Modern Success Factors of the Innovation Support System

This article is sharing experience of Finland, one of the most innovative country internationally. It includes key conclusions about innovation support system and innovation support infrastructure.

During last decades Finland has been always referred as one of the most innovative country in the world. Does it mean that Finland has one of the best innovation support models and what are its key elements, or, as often asked by visitors to Finland, what are key successful elements of the innovation support system? As experience teaches, it is hard to reach top ranks, but it is even harder to stay among leaders. The question about the key elements of the innovation support is hard to answer, what time snap of the model to use, from 10 years back, present or future?

Probably the key success attribute of the Finnish innovation support system is it flexibility, ability to develop, depending on the changes in innovation nature, international competition and fore sighting of what sectors bring economic growth in the future. The process of developing existing innovation support system is based on transparent strategy planning process, involving key stakeholders, both on national and local level.

What were the key changes influencing innovation support systems in the last years?

First of all, the understanding of innovation itself has changed. Earlier innovation was seen as introduction of new technologies in industrial upgrading, while nowadays understanding of innovation is much wider, basically innovation is defined as something new, renewed. The innovation is a competitive advantage that can be utilized commercially or in society. The new nature of innovation is well described in the report “The new nature of innovation” funded jointly by the Danish and Finnish governments, as a contribution to the ongoing OECD innovation strategy work in 2009. The authors acknowledge that from a macro perspective, new technology has historically been the dominating driver of innovation and a very important reason for an increased standard of living.

In terms of innovations commercialization and creation of new companies the traditional approach to innovations support, where innovations come from the universities and research, is still dominating. Although, according to the European Union statistics, only a few successfully commercialized innovations come from the academic industry and the biggest majority is generated from business and end users. Therefore in the future, companies need to become more open, learn from their customers and collaborate with others. Therefore in the process of commercialization support, networking platforms, such as clusters and mediators, such as technology parks gain a new role.

Therefore commercialization should not be only about technological development, on a contrary it is more and more about business development based on market-driven innovations. Those can be new business models, value-chains, know-how, all what helps business to grow and prosper.

Secondly, according to the European Union, the economic importance of the services sector has grown significantly over the last decade. Almost all employment growth between 1995 and 2007 occurred thanks to the services sector. In 2007, more than 155 million persons were employed in services, accounting for 69% of total employment and generating 71.6% of gross value added in the 27 European Union countries. Consequently, the European economy is a "service economy", and innovative development of the European service sector is important for the future of job creation, economic growth and competitiveness. However, despite the increasing number of studies in the field of service innovation, EU admits that the knowledge about services is still too fragmented, especially low awareness of the types of structures and initiatives contributing to the development of innovation in services.

Finland was one of the first countries to recognize important of supporting non-technological innovations and innovations in non-technological sectors. There are a number of dedicated programs for service companies, as for example Serve, coordinated by the Finnish Funding Agency for Technology and Innovations, Tekes (http://www.tekes.fi/programmes/serve). And in 2009, 50% of state innovation support financing, distributed through Tekes, was targeted at service sectors.

Thirdly, international competition and globalization has been a main driver of implementing innovation support policies. And national and regional benchmarking of innovation support systems to other countries is important source of information and ideas for improvements, whether talking about national level innovation policy, clustering initiative or specific technology park.

Therefore in order to create a working innovation support process, regular analyzing, fore sighting and international benchmarking of innovation system is needed. Considering that innovation system is a localized network of actors and institutions in the public and private sector, whose activities and interactions generate, import, modify and diffuse new ideas and technologies. For this reason, the methodology of analysis of innovation potential should not aim at the detailed examination of each organization, but rather level of their interaction, identifying possible synergy areas, developing forms and mechanisms of collaboration. It includes evaluation of the competitiveness level of higher education, input to research, public services support to innovations, structure of high-tech companies, legislation, funding tools for companies’ growth, as well as measuring the interconnections between all parts of the innovation environment and infrastructure, including interaction between the stakeholders involved.

Are the stakeholders ready for a change? What is their commitment level? Do they have a holistic picture what is happening in their own sector and other sectors? Do we really know how things are solved in the other regions or countries? Is the decision making based on the real facts or rather attitudes and existing culture? How many regular discussions are organized with other stakeholders? Do we have platforms for discussions and interaction? Do we have methods for analyses? What are the mechanisms to identify the most ambitious people and how to build the most dynamic networks for innovations? What means in practice knowledge market? The last, but not least, who is taking the leading role in developing innovation-friendly environment and is also ready to take the responsibility in case of failure?

Thus in Finland, the coordinating role in innovation system development is given to the National research and innovation council, headed by Prime Minister and regularly updating innovation policy. Leading role in innovation strategy development belongs to the Ministry of Employment and the Economy. The national innovation system is regularly assessed and benchmarked on international level. Latest evaluation can be found from www.evaluation.fi.

Also, as counties and municipalities have a strong decision making power in Finland, some of them create their own strategy planning instruments for developing regional innovation systems based on joint vision process.

The common challenge in most of the countries, when developing innovation or commercialization support system, clustering program or technology park, is that the stakeholders do not have a joint vision for the future steps. The stakeholders need to see a joint vision as a strategic development instrument for the region in competitiveness. It can be created up to the next 5 years or even 10 years, but it must be updated continuously.
Joint vision process or council helps to avoid mistakes and gives guidelines whether the matter is about establishing a technology park, identifying local driving sectors, finding synergies between clusters or agreeing on definition of “innovations” that will be used to provide public support.

This article is also published on the website of the Office of Enterprise Development and Innovation of the the Pomeranian Region Marshal's Office: http://www.innopomorze.pl/innovation-support-system.html