Executive Summary

Overview of topicPublicationReport

Innovation Systems overview

Innovation Systems publicationInnovation Systems report

Report presented by Prof. Dr. Peter Heydebreck and Nils Gabrielsson

A regional innovation system is “... that set of distinct institutions which jointly and individually contribute to the development and diffusion of new technologies and which provides the framework within which governments form and implement policies to influence the innovation process. As such, it is a system of interconnected institutions to create, store and transfer the knowledge, skills and artefacts which define new technologies.” (Metcalfe, 1995) (1)

Drawing on such theoretical insights, European regions today are striving to foster competitiveness of regional industry by design and implementing innovation policies and measures. The INTERREG IVC programme offers a unique pan-European arena for exchanging experiences and learning from each other on how to formulate even better innovation policies. The ten projects included in this capitalisation exercise have utilised the potential of exchange and learning to a maximum. Overall, projects have identified and processed over 500 good practices and documented approximately 200.

Our analysis shows that, although the projects have been designed in differing regional contexts, they share a number of common traits, in particular when it comes to the fundamental problems related to regional innovation systems. It can be concluded, for example, that lack of resources in regional innovation systems is not normally considered to be a key bottleneck. Rather, the main problem is system fragmentation caused by weak governance structures and lack of dynamics. Governance in this context should be understood as the ability of a region to ensure the optimal efficiency of its innovation system, in particular by aligning regional resources to work in joint strategic directions. The lack of dynamics is related to the challenge of renewing the innovation system by integrating new ideas or working models. As for the publicly funded organisations in innovation systems, the issues of institutional lock-in, a lack of resources and insufficient inter-organisational exchange are common.

The analysis of the projects’ good practices indicates the existence of a number of conceptually similar thematic areas that are addressed in many of the projects. The thematic areas most commonly addressed by good practices are 1) Spin-offs and incubation, 2) Cluster development and management, 2) Technology transfer/Research commercialisation and 3) Linking SMEs to knowledge providers. A relatively large number of good practices are close to each other in terms of purpose and how they work. Although conceptually similar, few or no schemes are identical, though. It should be mentioned here, however, that there are also thematic areas which are not so well covered by good practices although they receive much attention in the European debate. Two such themes are ‘Venture and early stage funding’ and ‘Internationalisation’. The INTERREG IVC projects we have reviewed do provide some examples of good practices in these fields but not in proportion to the attention given in debate.

From the analysis, we can also draw the conclusion that the transfer of good practices is a challenging task, even if many projects share challenges, objectives and even look for similar types of good practices. There are a number of reasons for the difficulties of actually transferring. The key barrier seems to be the absorption capacity of regional policymakers. In many cases, there is also insufficient involvement of policymakers in the projects. Furthermore, it should be pointed out that there may be a conflict between 1) the innovativeness of a practice, 2) proven success and 3) transferability. We have observed that it is often the simpler (and often less innovative) practices that are transferred between regions whereas highly successful practices with proven impact have often developed in a specific context over a long period of time - something that tends to make quick transfer less feasible. The difficulty of actually transferring a practice within the framework given by the INTERREG programme is often highlighted. In fact, it is probably true that a certain proportion of the practices claimed to be ‘in transfer’ are instead more likely to be influencing policies (strategies, guideline, etc.) than becoming stand-alone regional programmes or initiatives.

We can conclude that our analysis has brought forward evidence that the projects within the topic ‘Innovation systems (triple helix & open innovation)’ have contributed in positive ways to enhancing the capability of participating regions to develop and improve regional innovation systems. In particular, we would like to highlight the following areas where we believe that impacts are the clearest:

  1. Helping regions to overcome lock-in effects
  2. Increasing their capability to design effective innovation policy
  3. Increasing their capability to implement better innovation policy measures
  4. Good complementarity and potential synergies with other EU-programmes
  5. Creating a pan-European network of professionals

It is within this framework that the projects covered by this analysis have been working, and it is within this framework that the main outcomes and messages should be understood as they are most usefully presented at different levels of abstraction: (2)

1. Contributing to better regional innovation policy by transferring good practices

For regions that want to take up a new innovation measure in its portfolio, the following recommendations are crucial:

  • Ensure a clear definition of the practice to be taken up.
  • Ensure that the stakeholders that are to be involved in the process possess the necessary capacity. Is sufficient funding available? or is it feasible to make the financial arrangements required?
  • Ensure that commitment to the new practice is in place at all relevant levels of government (city council, regional authorities, etc.)
  • Review and assess the stability of the political and financial situation of the region.
  • Assess the legislative and/or regulatory situation related to the new practice.
  • Analyse if companies will welcome the new practice. Does the new practice fit the local habits and routines of companies and public bodies?
  • Make sure that potential environmental impacts as well as equal opportunities and gender issues are taken into account.

2. Region specific recommendations for policy transfer aiming at better innovation systems

  • Implementing regional policies requires an understanding of the region’s characteristics, its potential and ‘enabling’ conditions, but also its needs and possibly any ‘hampering’ conditions, both in terms of players and structures.
  • Stakeholder involvement and commitment is crucial. This is true for both good practice transfer and implementation.
  • The capability to adapt an existing policy to regional structures and conditions is of uttermost importance. Flexibility of policies, including on the part of the stakeholders, is noted as being a enabling factor for successful policy implementation.

3. General policy recommendations – normative characteristics of regional innovation systems

  • Successful innovation systems display dynamic and flexible structures and processes that facilitate the diffusion of knowledge throughout the economy. In particular, it is crucial to take regional specific context better under consideration. (3)
  • Successful innovation systems are networked mutual learning systems. All members of a regional innovation system should closely interact and learn from and in cooperation with each other, not (exclusively) from each other.
  • Successful systems are both sustainable and flexible in responding to modified/new challenges and context factors.
  • Successful innovation systems possess substantial resources and critical mass. Such systems have well developed links with external systems from which they can access complementary know-how and competencies.
  • Successful innovation systems have a demand-orientation and provide firms with knowledge and resources in respect to all key determinants of success in innovation processes, in particular (but not exclusively) in respect to technology, management, marketing, and financial means.

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