Innovation & Risk Management Report: Open Innovation in Singapore

This report, prepared for the Council of Industry, Innovation and Science, investigates open innovation best practices in Singapore's service sector. It begins with an introduction to the service sector's importance in Singapore's economy, highlighting its growth and the need for innovation. The report analyzes key aspects such as timelines, personal capability assessments, and a literature review covering collaborative networking, technology insourcing, and joint ventures. The analysis includes application of theories to the service industry, and real-world examples. The report concludes with key learnings and references, emphasizing the importance of continuous innovation for the sector's advancement. The report also includes a personal assessment of weaknesses and proposed solutions for improvement.

Innovation & Risk Management
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Table of Contents
Summarization of Report Plan...................................................................................................3
Introduction................................................................................................................................3
Chosen Industry.....................................................................................................................3
Key Analysis..............................................................................................................................4
Timeline.................................................................................................................................4
Personal Capability Assessment................................................................................................5
Weaknesses............................................................................................................................5
Solutions.................................................................................................................................5
Literature Review.......................................................................................................................6
Collaborative Networking for R&D.......................................................................................6
Technology insourcing...........................................................................................................6
Joint venture and strategic alliance in open innovation.........................................................7
Conclusion..................................................................................................................................8
References..................................................................................................................................8
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Summarization of Report Plan
Section Content
Introduction Explanation about the report and information about chosen
industry
Timeline To meet deadlines and what is to be done
Personal Capability
Assessment
To identify weaknesses and ways to resolve them
Literature Reviews To identify how theories work and how to apply them to service
industry of Singapore
Conclusion Lessons learnt in entire assignment
Introduction
Chosen Industry
The significance of service sector in the economy of Singapore has increased steadily with
time, mostly in the last decade. Tremendous transformation has been undergone in service
sector over the years as small scale and family owned miscellaneous services drove higher
skilled and higher value-added activities like financial and information technology. The
service sector is comparatively more stable than other sectors and acts as a buffer during
periods of economic recession (Economics Department Monetary Authority of Singapore,
1998).
Singapore has dropped down in ranking in the context of innovation capabilities and
outcomes as it ranked seventh in the Global Innovation Index 2017. It has slipped from sixth
position, which has seen Switzerland dominating the graphs for a seventh successive year
now. Singapore is planning to drive $19 billion in the science and technology sector in the
next five years to become a 'go to' destination as a global innovation and entrepreneurship
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hub (Sirito & Hasan, 2018). It will create a vibrantly diverse centre for innovation and
nurturing the kind of workforce skills and talent essential to achieve success in the integrated
global economy of the present scenario. In this context, open innovation may be critical in
boosting the innovative capacity of Singapore. So, I have been asked by the council of
Industry, Innovation and Science to prepare a report on open innovation best practice round
the globe. The report will draw upon theory and real-world examples of effective open
innovation practices emphasizing on Service organizations of Singapore.
The service industry of Singapore has noticed revenue growth in the last quarter of 2018
despite its slower rate as per the data obtained from the Department of Statistics. The overall
revenue growth has been noticed to be 4.1% higher than the previous year. The revenue
growth for the entire year is 6.8% for 2018, which is like the growth in 2017 (Department of
Statistics Singapore, 2019). However, maximum revenue has been generated in 2017 through
wholesale and retail trade while in 2018, maximum revenue growth has been generated from
finance and insurance sector (Leow, Singapore service sector takings up 7.8% in Q2, 2018).
The information and communications service industry has shown improvement as revenue
has increased to 7.2% and financial and insurance sector rose to 6.9%. All the sectors in the
service industry have shown growth in revenue generation but the revenue has declined by
2.6% in education sector and by 1.3% in recreation and personal services (Leow, Growth in
Singapore services sector revenue eases to 4.1% in Q4, 2019).
Key Analysis
Timeline
Dateline/Milestone Task/Activities
Start Date: 13th June 2019 Completion of report framework
15th June 2019 Research on Service industry of Singapore
16th June 2019 Research on innovation in industry and on previous innovations
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17th June 2019 Search for journal articles related to service industry
27th June 2019 Start report and application of theories to the service industry
30th-29th July 2019 Lecture Consultation
30th July 2019 Report vetting
1st August 2019 Completion of final report for Assignment 3
End Date: 3rd August 2019 Submission of report via Turnitin
Personal Capability Assessment
Weaknesses
Lack of time management- As I must undertake so many assignments at a same time, I
always have difficulty in managing the time. For example, it happens many a times that I
have deadlines of two to three assignments to be submitted. In such a situation, I become
unable to manage my time to submit all the assignments on time.
Difficulty in understanding guidelines- It occurs usually that I misunderstand the guidelines
of the assignments. It results in inappropriate completion of assignment and I become unable
to score good marks in my assignment.
Solutions
Timetable- In order to overcome the issue of difficulty in time management, a timetable
should be prepared to be followed strictly. The timetable should include lecture time and
revision time after attending lectures so that there will be even distribution of each module
and their respective assignments.
Assistance from others- In order to get rid of this issue, it would be great to take assistance
from the teachers, seniors and friends so that I could understand the guidelines of my
assignments effectively.
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Literature Review
Collaborative Networking for R&D
The study conducted by Kim, Kim, Suh, and Zheng (2016) has analyzed four different types
of collaborative activities on the R&D performance of service SMEs. The four collaborative
activities are in-house R&D, technology acquisition, R&D collaboration and networking. The
research study has been conducted and results have shown that technology acquisition is the
best type of collaboration for R&D in the service industry. Traditionally, R&D activities in
the context of open innovation have been considered as important inputs for innovation. R&D
expenditures in the service sector are continuously increasing. These expenditures are aimed
towards improving product development and production process by increasing internal and
external R&D activities (Kim, Kim, Suh, & Zheng, 2016).
