Policy context

1. Introduction

A straightforward and comprehensible way of framing the essence of an innovation system is to view it as a system in which those who generate new knowledge are efficiently connected to those who can benefit from its use. Then, when going into more detail, one can see that these connections are established through a set of instruments, institutional settings and infrastructure that accelerate knowledge flows and enable innovation. Thus, a successful innovation system (regional or national) is characterised by having:

  • Institutions such as universities or research institutes that are linked to each other and to a strong private business sector.
  • Instruments such as public-financing processes designed to elicit the largest possible private sector Research and Development (R&D) investment response, fiscal and financial incentives.
  • Incentives such as a proper intellectual property rights (IPR) regime and strong competition in product and input markets, as well as the proper linkages among these markets.

While the individual actors of an innovation system may not think of themselves as constituents of a ‘system’, viewed from an outside theoretical perspective, this notion proves beneficial. The concept of an innovation system provides a tool for analysing specific regional aspects in the innovation process in a globalised economy, as well as a guide for policy formulation. It highlights interactions and interfaces between various actors and the workings of the system as a whole rather than the performance of its individual components.

The specific characteristics of a region are highly relevant when regional governments develop smart specialisation strategies, trying to identify which high-value added activities offer the best chance of strengthening the region’s competitiveness. Here, the idea of a regional innovation system comes into play, since smart specialisation involves businesses, research centres and universities working together to identify a region’s most promising areas of specialisation but also the weaknesses that hamper innovation.

The European Commission provides some key ideas (10) of what could make up the main elements of such specialisation strategies, elements that also fit well with the innovation system concept. For example, supporting the development of clusters of interacting companies pooling competences and infrastructure can create an environment to foster competitiveness and drive innovation. Ensuring sustained knowledge creation through lifelong learning in research and innovation, instilling an entrepreneurial mind-set in students are vital to developing a region’s innovation capabilities. Linked to this is the necessity of an attractive regional research infrastructure in a knowledge-based innovation system. As for the public sector, its role is not only that of policy-making but also covers direct involvement with the business actors of the innovation system in particular. Through public procurement, the public sector can bear the role as risk taker and act as a lead customer, thereby functioning as a driver for innovation helping innovative firms speed up their entry into the market.

Thus, the concept of a regional innovation system as a way to model the actions and interactions of universities, businesses and public actors is also useful for strategic work, since it provides structure to which strategic elements can be related.

2. The European innovation scene

Over the past decades, the European Commission has developed and implemented a range of programmes and initiatives to support innovation in the Member States and lately to an increasing extent also in the Regions. The European efforts have been framed by strategic policy frameworks. From 2000 to 2010, this framework was called the Lisbon agenda. This policy framework was heavily based on the economic concepts of Innovation as the motor for economic change (based on the writings of Joseph Schumpeter), the ‘learning economy’ as well as social and environmental renewal. Despite the fact that most of the ambitious goals of the Lisbon agenda were not fulfilled, it formed the basis for the present policy framework and framework programmes. Here follows a brief outline of what we believe are the most important initiatives and programmes for the topic of innovation systems at European level.

  • 2.1 Policy and strategy
    • The European Commission’s growth strategy for the period 2010-2020 is called Europe 2020. It aims to deliver more jobs and better quality of life thereby achieving a more sustainable future by concentrating on the long-term effects instead of the short-term ones. The strategy involves offering the European Union a sustainable sense of direction by working towards delivering smart, sustainable and inclusive growth. The aims and direction for Europe can be reached by effectively investing in education, research and development, and climate issues, by moving towards a low-carbon society and by emphasising job creation and poverty reduction. The EU and the Members States have designed seven flagship initiatives to take forward the Europe 2020 strategy.

