I-Open Innovation Zone Report

Accelerating Innovation and Entrepreneurship in Northeast Ohio

April 2006

The Institute for Open Economic Networks (I-Open)

4415 Euclid Avenue, Suite 310
Cleveland, Ohio 44106
Ph. 216-246-2447
info@i-open.org

PROPERTY OF THE INSTITUTE FOR OPEN ECONOMIC NETWORKS (I-OPEN)

 Introduction to I-Open Innovation Zones

The Institute for Open Economic Networks (I-Open) is building Innovation Zones in North-
east Ohio to accelerate entrepreneurial partnerships and collaborations between libraries,
universities and local businesses. I-Open has developed a process to cultivate business
leadership and sustain innovation and entrepreneurial activity. Innovation Zones integrate
business, research, educational and cultural assets that our region has to offer to fuel crea-
tivity and innovation.

I-Open Innovation Zones are small zones to encourage density and achieve critical mass
faster by creating an entrepreneurial culture. Innovation zones provide access to business
and opportunities for applied research, case studies and internships and offer colleges and
universities a high number of diverse partnership opportunities to connect to business.

The I-Open Innovation Framework acts as a guide for investment activity in an innovation
zone. With the aid of new measurement tools such as social network mapping, I-Open Stra-
tegic Activities allow us 1) to visualize the size and location of social and financial capital,
2) to understand the relationship between sectors of investment, and 3) to measure in-
vestments over time.

I-Open Civic Forums are the first step in building innovation zones. Weekly forums educate
future leaders in Open Source Economic Development and provide a platform for entrepre-
neurs to practice new behaviors and work together. Simple rules of behavior create a safe
neutral place to exchange ideas and build networks. Topics align with the Innovation
Framework, introduce global models and communicate topic relationships to economic
development and prosperity.

I-Open Civic Forums quickly move ideas to action by promptly identifying next steps. Peo-
ple move in the direction of their conversations and, over time, open systems of networked
activity coalesce around transformative initiatives. Collaborating individuals and organiza-
tions lead innovation supported by an availability of quality, connected workspace, mean-
ingful relationships, and acumen.

Individuals and organization need to behave toward one another in ways that build trust
and respect. Ethical behavior and compassionate leadership build the quality relationships
needed to accelerate idea exchange and begin to seed unprecedented exponential growth of
innovation and entrepreneurship.

The I-Open Innovation Zone Model

Objectives

• Rebuild a deep, sustained commitment to entrepreneurship and innovation

• Utilize the region’s unique assets, especially knowledge-based assets such as our col-
leges, universities and libraries in new and different ways, creating unique value propo-
sitions that will attract and retain businesses that create high-paying, new economy
jobs.

• Instill a spirit of lifetime learning in our children, and create a deep regional commit-
ment to flexible, continuous learning.
2
• Learn and practice new habits of collaboration among government, non-profit,
philanthropic, educational and business organizations.

Strategic Activities and Benchmarks

• Research
I-Open is developing a research and laboratory network across Northeast Ohio to
promote collaboration and accelerate innovation and entrepreneurial activity.
Benchmark: number and quality of researchers committed to the networks.

• Networks (See attached social maps January 11 and March 22, 2006)
Develop and nurture open collaborative networks to accelerate
economic development in regions
Benchmark: number of networks supported by the Innovation Zone
infrastructure.

• Entrepreneurial Initiatives (See list below)

Generate transformational initiatives to leverage new ideas, innovation
and business development
Benchmark: track each new initiative and its relationship to the Innovation
Framework demonstrating location of investment in each quadrant.

• Development of Online Education Opportunities

Position Myers University as a leader in distributing I-Open process and tools for open
economic development distance learning applications and desktop training products
for academic, industry and government leaders and students nationally.
Benchmark: Number and quality of innovative educational programs and participants

Criteria

• Provide safe neutral environments

 Safe, neutral environments encourage leaders to build trust and collaboration.

• Engage cross-disciplinary activity

Open economic network development is an integration of the humanities, the social sci-
ences and business development. Innovation systems require new skills in network
weaving, open economic strategy design, business value building and appreciative
leadership.

• Produce a high volume of activity

Open networked systems produce a high volume of activity at any given time
increasing the likelihood of social connectivity and emerging innovation.

• Create open networked hubs

Engage grassroots, grass tops and senior level leadership in strategic activities.