Technology insourcing
The insourcing is considered as the process to bring previously outsourced positions and
departments back in house. Some services industry such as technology-based businesses have
been making efforts to break their boundaries through implementation of more open
innovation processes (Hatem, 2016). The cooperation as inbound open innovation practice is
defined as the active participation in joint R&D as well as other technological innovation
projects with other organizations. The sourcing is related to the utilization of ideas and
technologies sourced from outside of the firm through participation in external innovation
projects. The insourcing includes activities such as informal networking and customer
involvement. The firms can get benefitted from complementarities in the form of creative
ideas from external actors and to obtain opportunities to develop and market new products or
services. However, the knowledge acquired by a firm through sourcing is limited and the
relationship between searching activities and innovative performance is curved.
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Open innovation works rather differently among service industry because the role of
customer is different in various service business and the customers are often involved in an
iterative process with the company that results in a customer experience. In addition,
innovation processes work in a different way in service sector (Virlée, Hammedi, & Parida,
2015). There are few companies that have formal R&D operations for the services being
provided by them and the customer might need to contribute through the service innovation
process. Some of the concepts of open innovation apply readily to the service innovation, for
example, Amazon has created open service innovation by taking the “outside in” think of
customer reviews on its site and third parties selling products through its site and by taking
the “inside out” by utilizing internal knowledge and infrastructure to develop business selling
cloud computing services to various companies. The service sector companies interested in
open service innovation can use techniques such as working carefully with the customers to
develop new solutions; directing contributions on utility for customers instead of products;
and inserting the company in the organization of customers (Chesbrough, 2011). The
companies that have conventionally been product-oriented might need to make some
organizational changes such as changing service pricing while moving towards service-
oriented approach.
Joint venture and strategic alliance in open innovation
The strategic alliances are becoming highly popular in global markets and they can be
defined as voluntary arrangements between firms involving exchange, sharing or co-
development of products technologies or services. There has been growing interest in
understanding why firms form strategic alliances and the factors that influence their success.
In the pivotal work conducted on joint ventures, a kind of strategic alliance, their motivations,
applicable also to other types of alliances, have been taken into consideration the
transactional costs, enhancement of competitive position and acquisition of knowledge
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(Arrigo, 2012). In actual, the firms within a strategic alliance can improve their performance
through several sources such as through scale economies, effective risk management, cost-
efficient market entries and specifically, learning with partners. The service industry of
Singapore can utilize this approach with regards to the factors that influence the success of
joint venture and strategic alliance, it has been noticed that the strategic actions of the
companies are affected by the social context, in which they are embedded which is
represented by the relationships with the partners of the network.
Conclusion
In this assignment, I have learnt that innovation must continue to evolve in the service
industry of Singapore in order to progress and contribute to the economy of the country. The
innovation is essential in the industry to eliminate stagnancy and ill progress. Three theories
that have been taken into consideration could be applied to the service industry of Singapore.
With the application of R&D in the service industry, innovation could be applied, insource
technology can advance the operations in the industry, and joint venture and strategic alliance
could help in expansion of the business. So, innovation should be implemented in the service
industry of Singapore.
References
Arrigo, E. (2012). Alliances, Open Innovation and Outside-in Management. Symphonya
Emerging Issues in Management(2), 53-65.
Chesbrough, H. W. (2011). Bringing Open Innovation to Services. MIT Sloan Management
Review, 52(2), 85-90.
Department of Statistics Singapore. (2019). Singapore Service Sector 2017. Retrieved from
singstat.gov.sg: https://www.singstat.gov.sg/modules/infographics/singapore-services-
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sector
Economics Department Monetary Authority of Singapore. (1998). Singapore's Services
Sector in Perspective: Trends and Outlook. Retrieved from mas.gov.sg:
http://www.mas.gov.sg/Monetary-Policy-and-Economics/Education-and-Research/
Research/Economics-Staff-Papers/1998/Singapore.aspx
Hatem, L. (2016). Three Challenges when Insourcing Technology. Retrieved from
linkedin.com: https://www.linkedin.com/pulse/three-challenges-when-insourcing-
technology-laurence-hatem
Kim, S.-j., Kim, E.-m., Suh, Y., & Zheng, Z. (2016). The effect of service innovation on
R&D activities and government support systems: the moderating role of government
support systems in Korea. Journal of Open Innovation: Technology, Market, and
ComplexityTechnology, Market, and Complexity, 2(5).
Leow, A. (2018, August 27). Singapore service sector takings up 7.8% in Q2. Retrieved from
straitstimes.com: https://www.straitstimes.com/business/economy/singapore-service-
sector-takings-up-78-in-q2
Leow, A. (2019, February 27). Growth in Singapore services sector revenue eases to 4.1% in
Q4. Retrieved from businesstimes.com.sg:
https://www.businesstimes.com.sg/government-economy/growth-in-singapore-
services-sector-revenue-eases-to-41-in-q4
Sirito, P., & Hasan, M. (2018). Open Innovation in Service Sector. Proceedings of the
International Conference on Industrial Engineering and Operations Management (pp.
352-360). Bandung: Indonesia.
Virlée, J., Hammedi, W., & Parida, V. (2015). Open Innovation Implementation in Service
Industry: Exploring Practices, Processes and Contextual Factors. Journal of
Innovation Management, 3(2), 106-130.
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