Paul Davidsson
, Anders Hederstierna
, Andreas Jacobsson
and Jan A. Persson
Bengt Carlsson
, Stefan J. Johansson
, Anders Nilsson
, Gunnar Ågren
and Stefan Östholm
School of Engineering,
School of Management
Blekinge Institute of Technology, S-372 25 Ronneby, Sweden.
Keywords: Enterprise collaboration, entrepreneurial business, innovation, intelligent agents, interoperability, match-
making, recommendation systems, virtual enterprise.
Several barriers to turn innovative ideas into growth-oriented businesses with a global outlook are identi-
fied. The Plug and Play Business concept is suggested to lower these barriers by making it possible for the
innovator to plug into a network of actors or potential collaborators with automated entrepreneurial func-
tions. A P2P paradigm with intelligent agents is proposed to realize an environment that manages a dynamic
network of roles and business relations. It is suggested that a critical characteristic of the Plug and Play
Business software is to facilitate trust in-between the actors.
The fact that innovations are important to create
both private and social values, including economic
growth and employment is well-known. Innovations
as such are not sufficient for economic growth; there
is also a need to develop the innovation from an idea
into a business. From an innovator’s perspective
there are some common obstacles for realizing the
potential of innovations, such as:
shortage of time to spend on commercialization
lack of business knowledge,
underdeveloped business network, and
limited financial resources.
This implies that the innovator requires support to
develop the idea into business, something often seen
as the specific role of the entrepreneur. As Leiben-
stein (1978) explains, entrepreneurs are needed to
search, discover, evaluate opportunities and marshal
the financial resources necessary, among other
things. In some but not all cases, the innovator and
entrepreneur may be the same person.
To play the role as innovator or entrepreneur in
the networked economy requires in many instances a
global outlook. New trade and production patterns as
well as the emergence of new markets point towards
a more efficient use of global resources. Information
and Communications Technology (ICT) already
plays an important role as a facilitator in this devel-
opment. We believe that better economic growth can
be achieved when the innovation and the entrepre-
neur can compete and solve problems on a global
market place. To enable this, there is a need of a
deep understanding of supply and demand in a
global economy.
In order to support the idea of a business based on
global matching of resources to needs, it is important
to facilitate not only for entrepreneurs but also for
mediating actors, i.e., such with new ideas of match-
ing resources on a global scale. We call them Hi-
Know Enterprises, i.e., post-industrial businesses
based on an advanced understanding of supply and
demand in the global economy including, for exam-
ple, global production and distribution systems.
The vision of Plug and Play Business is to de-
velop an integrated set of ICT-tools, in particular for
innovators and supporting business roles. The tools
should support the creation and management of
business despite limited time, business knowledge,
network, and/or financial resources of the innovator.
The innovations considered are not limited to physi-
cal products, but may concern new services as well
as making or organizing businesses in new ways.
Such innovations will be commercialized in the
Davidsson P., Hederstierna A., Jacobsson A., A. Persson J., Carlsson B., J. Johansson S., Nilsson A., Ågren G. and Östholm S. (2006).
In Proceedings of the Eighth International Conference on Enterprise Information Systems - SAIC, pages 213-217
DOI: 10.5220/0002469102130217
competitive and sometimes hostile networked envi-
ronment of today, engaged in complex business
processes, and requiring new forms for collabora-
tion. Together with the autonomy, heterogeneity,
and possibly conflicting goals of the involved par-
ties, this requires ICT-solutions that are able to han-
dle dynamically evolving and distributed business
partnerships and processes that cross the borders of
various enterprises.
Three important ideas for implementing the concept
of Plug and Play Business are:
Internet communities: Enterprises join a Plug and
Play Business community by installing the Plug
and Play Business software and by describing and
validating the resources of the enterprise, e.g.,
production capacity, distribution network, intel-
lectual capital, etc. The community is dynamic in
the sense that enterprises may (in principle) join
and leave the community at any time. However,
there may be a need for a specific gate-keeper
that regulates the entering and leaving of the
community, thus making it a semi-open artificial
Roles: Each member of the Plug and Play Busi-
ness community plays one or more roles, e.g., in-
novator, supplier/provider (of goods, services,
expertise, etc.), distributor, marketer, financier,
seller, etc. An important role in the life cycle of
businesses is the entrepreneur. There is a variety
of definitions of entrepreneur and we have
adopted the classical idea originating from
Schumpeter where an entrepreneur is someone
who turns an innovative idea into a business by
identifying market opportunities (Schumpeter,
1934; Kirzner, 1982). With that definition, we try
to make a distinction between the role as innova-
tor and entrepreneur. One of the purposes of Plug
and Play Business is to automate as much of the
entrepreneurial role as possible, for instance by
using intelligent agent technology, thus increasing
the probability of turning an innovative idea into
a business.
