Let’s discuss the boundary conditions to innovate successfully based on some cases in Flanders and the Netherlands. Most governments are taking about half of their gross national product for their account. They can be better off by being open to innovation in the public purchase process and act as a launching customer for their industry and start-ups.

1. 4.3 The government as launching customer: a great opportunity for companies 1
CONFIDENTIALCONFIDENTIAL
THE GOVERNMENT AS A LAUNCHING CUSTOMER:
A GREAT OPPORTUNITY FOR COMPANIES
Rutger Steens
Innovation Consultant
Rutger.steens@verhaert.com
TRACK 4
MyFutureGovernment

2. 4.3 The government as launching customer: a great opportunity for companies 2
CONFIDENTIAL
1969
YEARS
PIONEERING
INNOVATION
20191969

3. 4.3 The government as launching customer: a great opportunity for companies 3
CONFIDENTIAL
20191999
1999
B É T A

4. 4.3 The government as launching customer: a great opportunity for companies 4
CONFIDENTIAL
20191999
1999

5. 4.3 The government as launching customer: a great opportunity for companies 5
CONFIDENTIAL
1999 2019
DIGITAL NETWORK MODELS
Digital
channels
activities
resources

6. 4.3 The government as launching customer: a great opportunity for companies 6
CONFIDENTIAL
1999 2019
SMART CITY CHALLENGES
77%
63%
Imec Smart City Meter 2019
Mobility Livability

7. 4.3 The government as launching customer: a great opportunity for companies 7
CONFIDENTIAL
1999 2019
GovernmentBusiness
“SERVING A CITY”

8. 4.3 The government as launching customer: a great opportunity for companies 8
CONFIDENTIAL
1999 2019
Consumers
“SERVING CONSUMERS”
Business
C

9. 4.3 The government as launching customer: a great opportunity for companies 9
CONFIDENTIAL
1999 2019
EXCITING EXPLOSION OF B2C
Endangering usage
Public nuisance

10. 4.3 The government as launching customer: a great opportunity for companies 10
CONFIDENTIAL
STILL USING ‘SINGULAR’ MODELS
B2B B2C
C2CTransaction / multisided
platforms
B2G
1999 2019

11. 4.3 The government as launching customer: a great opportunity for companies 11
CONFIDENTIAL
NETWORK MODELS REACH FURTHER
1999 2019
B2X

12. 4.3 The government as launching customer: a great opportunity for companies 12
CONFIDENTIAL
NETWORK MODELS REACH FURTHER
1999 2019
B2X

13. 4.3 The government as launching customer: a great opportunity for companies 13
CONFIDENTIAL
NETWORK MODELS REACH FURTHER
1999 2019
B2X2CB2X

14. 4.3 The government as launching customer: a great opportunity for companies 14
CONFIDENTIAL
Discovering a network model
THEY GO BEYOND YOUR CUSTOMER
B2B B2C

15. 4.3 The government as launching customer: a great opportunity for companies 15
CONFIDENTIAL
Discovering a network model
B2B B2C
CREATING AN ADDITIONAL RELATIONSHIP

16. 4.3 The government as launching customer: a great opportunity for companies 16
CONFIDENTIAL
Discovering a network model
B B C2 2
A ‘HIGH END’ MALL AS EXAMPLE
M2

17. 4.3 The government as launching customer: a great opportunity for companies 17
CONFIDENTIAL
Discovering a network model
CONSUMERS HAVE A RELATION WITH THE MALL = B2B2C
M2

18. 4.3 The government as launching customer: a great opportunity for companies 18
CONFIDENTIAL
Discovering a network model
A B2B2C EXAMPLE

19. 4.3 The government as launching customer: a great opportunity for companies 19
CONFIDENTIAL
Discovering a network model
1
st
B2B2C/NETWORK MODELS HAVE B2B CHARACTERISTICS
LAUNCHING
CUSTOMER
Customer
Who is willing to help you
through the last steps and
promote your business

20. 4.3 The government as launching customer: a great opportunity for companies 20
CONFIDENTIAL
The launching customer
2015
THE 1st WHO HELPS YOU SCALE

21. 4.3 The government as launching customer: a great opportunity for companies 21
CONFIDENTIAL
The government as launching customer
B2B B2C
B2C HAS A SIMILAR PURPOSE

22. 4.3 The government as launching customer: a great opportunity for companies 22
CONFIDENTIAL
The government as launching customer
B2G G2C
B2C HAS A SIMILAR PURPOSE
CITIZENS

23. 4.3 The government as launching customer: a great opportunity for companies 23
CONFIDENTIAL
The government as launching customer
A SUCCESFULL CASE FROM THE NETHERLANDS

24. 4.3 The government as launching customer: a great opportunity for companies 24
CONFIDENTIAL
Endangering usagePublic nuisance
The government as launching customer
Achievable? Desirable? Useful? Permissible?Helpful?
FACES A LOT OF ADDITIONAL CHALLENGES
USERS NON-USERS
Bouwen aan morgen, 2019, D.Robberecht, S.Smet