• Build capacity networks

Capacity networks provide the infrastructure to connect resources and
support services for ongoing group activity. These networks help entrepreneurs
to gain access to lab facility and equipment, funding, social connectivity, and
access to information.
3
 MidTown Innovation Zone Report
First Quarter, January to March 2006

Accelerating Innovation and Entrepreneurship Along the Euclid Corridor

The Midtown Innovation Zone

Midtown Innovation Zone activity began in January 2006 in partnership with Myers Univer-
sity and the City of Cleveland. Since that time open weekly forums created early stage net-
work development and provided the opportunity to learn new practices and tools for
economic development. Forums are modeled after the seventeen month pilot process de-
veloped at the Case Center for Regional Economic Issues (REI) 2003 through 2005 demon-
strating unprecedented exponential growth in innovation and entrepreneurship.

Midtown forum topic development has focused on the economic value of citizen journal-
ism; infrastructure innovations for regional sustainability; building quality, connected
places for the NEO African American community; creating an informatics culture; strategic
networking and social network mapping.

Marketing & communications consist of weekly or daily posting to Midtown Wednesday

Blog http://www.midtownwednesdays.blogspot.com; the Djembe Project Blog
http://www.djembeproject.blogspot.com; posting to regional event calendars; weekly email
announcements and press releases to the I-Open opt-in and media mailing lists.

Over 400 people have participated in twelve weeks of forums hosting speakers in the fol-
lowing areas: government (2), business (9), civic (7), and academia (2). The Midtown opt-in
email list has generated 18,828 media impressions.

Weekly social network maps measure the growth of open economic networks and identify
people who are connected to each other by idea exchange and resource sharing. (See at-
tached social network maps January 11, 20006 and March 22, 2006)

In the second quarter of development (April to June 2006), working groups are applying
basic concepts of open source economic development practices and new tools to organize,
plan and implement resulting early stage initiatives listed below.

Initiatives offer solutions to gaps in infrastructure building necessary to propel NEO for-
ward as a global leader in innovation and entrepreneurship.

Resulting Midtown entrepreneurial initiatives

• NEO University Innovation Café is a co-operative effort of students and alumni from
regional universities and colleges. The Café will provide a place for students to work
together on innovative projects and initiatives. Centrally located in Midtown, it will of-
fer innovative workspace, public WiFi access, meeting rooms and healthy food.

• The Djembe Project is a community initiative to strengthen historical African American

cultural organizations in Cleveland and spearhead new projects through the strengthen-
ing and mapping of social networks. The Center will leverage social networks to accel-
erate innovation and entrepreneurship in NEO.
4
• Film and Movie Incubator Independent film company is seeking support to build a film
and movie incubator; create a new regional workforce; and produce digital film prod-
ucts.

• Global Literacy Networks Building global literacy networks around the world to pro-
vide for third world children and the opportunity for schools overseas to receive books
from the United States.

• GIS Initiative To identify, build and strengthen social networks between regional lead-
ership investing in GIS capabilities and training; standardize measurements; devise
storage and process solutions; identify global models and best practices for regional
applications.

• GreenCityBlueLake http://www.gcbl.org Develop the economic development strategy;

leverage an OSED process to achieve a higher level of social engagement to strengthen
best practices and the quality of innovational content posted to the community site.

• Business Innovation Network Develop industry applications of open source tools and
practices to inform business leaders the value of collaboration within a corporate en-
tity.

• Ohio Conference on International Entrepreneurship Fall 2006, hosted in partnership

with Cleveland State University will network Associate Deans from Ohio colleges and
universities to discuss and learn how to work together to strengthen business schools
and faculty curriculum. By working together, academic leadership can leverage region
resources and discover collaborative opportunities to compete globally.

• Research and Lab Network connects academic leaders who adopt I-Open curriculum,
support student internships and conduct innovative research. Lab networks connect
researchers, innovations, facility and equipment for bioscience, creative digital media,
film, technology, etc. These networks will provide infrastructure for innovation zones
in other areas of the region such the University Circle zone targeting innovations at the
intersections of science and technology.

• Student Internship Opportunities I-Open is working with regional colleges and univer-
sities to develop internship opportunities. Cleveland State University recently hosted an
I-Open Research Symposium for CSU faculty and PhD students.

• Video Game Competition Develop a plan to teach youth how to build video games, web
sites and to host the Midtown Gaming Competition. There is an active network of indi-
viduals interested in developing a gaming competition.

