Developing Creative Contexts: the challenge of

articulating value

Dr Lorraine Warren, School of Management, University of Southampton, Highfield, Southampton, UK, lw4@soton.ac.uk

Fátima São Simão, PINC – Creative Industries Centre of the University of Porto’s Science and Technology Park (UPTEC),

University of Porto, Portugal, fatimasss@uptec.up.pt

Presented in Barcelona, 5-6 May 2011, Creative Regions in Southern Europe: Challenges and Opportunities

Overview

Developmental paper, examines the dynamics underlying value creation at the PINC Creative Industries incubator at the University of Porto’s Science and Technology Park (UPTEC).

Background Conceptual underpinnings – Complexity theory (Fuller

and Warren 2008-11, ongoing) The case (Sao Simao, Director, ongoing) Future questions – creating and capturing value

2. Background: Creative industries within EPSRC CREATOR Project

Empirical research: Tracking co-creation in projects between groups of technologists and artists

Proboscis’ Sensory Threads project (people, their health, the local geographic context …) http://socialtapestries.net/sensorythreads/index.html

Gesture and Embodied Interaction workshops at Newcastle and Cambridge (motion capture) 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/

MiPP Platform (Sussex) Connecting mo-cap to architectural heritage

SETsquared incubators (Southampton, Bristol, Surrey, Bath): case of PINC

Value?

Major source of innovative ideas that contribute to the development of new products and services

Offer services that may be inputs to the innovative activities of other enterprises and organisations within and outside the creative industries

They are intensive users of technology and often demand and create adaptations and new developments of technology, providing stimulus to technology producers.

Technical, social, creative, artistic, cultural, societal…..and of course economic -> REGIONAL DEVELOPMENT

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Importance of the Creative Sector for the Portuguese Economy (1)

International Evidence

The Cultural and Creative Sector in Portugal, Augusto Mateus & Ass. for the Ministry of Culture, 2010.

In 2006, the cultural and creative sector was responsible for 2,8% of the global wealth generated in Portugal, as well as 2,6% of the employment in the country;

The average employment growth was 4,5%, between 2000-2006, against the global 0,4% national trend.

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Importance of the Creative Sector for the Portuguese Economy (2)

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The Cultural and Creative Sector in Portugal, Augusto Mateus & Ass. for the Ministry of Culture, 2010

When compared with other European Countries, in terms Creative and Cultural Sector, Portugal finds itself somewhere between the most developed economies (like the UK) and the emergent and transition ones (like Poland);

Fragilites in terms of international trade: lack of support activities to the sector; difficulties in articulating strong production with weak distribution system; difficulties in valuing the Portuguese language internationaly.

Importance of the Creative Sector for the Portuguese Economy (3)

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Importance of the Creative Sector for the Portuguese Economy (4)

A Macroeconomic Study for the Development of a Creative Industries Cluster in the North Region of Portugal, held in 2008, defined a strategy based on three main strands:

3.creative entrepreneurship and capacity;

4.growth of creative businesses;

5.attractiveness of creative places.

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The Development of a Creative Cluster in the North Region of Portugal (1)

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Promote Clustering Promote Business Incubation Provide support services to entrepreneurship Provide support to copyright and other legal issues Facilitator between Education and Cultural Institutions, companies and creative professionals Establish partnerships and networks Promote transversality among creative sub-sectors Produce knowledge about creative economy and econlogy Informe and engage the creative community Develop the local and global market (through distribution mechanisms) Develop collaboration projects focused on urban regeneration Promote innovative buiseness and organizational models Promote the sector’s visibility in the region, in the country and in the world.

The Development of a Creative Cluster in the North Region of Portugal (2)

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So far (some examples)…3 Creative Business Incubators, in Porto: InSerralves, PINC (University of Porto - UPTEC), Aquário (Catholic University)Participation in international networks and partnerships (eg: CIW, ECBN)Organization of the annual event Creative Portugal (conferences, workshops, exhibitions, performances…)Preparation for Guimaraes 2012 – European Capital of CulturePreparation for Porto 2.0 – 2 years creative activities programme in PortoOpening of the Creative Industries Masters Programme at Catholic University …

The Development of a Creative Cluster in the North Region of Portugal (3)

The University of Porto’s Case Study:

