logic: how

it makes money through its products or services. ‘Every company has a business model,

whether they articulate it or not’: it defines how the company creates value for the

customer, and how it ensures there is a profit to be made (Chesbrough 2007, p. 12).

Business literature claims that conscious discussion of business models within the

company, and with suppliers and customers is necessary to ensure competitive edge – and

that experimentation with business model alternatives is required to stay on the edge. So

q 2013 Taylor & Francis

*Corresponding author. Email: buur@mci.sdu.dk

CoDesign, 2013

Vol. 9, No. 1, 55–71, http://dx.doi.org/10.1080/15710882.2012.760609

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there is good reason to try turn business models into something people can touch when

discussing options.

Companies are increasingly dependent on other actors outside the organisation to

create business, and the literature suggests concepts such as ‘value chain’ and ‘value

network’ to illuminate this trend. Where Porter’s (1996) concept of the value chain

focused on the internal organisation of activities that lead to business, later research has

focused on interactions in the value network between the company and its suppliers,

customers, etc. The concept of value networks has its origins in Normann and Ramırez’s

contention that business strategy should concern itself with the entire value-creating

system, rather than an isolated chain of activities (1993). A value network is a web of

relationships that generates economic value and other benefits through complex dynamic

exchanges between two or more actors in a network, whether they be individuals, groups

or organisations (Allee 2000). Value networks are typically depicted within business

circles as blobs (or boxes) and arrows. The blobs are nodes representing the actors, and

arrows the transactions or connections between the different actors. The arrows are

normally labelled with ‘deliverables’, i.e. a description of what the transaction delivers

(e.g. raw materials or knowledge). One of the ways in which business innovation may

come about is when new partners are invited into the value network, or if partners within

the network take on new roles. For this reason it is important to discuss both present and

potential future configurations of the value network, a discussion that can typically take

mapping what is in place today as its starting point.

In Osterwalder and Pigneur’s (2010) process of business model innovation, the value

network is discussed as part of their ‘Business Model Canvas’. Using the metaphor of a

painter’s canvas, they suggest that new business models may be ‘painted’ on posters

preformatted with nine conceptual fields. For instance, the fields ‘key partnerships’ and

‘customer relationships’ on the canvas motivate participants to discuss who they

collaborate with. Osterwalder and Pigneur recommend that care is given to assemble a

diverse team of participants across the organisation for discussing business model issues,

and they suggest the use of a large print of the canvas with Post-itw Notes becoming

vectors for strategic discussion.

Den Ouden and Valkenburg (2011) propose mapping the value flows between actors as

coloured line-graphs on flipchart paper (Figure 1). Building on the actors’ network maps

Figure 1. Participants using coloured line-graphs to discuss the flow of goods, money, informationand intangible value between actors in a network (left), and, in another activity, acrylic shapes offlowchart symbols to depict a flow of activities (right). Workshop at Participatory InnovationConference 2011.

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(Morelli and Tollestrup 2006) and the value network analysis (Allee 2000), they

distinguish between the flow of physical goods, money, information and intangible value.

den Ouden and Valkenburg (2011) aim their work at social innovation initiatives that may

not start from the perspective of one particular company. In such projects, the network is

seldom stable at the outset, and the proper balancing of value exchange is an important

issue. They apply the Osterwalder business canvas for individual stakeholders and the

value flow model for the entire network alternately to ‘zoom in and zoom out’ in the

process (den Ouden and Valkenburg 2011, p. 315).

Lubbe (2011) proposes the use of acrylic shapes (Figure 1) as symbols to map business

processes in what he terms tangible business process modelling. With a set of physical

shapes corresponding to flowchart symbols (a widespread process modelling notation) he

encourages groups of participants to map processes of their company activities on large

sheets of wallpaper. He expands a tradition of business process modelling, claiming that

the detailed understanding of the organisation’s present activities is a precondition for

business model innovation. Lubbe’s prime argument for introducing the acrylic shapes as

a ‘thinking tool’ in collaborative sessions is that the cognitive load of working with

detailed process models is far too high to allow novice participants to engage without prior

training (Lubbe 2011).

All three approaches are proposed as collaborative: they aim to engage groups of

people in discussing business issues. Osterwalder and Pigneur’s (2010) canvas process

offers a coherent terminology to ensure a focused discussion; customer relations and

partner relations are included as fields in the canvas. Den Ouden and Valkenburg’s (2011)

value flow model introduces an element of visual mapping; the distinction between types

of values broadens the discussion of relations, although the coloured arrows restrict it to a

rather abstract level. Lubbe’s (2011) process modelling tool demonstrates the advantages

of tangible objects for organising team discussions. It maps activities, it does not model

relations between actors per se; but then one may claim that value exchange is always

related to activities.