The I-Open Innovation Zone Network Today

I-Open is building a regional network of Innovation Zones across Northeast Ohio connect-
ing research, resources and capabilities to strengthen innovation and entrepreneurship. A
portfolio of transformative initiatives will be developed for each zone. Universities and Col-
leges located in these zones and will benefit from regional collaborations to build trust ac-
celerating new business opportunities, student internships and best practices.
5
Midtown Innovation Zone
The Midtown Innovation Zone is a model for Northeast Ohio.
Contributors: Myers University and the Myers University Library, Cleveland State Univer-
sity, The City of Cleveland
Status: 1 Qtr. mature

In Development:
The Berea Innovation Zone
Contributors: Baldwin Wallace College Center for Innovation and Growth, the City of Berea,
the Berea City School District, the Berea Chamber of Commerce, the Berea Public Library.
Status: Ready to begin

Innovate! on the Circle

Contributors: The Cleveland Museum of Natural History, FUTURE @ The Cleveland Institute
of Art, Cleveland Veterans Affairs Medical Center (VAMC), Systems Technology Affiliates
(STA) and EcoCity: GreenCityBlueLake, engineering and research.
Objective: to explore the intersections between the natural sciences and technology for the
creation of new entrepreneurial ventures.
Status: Ready to begin

Voices in the Valley

Contributors: Youngstown State University and the Warren Youngstown Chamber of Com-
merce.
Status: Ready to begin

Kent State University and Kent, Ohio

Contributors: the Kent State University Department of Economic Development, Kent State
University Business School, and the City of Kent.
Status: Ready to begin

Fairview Park Library and the Fairview Business Leadership

Contributors: the Fairveiw Park Library, proposed Chamber of Commerce, local schools and
municipal government.
Status: Ready to begin

Hiram College and Hiram Village and Township Collaboration

Status: Ready to begin

Our Opportunity: The Center for Regional Economic Initiatives (REI)

Like the Case REI model, the Midtown Innovation Zone has proven that by leveraging a
process of weekly forums, and sharing I-Open practices and tools to support open source
economic development, open innovation and entrepreneurship results in a very short pe-
riod of time.

The Midtown Innovation Zone has yielded eleven possible initiatives in twelve weeks of ac-
tivity. With the proposed additional six Innovation Zones to begin within the next few
months, NEO has an opportunity to engage in an extraordinary number of entrepreneurial
activities regenerating our region and the country.
6
It is critical that Northeast Ohio support the creation of a center, the Center for Regional
Economic Initiatives (REI), to coordinate research, guide leadership, publish issue briefs
and policy recommendations. REI will connect resulting innovation and entrepreneurship to
research located in our regional colleges, universities and libraries.

In addition, expansive new knowledge databases facilitated by advances in technology

software, speed, capacity and lower costs, must be constructed to support non-political de-
cision making affecting our limited natural resources. I-Open entrepreneurs are already
proposing web based platforms to support global standards for energy, water and modern
models for education.

The Center for Regional Economic Initiatives is the missing link between research, innova-
tion and entrepreneurship and will provide an invaluable connection to future sustainabil-
ity.

Next Steps

Phase One
• Planning Grant
Model Design
Process

• Engage a group of diverse stakeholders

(Our model: CuyahogaNext and the Indiana Humanities and Business Leadership
process)

• Outcomes
Determine scope of REI responsibilities
Identify five transformative initiatives

Phase Two
• Determine who will lead REI
• Determine funding and resources

I-Open Team

Ed Morrison, Executive Director

Email: edmorrison@i-open.org

Ed Morrison is co-founder of I-Open based in Northeast Ohio. Until recently, he was

Executive Director of the Center for Regional Economic Issues (REI) at the Weather-
head School of Management, Case Western Reserve University. He holds a BA degree
from Yale University and MBA and JD degrees from the University of Virginia.
For over nineteen years, he has been conducting strategy projects with economic
developers in the U.S. His work won the first Arthur D. Little Award for excellence in
economic development presented by the American Economic Development Council.
Ed is the architect of the strategic economic development plan for Oklahoma City,
and he served as economic development consultant to the Chamber from 1994 to
2002.! ! ! ! ! ! ! ! ! ! ! ! !
! ! ! ! ! ! ! ! ! ! ! ! ! ! 7
Betsey Merkel, Director / Network Development & Programs
Email: betseymerkel@i-open.org

Betsey, co-founder of I-Open, the Institute for Open Economic Networks, brings
twenty years of business development experience, designing community residencies
and ongoing project management in the non-profit sector. Areas of focus include the
creative industries, land conservation and water management, the performing arts
industry, and architectural restoration.

