Logo: to the web site of Uppsala University

Digital technology continues to extend the co-creative role of users and user communities as sources of innovation-conducive knowledge. While the potential of user communities in this context is well established, little is known about the capabilities needed to successfully manage the interface with virtual user communities. The paper investigates User Community Sensing (UCS) capability as a measure of firms' ability to anticipate changes and opportunities for innovation by interfacing with relevant user communities. Based on existing research and data from 173 product innovation projects, the study employs structural equation modelling to test the hypothesised effects of this capability on product innovation performance and product innovation speed. The results indicate that UCS capability affects performance positively and indirectly by increasing knowledge about users but has no significant effect on speed. As well as contributing to the literature on innovation management, the study has a number of implications for practitioners.

Digital and open innovation has changed how product innovation occur and how it is managed by firms. Digital technology as an enabler of increasingly distributed innovation processes has in particular impacted firms’ abilities to draw on, and leverage, large numbers of external users and user communities to develop their offerings. In the video game industry, firms have developed and honed capabilities to utilize user communities as sources of information and modular user innovations. Empirical evidence of the performance effects in product innovation as well as conceptualizations of these capabilities is however lacking in extant research. Grounded in a dynamic capability perspective, this dissertation puts forward two capability concepts and tests their effects empirically in the context of the video game industry. First, the concept of a community sensing capability captures the firm’s ability to identify and internalize innovation-conducive information from user communities. This capability entails managing openness in the firm’s innovation processes. Second, the concept of a product openness capability relates to the firm’s ability to create and manage products functioning as platforms for continuous development and coupling of internal and external innovation. This, in turn, involves managing openness in individual products. Using both qualitative and quantitative methods, these capabilities are examined at the project level of analysis in relation to the financial performance of products and the speed of development processes. The findings show the capabilities to be indirectly related to the financial performance of products. The application of community sensing capabilities in development of video games increases the amount of information about user needs, demand and product use possessed by the firm, which in turn positively impacts performance. Designing products open to external innovation by users in turn increases the development speed of products, which positively impact the financial performance of products. The two capabilities are also shown to be interlinked as community sensing has a positive impact on product openness. The dissertation contributes at the intersection of open and digital innovation in addition to previous work on sensing capabilities. The work also holds practical relevance by showing the potential of utilizing user communities for digital product innovation.

A particularity of the video game industry is that oftentimes consumers and user communities are involved and used as a source of innovation for the development process. Digitalization has made it easier for developers to engage with their communities and communication has shifted from a one-way towards a two-way communication between developer and community. This article sets out to investigate whether engagement in online communities by the game developers has an effect on the innovativeness of the final product. Moreover, the article examines the effect of Development Speed on innovativeness.The data for this study was collected through structured survey interviews from 176 Swedish video game development projects. The data is analyzed through structural equation modeling (SEM). The results show that Online Community Engagement and Development Speed have a significant effect on the Innovativeness of a game. The paper highlights that adding a social dimension - by involving online communities in form of a two-way communication in the development process - has a beneficial effect on a game’s innovativeness.