In our work we have developed techniques for discussing value networks with an even

lower entrance barrier to enable participants without formal business education to engage.

In this article we focus on two techniques. In the first one, participants use physical bric-a-

brac to collectively make a tangible map of actors and relations on a tabletop. In the

second, participants themselves embody value network components and use an open floor

space to stage a larger, dynamic map.

These techniques were developed in ongoing participatory innovation activities (Buur

and Matthews 2008) with partners in both large and small companies and with graduate

students in university settings. Participatory innovation gathers theories and methods from

across different academic fields to describe how people outside an organisation can

contribute to its innovation, and identify ways for industry, the public sector and

communities to expand innovation through the participation of users, employees,

suppliers, citizens, members, etc., on a strategic level, in concrete methods and in day-to-

day interactions.

As for research methods, we work with a combination of action research and

interaction analysis. Action research here means repeated experiments in settings that have

an actual purpose of innovating their organisation (Reason and Bradbury 2001; Brandt

2005). As researchers we facilitate the events and include partners in reflecting on the

viability of the techniques afterwards. The sessions are video recorded for later detailed

analysis of the interactions between participants and with the material offered. As

facilitators of these experiments, we are mindful that it is difficult to avoid bias in our

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interpretation and evaluation of our data. This is why we rely on the ethnomethodological

method of conversation analysis (Heritage 1984). As an emic approach, conversation

analysis takes as its focus the real-time, in situ practices and actions of the participants.

This brings the benefit of sharp attention to the details of how the participants themselves

make sense of the situation (Heinemann et al., 2014) rather than subsequent reflections of

either participants and/or designer/facilitator.

What we find exciting about these two techniques is that the analysis of how they were

used in concrete business applications provides knowledge far beyond the tips and tricks

that make collaborative methods work. The analysis gives insight into rather fundamental

issues of how business model innovation may happen.

2. Tangible mapping: redefining concepts

Wewill use the first company case to explore how terminology plays into the innovation of

value networks.

2.1. The Servodan case

Servodan is a small Danish manufacturer of intelligent lighting control equipment for

office buildings. Recently, the company has developed a new lighting system based on

light-emitting diode (LED) technology. The lighting modules can be digitally controlled to

provide light in the tone of daylight, say, from reddish light in the morning to more bluish

in the middle of the day. The intended main selling points are increased well-being,

particularly in windowless rooms, and electricity savings. The system is new to the

market, and although Servodan has been in the building business for more than 50 years,

this is the first lighting module it has manufactured. At the initial point of contact with the

first author, it was clear to Servodan that this technology requires a new way of thinking

about their business. In a session with company directors we organised a tangible mapping

activity for three potential market segments (hospitals, schools and hotels) to understand

which actors the company already had relationships with, and which new relationships

would need to be established. This session – and many following – showed how tangible

materials make it easy for all participants to join the discussion, regardless of their

business expertise. We used the ‘silver set’, a collection of silver-coloured bric-a-brac on a

black tablecloth (Heinemann, Mitchell, and Buur 2009) (Figure 2). The silver set arose

from our previous experiences of facilitating business workshops with vastly less

homogeneous looking collections of bric-a-brac. We found that industrial partners

experienced some resistance to working with diverse assortments of multicoloured

materials. Participants had justifiably criticised our earlier toolkits, comprised of items

such as Plasticine, drinking straws, pipe cleaners, sponges, wooden building blocks, toilet

paper tubes and lollipop sticks, for appearing too unserious and unprofessional.

We have also experimented over the years with facilitating via a number of other

toolkits such as toy train sets, balls running through hamster tubes, multiple lengths of

feather boas, and large rooms full of real furniture, ropes and planks (Buur and Mitchell

2011). In addition, we have deployed bespoke responsive artefacts such as pinball

contraptions and ceiling-hung mobiles (Mitchell and Buur 2010). By comparison with

these more provocative and outlandish materials, the ‘silver set’ is much more readily

received by industrial participants.