PINC - Creative Industries Centre UPTEC and INESC Porto Close to research and courses in communication

sciences In town center to contribute to urban regeneration

(currently 1800m2) Large area open to projects in collaboration with other

institutions (U. Católica, IPP/ESMAE) Core Media companies (Público, Rádio Nova, LUSA,

Gema, UPMedia), 15 incubated, 5 pre-incubation and 7 virtual incubation (109 direct jobs)

Stimulating collaborative projects: P3.net, OSTV, loveblip.pt, escolinhas.net, …

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The Development of a Creative Cluster in the North Region of Portugal (4)

Value-creating ecologies

Consumers to co creators of value Value chains to value networks Product value to network value Simple co-operation or competition to complex co-

opetition Individual firm strategy to strategy in relation to

value ecologies Hearn, G. and C. Pace, Value-creating ecologies: understanding next generation business

systems. foresight, 2006. 8(1). Hearn, G., Roodhouse, S. and Blakey, J. (2007), From value chain to value creating

ecology, International Journal of Cultural Policy, 13, 4, pp. 419-436.

Incubators: part of complex ecology

High risk, high uncertainty, indeterminate outcomes

polyphonic stakeholder expectations Conflicting values Conflicting narratives

(Hannon and Chaplin 2003; Patton et al, 2009; Warren et al, 2009; Warren et al, 2010)

Role of incubator director in co-production of knowledge in the local community or ecosystem (Rice, 2002)

Case studies (pilot – 2 x PINC firms) Exploratory interview/observation methodology – see paper The difficulty of implementing regional strategies (high dependence on

centralized policies) The need to work the dynamics between demand and supply for creative

products and services; The need to coordinate the Creative Sector with other economic sectors; The need to narrow the gap between internal (Portuguese) and global market

(language, copyright and distribution problems); The need to develop an investment culture in the Creative Sector (venture

capital, business angels, public funding, etc) All the above are tangible elements typical of an emergent economic sector; less

tangible elements pertain to the creation and reinforcement of symbolic value, the societal context in which such change might take place:

Incomplete, or partial definitions of Creative Industries, in the local/national context (clearer distinction between cultural and creative activities);

Weakness of creative disciplines in education; Relationships between and articulation of existing events and activities not well

understood (atomized initiatives end up “cannibalizing” each other);

Complexity theory Emergence

Acts of creativity create emergent properties, some of which become significant and structural, though many are ephemeral...

…Thus is societal structure changed

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

‘Emergents’ from Entrepreneurship

… the emergent (ontological) features of entrepreneurial processes are ephemeral and unstable; they exist for now and as such have causal power within their domain

The stabilising power of such emergents is anticipation ; in entrepreneurial contexts specifically; anticipation of value

More generally then, the anticipation of value is a significant aspect of social structure

Emergence

Entrepreneurial relational processes

Emergents with causal properties

Anticipation of value

Fuller, T. and Warren, L (2008) Sustaining entrepreneurial business; a complexity perspective on processes that produce emergent practice, International Entrepreneurship and Management Journal, Vol 4/1, pp1-17 Fuller, T. and Warren, L., Thelwall, S., Alamdar, F. and D. Rae (2010), Rethinking Business Models As Value Creating Systems, Leonardo Transactions , VOLUME 43, ISSUE 1, 2010Warren, L. and Fuller, T. (2010), Capturing The Dynamics Of Co-Production And Collaboration In The Digital Economy, Leonardo Transactions , VOLUME 43, ISSUE 2, 2010Warren, L. and Fuller, T., (2009) Contrasting approaches to preparedness: A reflection on two case studies International Journal of Enterprise Information Systems 5/3, 60-71

how to capture that value???

In moving from value creation to 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 or regularity of practice.

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

Fuller, T., L. Warren, S. Thelwall, F. Alamdar and D. Rae (2010). "Rethinking business models and value creating systems." Leonardo; Journal of the international Society for the Art, Sciences and Technology 43(1): 2.

Ongoing research questions:

Connecting the business with the surrounding industry (local/regional/national/international): how are emergent products identified, articulated, refined and shaped in relation to industry perspectives

The identification, construction, selection and rejection of business models (in light of industry positions and funding structures: how are emergent business models and value propositions identified, articulated, refined and shaped in relation to industry perspectives

The identification, evaluation and selection of business and management training and development tools for organisational development and industry interaction: how do incubators relate to Business Schools and their methods, cultural shifts, knowledge transfer processes.