Working with Ed Morrison and the I-Open Team, her approach to network design has
created I-Open Civic Forums, catalyzing many diverse projects, proposals and busi-
nesses. She designs process to support community engagement and entrepreneurial
innovation initiatives. Betsey co-authored "Artist to Artist", a business development
seminar supported by the State of Ohio Office of the Governor and the Ohio Arts
Council. Betsey earned a Master of Music from the Cleveland Institute of Music and
Case Western Reserve University.

Susan Altshuler, Director/Finance & Grants Administration

Email: susanaltshuler@i-open.org

Susan, co-founder of I-Open, the Institute for Open Economic Networks has over 25
years of office and financial management in both the corporate and nonprofit envi-
ronments. For the past eight years, Susan worked as Special Assistant under Richard
Shatten, Director of REI at Case Western Reserve University from 1998 to 2002, and
then under Ed Morrison, Director of REI from 2003 to 2005. Under her management,
Susan worked on special projects, programs, and events; led fundraising efforts
with the Director to ensure long-term funding by developing funding proposals,
identifying significant prospects and managing flow of relationships with donors;
coordinated day-to-day activities for REI professional staff; supervised Department
staff and student researchers; responsible for grants and contract administration;
assisted Director in the hiring and evaluation of staff and researchers.

Dennis Coughlin, Director / Administration & Operations

Email: denniscoughlin@i-open.org

Dennis, co-founder of I-Open, the Institute for Open Economic Networks, has signifi-
cant experience in operations management with non-profit organizations creating
budget proposals, managing staff, developing programs, and analyzing systems. In
his positions, he was accountable for all financial operations, including preparing
budgets, approving purchases, general accounting, preparation, analyzing and pre-
senting financial statements. He previously worked as a consultant at REI under Ed’s
stewardship.

8
 Attachment
I-Open Supplemental Materials

The I-Open Model

The I-Open model builds a sustainable process and practical tools for business, civic, gov-
ernment and academic leaders to identify transformative initiative(s) and design next ac-
tion steps toward 30, 60 and 90-day goals. This replicable process encourages participants
to think entrepreneurially and creates cultures capable of identifying business innovations
quickly to move forward faster with exceptional business opportunities and exponential
growth.

I-Open builds open economic networks to engage leaders, to build trust and to model col-
laborative behaviors enabling working groups to identify transformative initiatives, moving
ideas to action. Engagement begins on a grassroots level and progresses out to include all
leadership.

One Northeast Ohio pilot program, Tuesdays@REI, developed a civic forum process at the
Case Center for Regional Economic Issues (REI) between 2003 and 2005. We engaged over
3,000 participants over a seventeen-month period, generating 83,000 media impressions
and producing a multitude of initiatives, proposals and new businesses. Over 200 hours of
video content of expert presentation was produced from each public program and posted
on the Internet for public access.

This pilot continued to contribute to a larger leadership process, evolving over nine
months into the 2006 Cuyahoga County Commissioner’s Blue Ribbon Task Force. The BRTF
embraced over 200 ideas from leaders resulting in five transformative initiatives adopted
and funded by Cuyahoga County. A copy of the report can be downloaded off of the County
website. Link: http://www.cuyahogacounty.us/bocc/blueribbon.htm

History

“The open source economic development model suggests that in an innovation economy
regions will be transformed by open networks of collaboration with colleges, universities,
schools and libraries as hubs in these networks.” – Ed Morrison

This approach to knowledge sharing was also practiced by Richard Shatten, late Director of
the Center for Regional Economic Issues (REI) at Case Western Reserve University. Shatten
had a keen understanding of the business community and the ability to help others bridge
the gap between research and practice. He was the guiding hand behind public private
partnerships that reinvigorated Cleveland in the 1980’s and 1990’s. Richard taught that
meaningful civic activism must ultimately rest on serious economic analysis of the issues.
He moved easily from thoughts and ideas to creative action, never loosing sight of the need
to build effect networks among people to get things done.

Richard’s efforts to bring divergent parties together in meaningful and mutually beneficial
relationships are what his colleagues remember best about him.