Our use of tangible materials to support discussions is inspired primarily by their

deployment to support discursive practices within the participatory design community

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(Schuler and Namoka 1993). Within participatory design, banking on physical objects as

things to think with (Brandt 2005) in order to enhance collaboration between disparate

groups of participants has been very successful. There are similar examples in business

circles (Lego Serious Play; Gauntlet 2007). Using artefacts to support the mediation of

collaborative work is also argued for by research concerning very different practices such

as emergency service co-ordination (Petersson, Randall, and Helgeson 2002) and

healthcare (Xiao 2005).

By studying video recordings of these sessions, we have previously shown that

participants typically identify one particular salient property of an object and then use

that property to create a metaphor about the organisation’s situation (Heinemann et al.

2011). We categorise the different kind of properties invoked into three types: physical,

kinetic and iconic. Which particular property is invoked varies according to aspects such

as the context in which the objects are placed and whether the object lends itself to

being interpreted better in one way or another. Our research suggests that participants,

through working with tangible material, have a large variety of different paths available

to them; paths that affect the narration that is the end-result of these workshops.

Participants tend to use the salient properties of objects in very similar manners, namely

to create metaphors with what we call ‘negative associations’. In other words, the end

result, independently of which object is being used and of which property of that object

is invoked, is the creation of a metaphor that portrays an organisation’s relations as

fraught with matters of power differences, competition and struggles (Heinemann et al.

2011).

Let us take a closer look at how participants pick the tangible objects and how meaning

is given to them. This appears to happens in two ways, as we shall show in the following

analysis of an activity in the Servodan case. First, we shall present an instance of how an

object inspires people to find a matching component within their value network. Secondly,

we shall outline how at other moments, participants have a member of their value network

in mind, which results in their seeking out the most appropriate tangible object for this

component.

Figure 2. Tangible value network mapping with the ‘silver set’. Servodan directors and guestsdiscuss how a small electronics manufacturer may introduce a new technology to a particular marketsegment.

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The group that discussed hotels as a potential market segment for the new lighting

system had four participants: a SPIRE researcher (A), a consultant from the Danish

Federation of Industries (B), the company chief executive officer (CEO) (C), and a visiting

design director from another company (D).

In the example in Transcript 1, we see how strongly the properties of the objects help

participants to make associations about partners and their qualities. D suggests that ‘hotel

owner’ should be an item in the map. While they all search for an appropriate object (B:

‘It should look valuable’), B finds a curious shape in the box that they cannot quitemake out:

it looks like a small disco ball with mirror fragments but has a long spring with a clip

attached at the end. C then suggests a silvery shoe sole for the hotel owner (D: ‘The guywith

the large footprint!’), and they all agree. But B still appears puzzled by the disco ball, and

speculates that there must be something like a nightclub in the hotel. C helps out, offering

‘Restaurant, nightclub, wellness . . . ’, D categorises them as ‘facilities’, and C suggests that

they are ‘activities’. The disco ball ends up on themap representing hotel activities. This and

other examples we have seen strongly suggests that strange objects can help participants to

think of who the partners may be, and which qualities are important to communicate.

At other times, participants have in mind a particular actor that they wish to have

represented on the map, and use this identified need to seek out a suitable object. For

instance, several minutes later, in the same session, D is looking for something to represent

an ‘installer’ (Transcript 2). Here, the participants know which qualities they want to

communicate (he may pick a competitor), but the object still offers an additional

association (‘ . . . sits heavily on the deal’).

Through interaction analysis of the video recordings, we have previously shown how

participants co-construct meaning when building the tangible value network maps. What

an object communicates is a social construct that is dependent on the ongoing social

actions and the social order that needs to be established or maintained between

conversational partners (Heinemann, Mitchell, and Buur 2009). The objects work as

reifications of abstract understandings of the actors in a value network; they work as

physical metaphors. It is, however, not a simple process of ‘representing’ properties that

the group has decided beforehand; rather, the process works both ways: the participants

find forms that reify their discussions, and they take inspiration from the material

properties to think of something else.

Transcript 1. Participants search for objects to represent partners. (Transcripts from the Servodancase are translated from Danish.)

THE SHOE SOLE AND THE DISCO BALLD: There must be a hotel owner some place, one that plays a role. In the end, he is the one who pays.(A and B touch objects on the table)B: If it’s something about payment, it should look valuable.(A picks up a miniature disco ball with a spring attached)D: What is that for?A: I don’t know.B: But we were about to find something for you (D).C: What about this guy? (picks up a silvery shoe sole)B: Yes!D: The guy with the large footprint!B: But I also thought about this disco ball thing. In a hotel there must be something like a nightclub . . .C: Restaurant, nightclub, wellness.D: They are different types of facilities.C: Or they are activities that happen.