      The flagship initiative of the European Commission for developing and delivering innovation policies is called the Innovation Union. The Innovation Union is part of the Europe 2020 Strategy and comprises over thirty action points of which some are of specific relevance for regional innovation systems. Such points are include developing knowledge and skills through the modernisation of education and training systems and by encouraging innovative companies to improve the interoperability of products and innovative systems. Furthermore, in pursuing increasing social and territorial cohesion, structural funds are to be targeted at innovation activities, e.g. by financing innovation systems and smart specialisation strategies. A ground-breaking proposal within the Innovation Union are the European Innovation Partnerships that promote collaboration between regional, national and European stakeholders involved all along the chain of research and innovation.

  • 2.2 Framework programmes
    • The European Union possesses five key funding opportunities to support research and innovation: 1) the Research Framework Programme, 2) the Competitiveness and Innovation Framework Programme, 3) the Structural Funds and 4) the Cohesion Fund, as well as 5); the European Agricultural Fund for Rural Development and the European Fisheries Fund. Some of these programmes are outlined below.

      Competitiveness and Innovation programme (CIP)

      The Competitiveness and Innovation Framework Programme (CIP) supports innovation activities targeting small and medium-sized enterprises (SMEs). The programme, which runs from 2007 to 2013 encourages and provides support at the sector level and promotes the use of information and communication technologies (ICT). The programme has an overall budget of €3 621 million and is divided into three operational programmes, each of which has its own specific objective but which all aim at contributing to the innovative competitiveness of their specific area, such as ICT or sustainable energy.

      The different operational programmes 1) The Entrepreneurship and Innovation Programme (EIP), 2) The Information Communication Technologies Policy Support Programme (ICT-PSP) and 3)The Intelligent Energy Europe Programme (IEE) support and finance projects dealing with best practices, pilot actions, networking etc., involving both public and private organisations.

      The successor of CIP, the new programme for the Competitiveness of Enterprises and SMEs (COSME) has been approved for 2014 to 2020, with a planned budget of €2.5 billion.

      The Seventh Framework Programme

      The Seventh Framework Programme (FP7) is one of the key pillars for the European Research Area (ERA) that brings all research-related EU funding aiming at growth, competitiveness and employment together under one roof. The objectives are grouped under four categories: Cooperation, Ideas, People and Capacities, which work together to promote European scientific excellence. The programme started in 2007 and will last until 2013. The overall budget is just over €50 billion, which is granted to finance research, technological development and demonstration projects.

      The group Capacities is of distinct interest for innovation and innovation systems, mainly because it is designed to enhance and ensure the optimal use of knowledge, research and innovation capacities. The programme encompasses seven specific knowledge areas, including Research infrastructures, Research for the benefit of SMEs, Regions of knowledge and support for regional research-driven clusters, Research potential of Convergence Regions, Science in society, and Support to the coherent development of research policies and International cooperation.

      The next Framework Programme to implement the Innovation Union flagship initiative is called Horizon 2020. Running from 2014 to 2020 and with an overall budget of €80 billion, it will combine all former research and innovation funding of the research framework programmes, the innovation related activities of the Competitiveness and Innovation Framework Programme (CIP) and the European Institute of Innovation and Technology (EIT).

  • 2.3 Programmes and Initiatives
    • PRO INNO Europe

      Financed by the Competitiveness and Innovation Framework Programme (CIP11), the PRO INNO Europe was an innovation policy initiative running from 2006 to 2012. Pro Inno Europe mainly analysed and benchmarked national and regional innovation performance and innovation trends. In this respect, it was part of the overall policy coordination of the Commission with the Member States in the field of innovation and was intended to become the focal point of innovation policy analysis and development throughout Europe. PRO INNO was based on three pillars that accommodated eight modules together, thereby forming a wider integrated policy approach intended to develop new and better innovation policies founded on sound policy analysis, reliable statistics as well as on cooperation between policymakers and principal actors.

      Europe Innova

      Running from 2006 to 2012, Europe INNOVA, also financed through CIP, was a laboratory for the development and testing of new tools and instruments in support of innovation. The focus was on helping enterprises to innovate faster and better but also on bringing together public and private innovation support providers such as innovation agencies, technology transfer offices, business incubators, financing intermediaries, cluster organisations, etc.