Crystallization: A member of the Plug and Play
Business community, typically an innovator, may
at any time initiate an attempt to form a collabo-
rative coalition in-between the members. This
process may be viewed analogous to crystalliza-
tion, where a catalyst (innovator) initiates a proc-
ess resulting in a precise form of collaboration,
i.e., the crystal (cf. the formation of a virtual en-
terprise as described below). The main role of the
entrepreneur, which to a large extent is automated
by the Plug and Play Business software, is to
drive this process. It may be a more or less elabo-
rate process starting with just a seed of an innova-
tive idea without any pre-defined business struc-
ture, or it may be a full-fledged business idea with
well-defined needs to be met by potential collabo-
In order to realize this vision, the Plug and Play
Business technology should include tools that can
enable the different community members to use their
resources efficiently in business solutions (crystals).
This requires for example the following functions
related to match-making activities:
Finding: To find candidates suitable for a poten-
tial collaboration is an important function. It pri-
marily concerns finding candidates within the
community, but possibly also candidates currently
outside the community. The finding functionality
may include the possibility both for search, based
on specific needs specified by criteria, e.g., role,
type of products, and business model, as well as
for posting general needs or ideas that other
members may suggest solutions and/or resources
Selection: When a set of potential collaborators
have been found they need to be evaluated. Plug
and Play Business technology should provide the
feature of suggesting actors for collaboration
based on, for example, content-based recommen-
dation (previous interests of actors) and collabo-
rative recommendations (based on preferences of
similar actors). This requires the support for using
track records and potentially support for certifica-
tion schemes of, for instance, the trustworthiness
of the actors. Further, decision support for evalu-
ating trade-offs between a number of characteris-
tics are needed, e.g., trade-offs between cost of
product/service, cost of transportation, and time
to delivery of product/service. Which actors to
choose for the collaboration (i.e., crystallization)
should be based on the evaluation and the esti-
mated value of collaboration with other actors in
a crystal.
Negotiation: When the catalyst has selected actors
for the necessary roles of the crystal, agreements
between the actors with respect to financial and
product/service agreements need to be settled.
The Plug and Play Business technology should
provide support for different types of agree-
ments/contracts including support for intellectual
property rights.
When the crystallization phase is finished, the Plug
and Play Business technology should provide sup-
port also for the collaboration phase, i.e., the man-
agement of the actual business activities. This sup-
port may be on a quite shallow level, e.g., transac-
tions of information between actors. On a deeper
level, the Plug and Play Business technology should
support and facilitate complex coordination and
synchronization of activities. A wide range of in-
formation types needs to be transferred in an effi-
cient way in order to reduce the administrational
costs of the actors as well as reducing the risk of
inaccuracy in information. The management of the
crystal requires support for controlling the flow of
activities between the involved actors. It concerns
activities with potential long-term consequences
(e.g., initiating product development) as well as
regular business activities (e.g., decisions of produc-
tion and distribution).
There is a set of criteria that should consider dif-
ferent aspects of a cost effective system. Some crite-
ria that should be met by the collaboration-
supporting software are, e.g., interoperability (in-
cluding with the relevant legacy information systems
used by the involved parties), scalability, adaptabil-
ity (handling shifting collaborator needs), independ-
ence (avoiding technological lock-in and high entry-
costs), affordability, simplicity and usability, system
dynamicity (maintaining system functionality, e.g.,
when members are entering or leaving), as well as
security (i.e., preventing unintended exposure of
sensitive information) and robustness in terms of the
resilience of the system, especially when under
stress or when confronted with invalid input. We
discriminate between three dimensions of such col-
The level of collaboration: This is related to the
content and purpose of the exchanged information
with tasks ranging from administrative informa-
tion exchange to complex operations planning.