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We suggest that a likely explanation of why this tangible mapping technique works is

that the ability to innovate business models relates to the freedom of redefining the

terminology used by participants. By opening up the definitions of the words used to

describe products, services, values, resources, etc., it becomes possible to question and

reconsider dominating conceptions and see new opportunities. The physical objects, with

no apparent connotations relating to business, serve as ‘things to think with’ as in the

design tradition. They help to stimulate social construction of new meaning in groups

across company functions and even company boundaries.

3. Staging: redefining roles and relations

We will use our second company case to study how the perception of roles and relations in

a value network is crucial in innovating the business model. Interactive staging of business

models allow the whole business model to be seen from many angles – literally.

3.1. The Gloveler case

Gloveler is a start-up company offering its customers (business travellers and tourists) the

possibility to book private accommodation online at the platform www.gloveler.de.

Before the launch of sites such as Gloveler, people relied mainly on the telephone when

booking private accommodation in Germany, unlike booking a hotel room, which can be

achieved comfortably via numerous websites, e.g. www.hrs.de. The first version of the

website was launched in March 2009, and updated in an all-new version in July 2010.

Gloveler provides an online platform on which the proprietor can find new tenants for

spare rooms, rooms offered especially for fairs, bed & breakfast, and holiday homes and

apartments. As of June 2011, more than 30,000 beds were listed on the platform.

Gloveler’s current business model is transaction based: Travellers pay a 10% commission

for each booking to Gloveler. For landlords it is free of charge to post a listing. In the

future, additional revenue is expected from subscription fees for online property

management software provided by Gloveler for landlords as a Software-as-a-Service

solution. At the time of writing, Gloveler has 11 employees, including the three founders.

The first author’s engagement with Gloveler came about when the company reacted to his

general invitation through a network of high-tech start-ups. The collaboration so far had

been organised as two participatory workshops in German, the first held at the university in

March and the second in the company office in July 2011. In both workshops the one-hour

staging activity was video recorded for later analysis.

Transcript 2. The installer is heavy and unpredictable like a bocce ball.

The PETANQUE BallD: Isn’t there a danger that the installer wants to make energy savings, but he picks someone elsethan you?C: Certainly, that’s the way it is.D: So how would you model this?(Everybody looks towards the objects)C: You said it yourself – the installer may roll in different directions (picks up a heavy petanqueball)B: Yes, and sits heavily.C: . . . and sits heavily on the deal.

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At the first workshop, two of Gloveler’s founders participated along with six master

students and the second author. To focus the exploration, the moderator (second author)

initiates a Post-it session around the ‘Business Model Butterfly’ (Ankenbrand 2011). The

butterfly model was developed as a simplified alternative to the Osterwalder canvas

(Osterwalder and Pigneur 2010) for visualising business models. It is a template that

features five elements (Figure 3): The thorax of the butterfly shows the value proposition (1),

while the right and left forewings represent customer segments (2) and key resources (3).

The right and left hindwings represent the revenue streams (4) and the cost structures (5).

Through the Post-it session the Gloveler founders realise that the distinction between

the private customer segment (travelling families), the professional segment (travelling

installers or fair participants) and the accommodation landlords – and communication

among them – is not perfectly clear in the company’s market positioning (Figure 3).

Therefore, the moderator suggests a focus on this issue in the staging process. The six

students take the roles of three customer segments (blue- and white-collar travellers,

private travellers), competing booking platforms, landlords, and small brokers of private

accommodation. The two founders together act as the Gloveler booking platform.

Then the process starts. The participants stand in a rough circle in the space. The

moderator urges them to spread out and ‘find a spot in the space that feels right’. One by

one the participants briefly present who they are, and how they see the needs and

preferences of their role, and they try to position themselves in the room in relation to the

other roles. They discuss as they discover their ‘optimal’ position. The moderator

Figure 3. The ‘Business Model Butterfly’ used with Post-it Notes to clarify who the actors are inthe Gloveler value network. On the right it can be seen that the customer segmentation is not quiteclear.

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challenges them to consider gaze (who are you mostly relating to?), body orientation (who

are you orienting towards?) and distances (how closely are you collaborating?).