25. 4.3 The government as launching customer: a great opportunity for companies 25
CONFIDENTIAL
The launching customer characteristics
A ‘LEAD USER’
THE “CREATIVE” CUSTOMER
PROMOTES YOUR BUSINESS
REQUIREMENTS FOR SCALE
Lead Users
No commercial
solutions available
# people in need of
a new solution
Early
Adopters
Early Majority Late Majority Laggards
Inflated
expectations
E. Von Hippel 1986

26. 4.3 The government as launching customer: a great opportunity for companies 26
CONFIDENTIAL
Government & launching customer behavior
RESEARCH EARLY STAGE TRANSITION GROWTH STAGE
Research Seed Series A Series B, C, D
Fundamental research Line up evidence De-risk Have machinery for growth
IN A START-UP RUNWAY
A working proposition
Bouwen aan morgen, D.Robberecht, S.Smet
Angular Ventures

27. 4.3 The government as launching customer: a great opportunity for companies 27
CONFIDENTIAL
Government & launching customer behavior
RESEARCH EARLY STAGE TRANSITION GROWTH STAGE
66,2 % 53,0 % 33,7 % 20,1%
Riskof
Failure
Government VC Firms Growth VC Firms
VCs TRY TO REDUCE RISK
Bouwen aan morgen, D.Robberecht, S.Smet
M. Mazzucato, 2018

28. 4.3 The government as launching customer: a great opportunity for companies 28
CONFIDENTIAL
Growth FirmsGovernment VC Firms
Government & launching customer behavior
RESEARCH EARLY STAGE TRANSITION GROWTH STAGE
66,2 % 20,1%
Riskof
Failure
LAUNCHING CUSTOMER
SERIES B
LAUNCHING CUSTOMERS TAKE LOWER RISKS

29. 4.3 The government as launching customer: a great opportunity for companies 29
CONFIDENTIAL
Conditions for a government as launching customer
‘Serving a City’ does not mean selling a product to the government anymore
APPROACH GOV AS YOU WOULD A VC

30. 4.3 The government as launching customer: a great opportunity for companies 30
CONFIDENTIAL
Conditions for a government as launching customer
APPROACH WITH A BUSINESS MODEL
Desirability Network
effects
Usability Scalability Revenue
Sources
In cooperation with A. Rampell

31. 4.3 The government as launching customer: a great opportunity for companies 31
CONFIDENTIAL
Conditions for a government as launching customer
APPROACH A BUSINESS MODEL AS A VC WOULD DO
Entrepreneurship
INNOVATION
I – CAPACITY
E – CAPACITY
Innovation
Bouwen aan morgen, 2019, D.Robberecht, S.Smet

32. 4.3 The government as launching customer: a great opportunity for companies 32
CONFIDENTIAL
Conditions for a government as launching customer
I&E - DIGITAL POLICIES
Integration ease, streamlined access,
insights as a foundation – E-Stonia (EE)
I - REGULATORY PLAYFUL
Balance flexibility and clarity to propel
innovation initiatives –
Financial Conduct Authority (UK)
I - DESIGN THE FOUNDATION
Invest to help citizen / customer centric
research and conceptualization – PIO (BE)
E - REDEFINE REQUIREMENTS
Redefine requirements so procurement focuses on
outcomes and goals instead of history and approach –
Defense Innovation Unit (US)
E - RAPID PROCUREMENT
Facilitate the uptake of new ideas on a
startup inspired timeline – Navy (US)
I - USE OTAs (Other Transaction Authorities)
Go external to fast and flexibly contract or buy
technology to test prototype technology –
Multitude of states (US)
HELP THEM THINK OF YOUR OWN CITIZENS
MIT Innovation Initiative, McKinsey, Verhaert New Products & Services

33. 4.3 The government as launching customer: a great opportunity for companies 33
CONFIDENTIAL
In conclusion
A B2G2C APPROACH TARGETS THE GOVERNMENT AS
A LAUNCHING CUSTOMER

34. 4.3 The government as launching customer: a great opportunity for companies 34
CONFIDENTIAL
In conclusion
ACTIVILY ADDRESSING CHALLENGES IN COMPLEX CITY NETWORKS
BY TAKING A VC INSPIRED APPROACH IN THE GROWTH STAGE
A ‘LEAD USER’
THE “CREATIVE” CUSTOMER
PROMOTES YOUR BUSINESS
REQUIREMENTS FOR SCALE

35. 4.3 The government as launching customer: a great opportunity for companies 35
CONFIDENTIAL
One group, five brands
Our services are marketed through 5 brands each addressing
specific missions in product development.
INTEGRATED PRODUCT DEVELOPMENT
ON-SITE PRODUCT
DEVELOPMENT
DIGITAL PRODUCT
DEVELOPMENT
OPTICAL PRODUCT
DEVELOPMENT

36. 4.3 The government as launching customer: a great opportunity for companies 36
CONFIDENTIAL
THE LAUNCHING CUSTOMER CHARACTERISTICS
A ‘LEAD USER’
THE “CREATIVE” CUSTOMER
PROMOTES YOUR BUSINESS
REQUIREMENTS FOR SCALE
Lead Users
No commercial
solutions available
Plateau of productivity
Peak of inflated
expectations
# people in need of
a new solution
Visibility of
expectations
Early
Adopters
Early Majority Late Majority Laggards