An example of a simple administrative task is or-
dering and invoicing, whereas a more complex
task may concern making critical information
available to the collaborating partners, in order to
improve operations by better and more efficient
planning and scheduling, i.e., resource optimiza-
The number of involved enterprises: The more
parties involved in the collaboration, the more
complex the solutions may be. The simplest case
concerns collaboration between only two enter-
prises (one-to-one collaboration), whereas the
general case involves a large number of enter-
prises collaborating with each other in different
ways (many-to-many collaboration).
The dynamics of the collaboration: In the simple
static case, the actors involved in a specific col-
laboration are known from the start and will not
change. In a truly dynamic collaboration, on the
other hand, actors may join and leave at any time
with short time to build trustful relationships.
In particular, we believe a critical requirement of the
Plug and Play Business technology is to facilitate
trust in-between the actors. The reason is that the
success partly relies on that members are willing to
contribute with information about their own core
business resources which may include, e.g., intellec-
tual property. Trust can be boosted by enhancing
security. Security problems arise in that the difficul-
ties for guaranteeing that information, which may be
sensitive to one party, is not being misused by other
parties in the network. Also, when many companies
are involved in collaboration, access to available
data is difficult to restrict. Some security features
that help to ensure security and trust in partner selec-
tion and collaboration may be, e.g., identification
and authentication of participants, encryption of
data, access control mechanisms, intrusion detection
capabilities, and possibly some trusted third party
involvement. However, security features must be
carefully considered so that they do not interfere
with agility, dynamicity, interoperability, and low
In reaching the potential of Plug and Play Busi-
ness, the use of open source software and freeware
components comes well at hand. This suffices for
agile operations since it among other things presents
enterprises with the option to speed up software, and
to share knowledge of security risks and patches.
This also enables participating companies to develop
proprietary functions of the software, and it is also a
form of cost avoidance or cost sharing.
We believe that a fully decentralized paradigm
such as peer-to-peer (P2P) can be a preferable alter-
native for the Plug and Play Business software,
because no central authority determines how the
participants interact or coordinates them in order to
accomplish some task. A P2P infrastructure self-
configures and nodes can coordinate autonomously
in order to search for resources, find them and inter-
act together. P2P being a paradigm that allows build-
ing dynamic overlay networks, it can be used in
order to realize an environment that manages a dy-
namic network of business relations. Dealing with
business sensitive assets (e.g., innovators’ knowl-
edge), searching and retrieval of contents, as well as
discovery, composition and invocation of new ser-
vices, should be made secure and trustable. The P2P
infrastructure realizes an environment in which
every organization can make its knowledge and
services available to other organizations. In a P2P
infrastructure, each organization can autonomously
manage this task without having to delegate it to an
external central authority.
From a business perspective, the long term result
of Plug and Play Business software will be increased
possibilities for innovators to obtain, e.g.:
transactional value: effectiveness in finding and
managing business relations,
scope value: opportunity to carry out business on
a global basis at a lower cost, and
strategic value: better informed and more adap-
tive to new market options.
From a societal perspective it will increase the pos-
sibilities for economic growth on a global, national
as well as regional level. It may lead to lower barri-
ers to turn innovative ideas into business activities,
especially by less dependence on local concentration
of the different types of resources necessary for
doing business.
In the networked economy with lower transaction
costs, organizations concentrate more and more on
their core business processes and join temporary
business alliances in order to solve market needs,
thereby forming Virtual Enterprises (VE). In a VE, a
company initiates collaboration by assembling a
temporary coalition of partners and services for a
certain purpose (Petrie and Bussler, 2003). Unlike
their traditional counterparts, VEs are flexible, can
be any size or any type and can reconfigure them-
selves quickly and temporarily in response to vary-
ing market demands. One of the main advantages of
VEs is reduced cost as well as time-to-market. Hi-
Know Enterprises may be treated as the initiator or
catalyst of the formation of a VE. The Plug and Play
Business software is intended as a framework for
integrated ICT-support for implementing VEs that
act in a dynamic networked environment, which also
may be hostile due to sharp competition amongst
rival companies (cf. Carlsson and Jacobsson (2005)).