Similarly to how our use of tangible objects in facilitating discussions draws upon

related approaches in participatory design, our staging is mindful of many attempts to

incorporate performance techniques in design processes. Medler and Magerko (2010)

helpfully highlight that much of such work draws upon either improvisational theatre or

role-playing. The former has long been employed in interaction design projects to

brainstorm new product ideas through acting out full interaction scenarios (Mackay,

Ratzer, and Janecek 2000) or ‘bodystorming’ (Bucheneau and Suri 2000, p. 428;

Oulasvirta, Kurvinen, and Kankainen 2003; Schleicher, Jones, and Kachur 2010). Role-

playing activities have also been popular as a means to boost empathy with users through

envisioning current and future practices with new technologies in interaction design

projects (Burns et al. 1994; Simsarian 2003; Boess 2006). In service design, role-play can

also be of great utility as it offers a means of ‘rehearsing’ services (Penin and Tonkinwise

2009). Although at first glance our staging activity may appear quite similar to both

bodystorming and role-play, it differs in several respects. First, in both of the established

approaches, the informal improvisation concerns actions and relations of a quite different

scale. In bodystorming and role-play, participants improvise their actions and responses to

imagined real-use contexts for products and services. Thus, the scale is typically one-to-

one. In contrast, our staging activity involves participants individually embodying the

relative positioning and orientation of whole organisations.

Our work also blurs the distinction made by Medler and Magerko between these two

approaches. Role-playing, especially when used to simulate situations in office

environments, has an emphasis on verbal interactions. The experiences we offer are full

bodied but avoid the drawbacks of bodystorming pointed out by Oulasvirta, Kurvinen, and

Kankainen (2003), namely that participants concentrating on how they act reduces useful

creativity and reflection. Or, as Buchenau and Suri (2000) admitted, a weakness of

bodystorming can be that participants ‘direct energy away from understanding the

experience to acting as if you were having the experience’.

Embodying the different components of a value network requires no such performance

energy as there is no audience. Participants in our activities do not act out roles, they

merely try out positions ‘on stage’ to get a feeling for how they relate to one another in a

physical manner. This connects with conceptual drama approaches through which spatial

metaphors for abstract thought are taken literally and played out bodily (Cole 1978), and

drama training techniques that focus on the relative spatial position of actors (Climenhaga

2009). However, our staging is not about preparation for performance to any kind of

audience. Its explorations of intragroup topologies share qualities of immersiveness and

accessibility with playful improvisational theatre positional exercises such as ‘Bomb and

Shields’ (Johnson 2005, 122) and ‘Points of Contact’ (McCarthy and Galvao 2004, 28),

many of which have also made their way into community development handbooks

(McCarthy and Galvao 2004). Referencing a range of theatrical sources may suggest that

our staging activity is about performing rather than designerly qualities such as exploring

and evaluating. However, we align our staging activity more with drama training than with

theatrical performance: we are motivated by increasing participants’ understandings of

themselves and each other in relation to a business development situation.

The staging sessions usually result in joyful and insightful discussions with sometimes

surprising perceptions. Through the personification, participants seem to replace abstract

conversations about business with concrete, empathic explorations of what could be, and

what it would feel like. In the segment described as Transcript 3, we see how the

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accommodation broker suddenly takes a much more central role than anticipated by the

Gloveler founders (Figure 4).

In this sequence the broker introduces herself, then suggests a position in the middle of

the circle of other actors – ‘ . . . as if I had a thousand arms reaching out to everyone’.

Triggered by a moderator question, this move elicits a discussion of Gloveler’s standing in

the market. The platform, represented by the two Gloveler founders, repeatedly tries to

investigate what it would take to move Gloveler from an indistinct position in the

periphery closer to the Broker as customer (‘ . . . if Gloveler were able to point to all other

sites?’ and ‘ . . . how would you keep an overview . . . ?’).

From the expressions of surprise viewable in the video, it becomes clear that prior to

this sequence, the Gloveler representatives had not counted on private brokers as serious

competitors to their service, and that they are not comfortable with a position in the

periphery, along with other sites and competitors, rather than in a central market position.

Although the participants needed to be encouraged to express the tension they felt due to

their positioning, the insight derived is very valuable. We point out that the personal

experience of ‘periphery’ and ‘centre’ is entirely tied to the spatial locations of the

participants. It is the concrete experience of actually standing in such an ‘arrangement’

that brings about reactions from the participants.

The second workshop included four employees of Gloveler, a master student and the

first author. After a recap of the findings from the first workshop the group decides to focus

on the differentiation of Gloveler’s value propositions: what would happen if the company

split its offer into a booking site for customers and a new booking engine including online

accommodation management software provided by Gloveler for landlords as a Software-

as-a-Service solution? The master student assumes the role of the travellers, a business

development manager takes the role of the competitors, an entrepreneurship intern plays

landlords, and the founders take the roles of, respectively, the booking platform and the

new booking engine currently under development (Figure 5). The participants by then

know the method and are more comfortable in expressing their observations and

repositioning themselves and others in the staging.