      Europe INNOVA was designed to identify and analyse the drivers and barriers to innovation within specific sectors and thereby lead to sound and targeted support policy measures. Its sector-based approach reinforced cooperation between business clusters, finance and standardisation practitioners in Europe through the establishment of networks, i.e. learning platforms for exchanging experiences, best practices and knowledge to better serve SMEs.

      Regions of Knowledge

      The Regions of Knowledge initiative under the area ‘Capacities’ in the Seventh Framework Programme (FP7) supports and strengthens research potential across Europe. This is achieved by supporting the development of the capacities for excellent research, both at European, regional and local levels. Funding is directed towards research-driven clusters, associating universities, research centres, enterprises and regional authorities. The programme budget is €126 million over the duration of FP7. Regions of Knowledge is implemented in close relationship with the EU’s regional policy and the Competitiveness and Innovation Programme (CIP). Selected projects and activities will incorporate: analysis, development and implementation of research agendas for regional or cross-border clusters, mentoring of regions with a less-developed research profile by highly developed ones, initiatives to improve integration and dissemination through activities such as conferences, workshops, publications, etc.

      Regions for Economic Change

      Regions for Economic Change is a learning platform for EU regions looking to emphasise and share good practices used in urban and regional development innovation. Activities included are the annual Regions for Economic Change Conference and Regio Stars Awards, a Policy Learning Database and interregional fast track networks that test innovative ideas and initiate the transfer to policy and programmes. It supports the EU policy objectives of smart, sustainable and inclusive growth, as outlined in the EU’s 2020 strategy and funded by programmes such as INTERREG IVC and URBACT II (12)

      To help achieve these aims, Regions for Economic Change introduces a thematic scheme in which one of the themes, ‘Improving the capacity of regions for research and innovation’, is of special interest. Within this theme support is provided to projects that deal with ways to create efficient regional innovation systems by analysing research capacities, industrial and employment structure, human resources, infrastructure (including virtual infrastructure), financial markets, education and training facilities, business and innovation support services, etc.

      Research and Innovation Strategies for Smart Specialisation (RIS) – Smart Specialisation Strategies

      The S³ Platform (S³P) supports Member States and regions to develop, implement and review Research and Innovation Strategies for Smart Specialisation (RIS³). The S³ P was established in 2011 and contributes to smart growth by providing and supplying information, methodologies, expertise and advice to national and regional policy actors, as well as contributing to academic debate on the concept of smart specialisation. S³P, which is hosted by the Institute for Prospective Technological Studies (IPTS) in Seville, part of the European Commission's Joint Research Centre, contains three parts: 1) project management and a research team at the IPTS, 2) a Steering Team bringing together representatives from several Commission Services and 3) a Mirror Group composed of leading academics and experts in the fields of innovation and regional development, as well as representatives of different networks.

3. Added value of interregional co-operation on the topic Innovation systems (triple helix & open innovation)

A negative effect of increasing competition for skilled workers, investments and companies could very well be that regions, in particular the more successful ones, ring-fence their territories towards competitors leading to the further fragmentation of the European ‘innovation area’. Luckily, this seems to be a quite limited problem in reality.

The success of the Innovating Regions of Europe Network (with over 100 members when it closed in 2008) and the opening up, in the past programming period, of the trans-national and interregional co-operation programmes (INTERREG) to the topic of innovation has clearly proved that there is a strong willingness and commitment among European regions to co-operate, to share experiences and to act jointly.

Depending on the type of framework provided by the individual European programmes, regions can benefit in many different ways from interregional co-operation. In this respect, Innovation systems (triple helix & open Innovation) is a topic that is particularly suitable for sharing policies and practices on how to foster innovation at regional level. The individual themes addressed by such policies and practices can be of quite a different nature as we will show in this report. The important acknowledgement, however, is that there is a significant learning potential embedded in interregional exchange, as facilitated by the INTERREG IVC programme; learning that will not only result in the uptake of new practices by a number of regions but also in a more profound integration of modern innovation policies better suited to enhance the efficiency of regional innovation systems. This, in turn, will make European companies more sustainably competitive, thus improving the well-being of European citizens.

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