The idea of Plug and Play Business has some resem-
blance to the work described by Chituc and Azevedo
(2005) in that dynamic collaboration processes for
agile VEs are emphasized. However, they do not
provide an integrated framework as they leave out
crucial aspects, such as, the match-making task and
security management.
Regarding match-making activities, the tasks of
finding and selection (e.g., business partners) has
been the object of a lot of research within the area of
recommendation systems (cf. Adomavicius and
Tuzhilin (2005)). Here, the main idea is to automate
the process of “word-of-mouth” by which people
recommend products or services to one another. So
far, recommendation systems have successfully been
deployed primarily in consumer markets. As most
existing recommendation systems are not developed
for B2B applications, they generally exclude the
negotiation process. However, there is a long tradi-
tion in the area of agent-based systems of studying
this topic (cf. Rosenschein and Zlotkin (1994)), for
instance using the contract net protocol and compu-
tational auctions.
As pointed out earlier, the task of multi-lateral
collaboration and information resource sharing must
be adjusted for a dynamically evolving networked
environment marked by strong competition. In our
view, ICT solutions that support multi-lateral col-
laboration should therefore meet the requirements of
interoperability and scalability as well as security
and robustness. There is no approach available that
meets all of these criteria. It seems that Microsoft’s
BizTalk Server is the most sophisticated solution for
collaboration. However, BizTalk only supports one-
to-one party collaboration, and is currently not fit for
information resource sharing (even though it is
claimed that the next version will contain a limited
extent of such capabilities). BizTalk is based upon a
central server through which all exchanged informa-
tion pass, it uses XML and supports the main proto-
cols for email and http. Also, being a centralized
proprietary client-server solution it has several dis-
advantages, such as, making the actors dependent of
a third party, being expensive and having possible
risks for communication bottlenecks. In enabling
Plug and Play Business technology, one promising
alternative for multi-lateral collaboration is the use
of decentralized intelligent agents. In (Davidsson et
al., 2005), a general wrapper agent solution is de-
scribed based on open source freeware that makes it
possible (in principle) for any business system to
exchange information with any other business sys-
tem. In (Carlsson et al., 2005), further improvements
on the wrapper agent technology are suggested by
addressing security issues as well as an extended,
possibly dynamic, set of involved companies and
higher levels of collaboration (i.e., information re-
source sharing).
3.1 What is New in this Research?
We are not aware of any integrated ICT-tool for
implementing VEs. We argue that the Plug and Play
Business technology remedies this situation and has
the ability to realize the potential of VEs. In addi-
tion, we focus on an important role in a VE that has
been largely ignored, namely that of the innovator.
We believe that tools are missing for supporting the
entrepreneurial activities related to the commerciali-
zation of innovations. Below, we make a technologi-
cal assessment of our approach compared to the
current state of the art:
Match-making: We believe that a Plug and Play
Business technology can deploy ideas and solu-
tions from existing recommendation systems (in
particular hybrid approaches based on both col-
laborative filtering and context-based systems) in
order to locate and select new partners, and agent-
based technologies in negotiating terms of col-
laboration. However, since match-making activi-
ties typically are based upon incomplete informa-
tion (for instance because potential partners are
not interested in revealing business opportunities
or publishing their business critical information),
aspects of security and trust must also be incorpo-
rated within the task.
Collaboration: We believe that an agent-based
approach can be used in order to enhance multi-
lateral collaboration in dynamic networked envi-
ronments. However, compared to current state of
the art, the envisioned Plug and Play Business
technology must focus more on cost efficiency,
e.g., by using open source software, meeting cri-
teria such as interoperability and scalability, as
well as providing better support for security and
Future work on Plug and Play Business will be fo-
cused on developing:
detailed requirements specifications of Plug and
Play Business software,
a validated technological model of the Plug and
Play Business software platform,
partial prototypes indicating the viability of the
Plug and Play Business concept,
demonstrators illustrating the Plug and Play Busi-
ness concept.
To further support secure collaboration, (automated)
methods for valuating risks and comprehensive
models for secure information asset management
will be addressed ahead. Finally, we will also study
information infrastructure architectures and business
models supporting the implementation of agile and
secure Plug and Play Business communities.
This work has been funded by the project “Integra-
tion between different SMEs’ business systems”,
financially supported by “Sparbanks-stiftelsen
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