During the first moves, the participants position themselves in such a way that the

Gloveler platform and its competitor constitute a line across the line of sight between the

accommodation landlord and the traveller (customer), as shown in Figure 6 andTranscript 4.

The landlord explains that ‘I want him’, pointing to the traveller, but he needs to use

either Gloveler or a competing platform to reach the (potential) customer. As both

Transcript 3. The student playing the role of Accommodation Broker tries to find her positionbetween Customers, Booking Platform and Competitors.

BROKER MOVES CENTRE STAGEBroker: . . . so I should stand in the centre as if I had a thousand arms reaching out to everyone butthe private customer?Moderator: What would increase your loyalty to the Gloveler platform?Broker: Well, I would need it, but only among many others. So you wouldn’t be the most importantone for me.Platform: And if Gloveler were able to point to all other sites . . . if you had a central organiser for allyour contacts?Broker: That would of course be a reason to concentrate more on you than on your competitors.Platform: And how would you keep an overview, if bookings come in from here, here, and here, soyou don’t double book?Broker: That’s a good question. For that I would need a good software. (laughter) I must admit thatattracts me.

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Gloveler and the competitor are completely oriented towards the customer, the landlord

sees only their backs, getting less attention than he might prefer. As the landlord can see

the traveller (his customer) directly, the platforms seem a necessary evil to get what he

wants. Gloveler finds himself being lined up alongside a competitor, and thus this

participant tries to ensure that at least they are located at the same distance from the

customer (‘ . . . on the same level’), which leads to some clearly observable amusement in

the group. Although this is only an act, the Gloveler participant is seen to react based on

his bodily experience of being ‘too far away’ from the action between competitor and

customer; and the representative of the competitor also senses his move to close up.

We have traced the collaborative discovery process that was brought about in the two

staging workshops. Our many years of experience as both facilitators and participants in

innovation workshop activities lead us to state that the video documentation strongly

suggests that the participants in these workshops took their roles seriously. By accepting

Figure 4. Gloveler representatives and graduate students in a staging activity, workshop 1. Themoderator is off-camera.

Figure 5. Gloveler representatives in a staging activity, workshop 2. The moderator is off-camera.

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the various roles relating to a business model, participants come to personify with those

roles. The discoveries occur when participants react on their immediate, bodily experience

of distance, line of sight, etc., to the other participants, and when they relate that to the

broader understanding of marketplace and partnerships. Wagner (2012), in analysing the

same video segments, has shown that laughter plays an important role in the activity.

Participants laugh when one or more participants reposition themselves and thus breach

the game order (Wagner 2012): precisely when participants discover a new way of looking

at each other’s roles and relations. Wagner also notes the difference between how

company representatives with an actual stake, and participants from outside, act. We

observe that the combination of inside and outside views is probably necessary to bring

about the discovery process.

The way we have come to explain the success of the staging process is that to innovate a

business model we need to be prepared to rethink roles and relations in the value network.

Acting is a simple and fast way of experimenting with new roles and relations. The staging

process turns abstract business relations into something that people can actually experience,

and their experiences of line of sight, relative distances, etc., in the physical space make

them think about how business relations in ‘real life’ may change in similar ways.

4. Business innovation as design moves

The concept of ‘design moves’ can help us to understand how the experiments with

redefining concepts, roles and relations may foster innovation. Schon (1992) argued that

Transcript 4. Participants locate themselves in the space to show how the business partners wouldrelate to one another. (Transcripts from the Gloveler case are translated from German.)

COMPETITORS ON THE SAME LEVELTraveller: I think I’ll stand in between. I look at the different platforms on the Internet and enjoy theones with a broad offer of holiday apartments.(5min later)Platform (looking and pointing at landlord): Then the positioning isn’t quite complete.Landlord: I would stand behind you two, theoretically; I want him (points to traveller), I look on theInternet how to get there.(1min 20 sec later)Platform: But we (Gloveler þ competitor) would be on the same level, really. (laughter).Competitor: No, get back (laughter) . . . .

LandlordCompeting bookingplatform

Traveller

Gloveler bookingplatform

Figure 6. Landlord and traveller can see each other, but the Gloveler platform and its competitorsact as a filter between them. Gloveler realises that he should be level with the competition and stepscloser.

