Lars Frederiksen’s work falls into several major streams, with one of the major themes as “open innovation.”   The idea of open innovation is that companies can do well by drawing on ideas that are in widely available, and by contributing to pools of knowledge that can be used by other entities.  Anita began by asking Lars about the paradoxes in this idea.

Lars reflected on the 25 year since the publication of Henry Chesbrough’s early work on Open Innovation, which of course deals with the problems of how we get knowledge in as well as how we push knowledge out of organizations.

Lars’s work has focused on how firms become good at doing this.  He has looked at how firms access outside sources, and how online communities merge and work. Lars’s work with Lars Bo Jeppesen, a professor at Copenhagen Business School, included the development in 2002 of a webscraper.   This was a new tool for doing research, but at the time, the researchers never asked for permission from the owners of websites that they scraped.  The norms and regulations simply hadn’t developed to require this.   This is paradigmatic of the problem of figuring out how to regulate and control the adoption of new tools.

Lars’s work from the 2006-2012 period dealt particularly about how norms and governance emerge in online communities.   Lots depends on differences across community members in goals, and in skills, and in interests.   Moderating a diverse online community requires capabilities that many organizations didn’t have.  Some even ended up abandoning communities that became so unwieldy – so large – that they were too difficult to moderate.

Lars described how he is now doing a case on LegoPage, which is a 2.2m member community of people presenting their ideas for how to use Legos.  Here’s the struggle for the company in moderating this competition:   Through the rounds of competition, toward the end, the company has to pick winners from among lego-building ideas that tens of thousands of community members may have voted for in the past.  How can it do that without disappointing both the innovators and those who had supported it?

Lars is finding that the community tends to turn its groundswell of discontent toward questions about procedural justice.  In other words, complaints about the company become transformed into complaints about the rules of the competition.  Modifications are made, and then things return to normal.   This is the pattern.

The idea of “open innovation” squares off in your recent research with questions about conflicts, which you describe has having a long tail.  What are your findings in this area?  What kinds of conflicts have the longest tails?

The “long tail of conflict” article emerged from Lars’s work with a doctoral student.  All innovation projects have conflicts.  If you want to innovate, inherently you are seeking to replace something, and you are trying to get people to change.   People don’t always like that.   If you want to innovate, you have to be expert at dealing with this challenge.   Vivian He and Phanish Puranam have a new paper on resolving online conflicts that frames this as a challenge of organization design.

Lars’s work in this area shows how the barriers to tech adoption are often classical problems of organization and economies.   For example, his work now on the choices that farmers make about updating their technologies depend on the resolution of their fears about achieving a return on investing in it; and on whether they are choosing the right tech.

              In the end, tech is a tool.  

One of the most challenging questions emerging in the current international-trade environment is about where breakthrough technologies come from, and on how these can support economic prosperity.  Do you see AI as one of these technologies?

AI implementations right now are mostly about using LLMs internally in organizations.  What’s most interesting to Lars is how AI and LLMs enable collaboration between firms.  Can it enable us to be more open to each other?  In principle, yes.  Can we do it?

Lars turned to the CASP competition and protein folding.   This shows how much depth we can achieve with AI as a tool.  But what about breadth?   Maybe AI can be an enabling technology that can link insights across fields rather than only deepen understandings.   Anita reflected on Gabriel Cavalli’s important work in this domain.

Lars was also concerned about regulation and ethical matters.   DDT was welcomed in India, for example, before we knew the damage it could cause.   We invented the wreck of the Titanic when we invented the Titanic.   We have too little knowledge about how to regulate.  And this is compounded as a concern in Europe as scientists worry about the origins of AI in only US companies such as OpenAI, Facebook, Google, etc.

Do you see the locus of innovation based on scientific discovery changing?  Are you worried about investments in science?

Lars described the problem of how really important issues of sustainability, climate change, biodiversity loss, and environmental degradation are becoming overshadowed by AI, space, and tech.   AI is a tool like a hammer.   But it is such a powerful tool that it is swamping us.   We need to manage the use of the tool as we managed other tools like CRISPR, MRNA, etc.

What does Lars want us to think about?

We need to be focusing on climate change, energy transitions, and biodiversity.  Its time to “get on your bike” and focus on solutions.  This is imperative.   We have tools.  We have opportunity.  Yet environmental degradation is upon us.  It is fascinating and terrified but also motivating.   Let’s have purpose and innovate to save ourselves.