Shatten’s successor, Ed Morrison, continued to build on this legacy until the close of REI in
July 2005, by helping people to understand where they fit in to economic development and
the importance of social behaviors as fundamental to the success of open source econom-
ics, a new approach to economic development.

In Morrison’s twenty-five years as an economic development professional, he has served

regions across the nation demonstrating a gifted ability to bridge the gaps between com-
munity and leadership and by strategizing practical solutions to tough community prob-
lems. Morrison’s innovative approaches to economic development are continuously shaped
by advanced theoretical and practitioner research and characterized by a new level of
Internet interaction.

Today’s Updates on Research and Practitioner Work

There is significant literature available on social network analysis and innovation. Here is
some of the most current news and updates:

Valdis Krebs, New York Times, Magazine, 3-12-06, “Can Network Theory Thwart Terrorists?”
http://www.nytimes.com/2006/03/12/magazine/312wwln_essay.html?ex=1142830800&en
=1fe03acd5b49e523&ei=5070&emc=eta1

Valdis Krebs, social network analysis, Business Week article on IBM organizational structure
and network mapping, 2-17-06:
http://www.businessweek.com/innovate/content/feb2006/id20060216_633293.htm

June Holley at ACE-NET has been working closely with Valdis and applying these tools for
several years with good success and anecdotes. June has been involved with I-Open since
the beginning. See http://www.acenetworks.org/frames/framesabout.htm

June and Valdis presented a lecture to the business school at UCLA and USC last month.

On Tuesday afternoon, 2-28-06, Valdis and Ed Morrison will be giving a presentation to a

research seminar at the Cleveland State University Business School.

At the core of the I-Open approach is the development of open networks of innovation –
sometimes called clusters. There is a wealth of information about clusters and networks.
This is the core approach of the Council on Competitiveness in Washington. See
http://www.compete.org/

This is the core of the Council's regional innovation initiative:

http://www.compete.org/nri/

It is also the core of Michael Porter's work. See his book: On Competition. Boston: Harvard
Business School Press, 1998. See also, the Institute for Strategy and Competitiveness at
Harvard University. See: http://www.isc.hbs.edu/econ-clusters.htm

It is also the basis for the Initiative for a Competitive Inner City: http://www.icic.org

You can look to the National Governors Association, as well:

http://preview.nga.org/portal/site/nga/menuitem.9123e83a1f6786440ddcbeeb501010a0/?
vgnextoid=85e0303cb0b32010VgnVCM1000001a01010aRCRD

Cluster based development is strongly supported in the UK:

http://www.dti.gov.uk/clusters/ecotec-report/
As for proof that it works, look to Silicon Valley, as documented in Regional Advantage, a
book by Anna Lee Saxenian. Her seminal work: Regional Advantage: Culture and Competi-
tion in Silicon Valley and Route 128 (Harvard University Press, 1994).

People of international stature working on this approach right here in Cleveland:

Valdis Krebs is a consultant in social network analysis.

Valdis Krebs: valdis@orgnet.com

David Morganthaler, a venture capitalist, is very strongly supportive of cluster-based

development.
David Morganthaler: dmorgenthaler@morgenthaler.com
Both of these following people have a lot of experience and have thought deeply about
these matters.

Pete Rea at the Baldwin Wallace Business School. BW has chosen to help incubate I-Open.
Peter Rea: prea@bw.edu

Ed Morrison has also been working with the new Center for Regional Development at Pur-
due. Please communicate about Ed’s work with the Director of the Center, Sam Cordes.
Sam M. Cordes smcordes@purdue.edu

Ed Morrison developed this approach over the past seven years working in the field. Please
communicate with JR Wilhite, the Commissioner for Community Development in Kentucky's
Cabinet for Economic Development.
J.R. Wilhite JR.Wilhite@ky.gov

For success stories about this approach working in Cleveland, explore the case of Herb
Crowther and Midwest BioFuels. He went from an idea to pumping biodiesel in five months.
Herb Crowther hcrowther@capling.com

Norm Roulet and Peter Holmes, of Real NEO http://realneo.us who are looking at this issue
from the community computing side. What types of infrastructure do we need to support
dozens of clusters?
Norm Roulet norm@realinks.us
Peter Holmes pholmes@realinks.us

The open question is how can we create, nurture, sustain (choose your verb) new clusters
in Cleveland and the County? That's what I-Open is focusing on.