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an essential part of a designer’s practice when developing design concepts is to make mini-

experiments or ‘moves’. These may take the form of lines on a sketch, or material

rearrangements, which are then evaluated and suggest further new moves and courses of

action, in a ‘seeing–moving–seeing’ process (Schon 1992, p. 5). In our cases participants

are not designing buildings or products per se, but the business innovation activities we

engage in carry traits quite similar to design practice. Participants are not literally drawing

on paper like the architects in Schon’s exemplar but we may look at the use of objects and

the play with people as alternative ways of ‘drawing’ futures.

Central in Schon’s work is the role of qualitative judgements as ‘appreciations’ of a

new situation. With a new move, an intention is not fully established at the outset, but

develops through appreciations, as a ‘conversation’ with the process of transformation. He

suggested that we should see designing as ‘a reflective conversation with the materials of a

design situation’ (Schon 1992, p. 175). Similarly, in the mapping and staging methods we

describe here, participants cannot appreciate the new situation they intend until they have

made a move (suggested a new silver object, shifted its position on the board or moved

themselves into a new position in the space). Once they move, the new situation will

provide what Schon called ‘backtalk’ in how the new situation is seen or felt, in how other

participants react, and so on.

What can we learn by looking for ‘design moves’ in the two cases? We have identified

two different kinds of move that seem to have significant importance for innovation to

happen: concept shifts and role shifts.

Concept shifts are moves in which participants discover new meanings of the words

they use. In daily conversation, the meanings of words we use are seldom up for

discussion. But with the tangible objects that from the outset have no connotation relating

to the business under discussion, every object poses a question as to what we mean by the

concepts. The connotations become explicitly socially negotiated. The moves here are

associated with actual moves of the tangible objects.

An example from the Servodan case will show how such a ‘move’ in conceptual

understanding can come about. Here, an object (a wire brush) provides an incentive to

question whether the very concept that is discussed is relevant, and what precisely it

means. Early on, participant A makes a move in suggesting that a metal wire brush should

Transcript 5. What does ‘cleaning’ actually mean?

DOES CLEANING BELONG HERE?C: This cleaning there, I have difficulties relating to that.B: Well, I thought with cleaning it’s the same. With the light you have, for instance if you werepainting you can’t paint at night, because the light is wrong.C: That’s then the advisor, who says we need cleaning light. Servodan needs to provide cleaninglight, when you push a button. A requirement.B: But there might be environmental health regulations . . .D: There would be something about cleaning: If a fly finds its way under the white screen and getsinto the light.C: Then it’s a product property, what the company delivers.D: You don’t like this cleaning very much, do you?C: Well, it’s just that I . . . In my view it is difficult to see what influence cleaning would have as aninstitution between people, because other people design it in. ( . . . )D: Is it always the hotel itself that does the cleaning? Couldn’t it be outsourced?C: Of course it could, but it’s still them that need to pay for the service.D: But the price of cleaning will depend on many things. Also on whether your surfaces are easy toclean. ( . . . )C: OK, it could be the employees more generally.

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represent ‘cleaning’. All nod consent, except for C, who has just left the table briefly to

fetch Post-it Notes, so that the team can write down what each object means. C returns and

starts writing out Post-it Notes for each object; in a sense, as the CEO he ‘signs off’ on the

decisions that the group has made one by one. When he reaches the wire brush he asks,

‘And this was what – cleaning?’ He does write down the word, but a little later he picks up

on the concept (Transcript 5).

While C struggles to find ‘cleaning’ relevant, the other participants offer various

meanings to the object: cleaning light, environmental health regulations, ease of cleaning,

an institution, a cleaning service, cleaning cost. So although they in the first instance agree

that ‘cleaning’ needs a place at the table, the very meaning of the concept comes up for

discussion. In the end C concedes that if they think of it more broadly in terms of hotel

employees the wire brush makes sense. This reflective fluidity, we claim, is one

precondition for innovation to occur: the willingness to question the very meaning of the

concepts we use in daily conversation, and make moves in the form of ‘what if it meant

something different?’

Role shifts are moves in which participants discover different configurations of the

roles the actors play. In real life it may be difficult for actors to imagine that they should

change their role; the very activity and purpose of what they do. Furthermore, it is difficult

to change roles unilaterally since roles are essentially relative: people and entities are

defined by reference to others, whether as individuals (e.g. parent–sibling) or

organisational (e.g. customer–supplier). But in role-play, exploring different roles is

precisely what is easy and encouraged: we can simply imagine we are someone else, or

that we do something else. The moves here relate to participants physically moving about

in relation to each other.

In the Gloveler session, there is an example of a very physical ‘move’ (Figure 7). At

this point there are four people in the room: Gloveler’s booking platform is positioned next

to a competing booking site, both standing between the customer (traveller) and the

service provider (landlord). The landlord notices that he can only see the two booking sites

from the back, as they are facing the customer.

A fifth person enters the room in the role of the potential new product: a booking

engine directly addressing the needs of the landlord. After some discussion, the

participants realise that the newcomer should actually stand back-to-back with the present

Gloveler booking platform, as they belong to the same company, but address customers

‘front stage’ and ‘back stage’. So now the landlord stands face-to-face with the new

booking engine. This suddenly changes the configuration and opens up a partnership

between the Gloveler booking engine and the otherwise competing booking site.

This is a fine example of a move made by one participant, in which he suggests a role

added to the network. When entering, he cannot appreciate the consequences of what he

suggests, but in the ‘reflective conversation’ with configurations, suddenly all participants

experience through their bodies that the relations change and thus open up for other

business opportunities.

The development of the new booking engine idea took place between workshops 1 and

2. We will not be able to prove empirically how much the workshops contributed to this

idea, but from the reactions of Gloveler executives we can say with some confidence that

the staging process helped them to think through what potential lay in the new value offer,

and how it might change the relations between Gloveler, its customers and its competitors.

Armin Harbrecht, one of the founders of Gloveler, shared his view with us: ‘The two

workshops influenced and strengthened our decision for the new positioning of Gloveler in

the competitive market. The methodology of staging our business model provided us with

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a new view on our relations with customers and competitors. Furthermore, it was a great

way of communicating our strategic thoughts within the Gloveler team’.

The two methods bank on very different mechanisms but apparently achieve similar

results: one relies on reifying the value network partners with tangible objects, whereas the

other relies on participants themselves personifying with the value network partners. Both

end up with a spatial map of the value network (on the table or on the floor) through which

the participants show that they have expanded their knowledge about who the stakeholders

are, which roles they play, and which relations they have to the product/service, and to

each other. In Table I we briefly compare the properties of the two methods.

In both cases we recognise Schonian design moves that drastically make participants

discover new potential relations in their value network. In case of the tangible mapping the

appearance of a new actor (cleaning), and in the staging case a potential role shift (competitor

turns partner) is triggered by a diversification of the value offer. The moves constitute small

experimentswith positions, roles andmeanings that trigger backtalk, both in participants’ own

experience of the new situation and in how the other participants respond.

5. Conclusions

We will claim that our research points two ways: not only can we better understand why

the two methods seem to ‘work’ in engaging participants in innovative conversations, we

Table 1. The main properties of the two methods.

Method Tangible mapping Staging

Partners are represented by Objects in relative positions onboard

People in relative positions inroom

Relations are represented by Connecting elements Body orientation, view, distanceWorks by Reification PersonificationMoves appear in the formof

Objects change meaning People shift their position

Moves are triggered by Physical metaphors Spatial experience

Landlord Competingbooking platform

Traveller

New glovelerbooking engine

Gloveler bookingplatform

Figure 7. The booking engine moves in back-to-back with the Gloveler platform, blocking the lineof sight between landlord and traveller. This suddenly turns the competitor into a partner.

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are also able to make statements about how innovation comes about. We suggest that the

methods of tangible value network mapping and of staging business relations support two

types of design moves that are both central to innovating business models. One is daring to

question the concepts that we use in daily conversations. The tangible objects in the value

mapping activity bank on reification of abstract issues and encourage the questioning of

conventional concepts and the co-construction of new meaning. The other kind of design

move supported is suggesting shifts in the roles that actors play in a value network in

relation to each other. The staging activity introduces personification with the various roles

in a value network and encourages experiments with new or altered roles and immediate

feedback on what opportunities such role shifts would offer. Both methods will move

company employees out of their comfort zone and thus potentially create openings for

innovative thinking.

Acknowledgements

This article is based on presentations and discussions at the Participatory Innovation Conference inSønderborg in January 2011. In the conference track ‘Designing Innovative Business Models’ theauthors met and saw how their different approaches might compliment each other. We are indebtedto our industry partners at Servodan and Gloveler for playing along with the rather experimentalapproaches and making them make sense. Also thank you to our graduate students and colleagues,who supported the activities and the ensuing analysis of video recordings.

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