Presentation on theme: "Measuring innovation SUB-REGIONAL HANDS-ON TRAINING ON SCIENCE, TECHNOLOGY AND INNOVATION INDICATORS Damascus, Syria 18-20 September 2010."— Presentation transcript:
1 Measuring innovationSUB-REGIONAL HANDS-ON TRAINING ON SCIENCE, TECHNOLOGY AND INNOVATION INDICATORSDamascus, Syria September 2010
2 Measuring InnovationOslo Manual – 2005 (Guidelines for collecting and interpreting innovation data)UIS - Annex to the Oslo Manual on Measuring Innovation in Developing countries
3 Why measure innovation? Innovation – key to the growth of output and productivity.The relationship between innovation and economic development is widely acknowledged.Innovation policy should be evidence-based.Innovation datato better understand innovation and its relation to economic growth;to provide indicators for benchmarking national performance.
5 Innovation: definition (Oslo Manual 2005) The implementation of:Technological innovationNew or significantly improved product (good or service); orNew process; orNon-technological innovationNew marketing method; orNew organisational method.
6 Types of innovations Product innovation Process innovation Marketing innovationOrganisational innovation
7 Diffusion and degree of novelty How innovations spreadWithout diffusion no economic impactNew to the firmNew to the marketNew to the worldDisruptive innovationsinnovation with significant impact on a marketfocuses on the impact of innovations as opposed to their noveltyMay become apparent only long after the innovation has been introduced.
8 Innovation activities All scientific, technological, organisational, financial and commercial steps which actually, or are intended to, lead to the implementation of innovations.Some innovation activities are themselves innovative, others are not novel activities but are necessary for the implementation of innovations.Innovation activities also include R&D that is not directly related to the development of a specific innovation.
9 Innovation activities for product and process innovations Intramural (in-house) R&DAcquisition of R&D (extramural R&D)Acquisition of other external knowledgeAcquisition of machinery, equipment and other capital goodsOther preparations for product and process innovationsMarket preparations for product innovationsTraining
10 Innovation activities for marketing and organisational innovations Preparations for marketing innovations: activities related to the development and implementation of new marketing methods.Includes acquisitions of other external knowledge and other capital goods that are specifically related to marketing innovations.Preparations for organisational innovations: activities undertaken for the planning and implementation of new organisation methods.Includes acquisitions of other external knowledge and other capital goods that are specifically related to organisational innovations.
11 Kinds of innovation activities Successful in having resulted in the implementation of a new innovation (though they need not have been commercially successful).Ongoing, work in progress, which has not yet resulted in the implementation of an innovation.Abandoned before the implementation of an innovation.
12 Classifying firms by degree of innovativeness Innovative firmThe innovations need not have been a commercial success – many innovations failInnovation active firmRegardless of whether the activity resulted in the implementation of an innovationPotentially innovative firmInnovation efforts but no achieved results.Key element for innovation policyAnnex for developing countries.
13 Factors influencing innovation ObjectivesIdentifying enterprises’ motives for innovating and measuring their importance.Hampering factorsReasons for not starting innovation activities at all, or factors that slow innovation activity or have a negative effect on expected results.
14 Objectives and effects of innovation Competition, demand and marketsReplace products being phased outIncrease range of goods and servicesDevelop environment-friendly productsIncrease or maintain market shareEnter new marketsIncrease visibility or exposure for productsReduced time to respond to customer needsProduction and deliveryImprove quality of goods and servicesImprove flexibility of production or service provisionIncrease capacity of production or service provisionReduce unit labour costsReduce consumption of materials and energyReduce product design costsAchieve industry technical standardsReduce production lead timesReduce operating costs for service provisionIncrease efficiency or speed of supplying and/or delivering goods or servicesImprove IT capabilitiesWorkplace organisationImprove communication and interaction among different business activitiesIncrease sharing or transferring of knowledge with other organisationsIncrease the ability to adapt to different client demandsDevelop stronger relationships with customersImprove working conditionsOtherReduce environmental impacts or improve health and safetyMeet regulatory requirements
15 Factors hampering innovation activities Knowledge factors:Innovation potential (R&D, design, etc.) insufficientLack of qualified personnel: Within the enterprise / In the labour marketLack of information on technology / marketsDeficiencies in the availability of external servicesDifficulty in finding co-operation partners for: Product or process development / Marketing partnershipsOrganisational rigidities within the enterprise: Attitude of personnel/ managers towards change, Managerial structure of enterpriseInability to devote staff to innovation activity due to production requirementsInstitutional factors:Lack of infrastructureWeakness of property rightsLegislation, regulations, standards, taxationCost factors:Excessive perceived risksCost too highLack of funds within the enterpriseLack of finance from sources outside the enterprise: Venture capital / Public sources of fundingMarket factors:Uncertain demand for innovative goods or servicesPotential market dominated by established enterprisesOther reasons for not innovating:No need to innovate due to earlier innovationsNo need because of lack of demand for innovations
16 Impacts and outcomes Impacts of innovations effects on sales and market sharechanges in productivity and efficiencychanges in international competitiveness and in total factor productivity,knowledge spilloversincrease in the amount of knowledge flowing through networks.Outcomes of product innovations% of sales derived from new or improved products.
17 Linkages are crucialLinkages between the firm and government laboratories, universities, policy departments, regulators, competitors, suppliers, and customers.Links to sources of information, knowledge, technologies, practices, and human and financial resources.Types of external linkages:Open information sourcesAcquisition of knowledge and technology.Innovation co-operation
18 Sources for transfers of knowledge and technology Open information sourcesSources for purchases of knowledge& technologyCo-operation partnersInternal sources within the enterprise:R&DProductionMarketingDistribution*Other enterprises within the enterprise groupExternal market and commercial sources:CompetitorsOther enterprises in the industryClients or customersConsultants/consultancy firmsSuppliersCommercial laboratoriesPublic sector sources:Universities and other higher education institutionsGovernment/public research institutesPrivate non profit research institutesSpecialised public innovation support svcsGeneral information sources:Patent disclosures / Professional conferences, meetings, literature and journals / Fairs and exhibitions / Professional associations, trade unions / Other local associations / Informal contacts or networks / Standards or standardisation agencies / Public regulations (i.e. environment, security)
19 Data collection: survey approach The “subject” based approachinnovative behaviour and activities of the firm as a wholeThe “object” approachcollection of data about specific innovationsThe subject approach is the one chosen for innovation surveys.
20 Combining innovation & R&D surveys ProReduce overall response burdenAnalysing relation between R&D and innovation at the unit levelIncreases the frequency of innovation surveysAgainstLength of questionnaireConfusion between the concepts of R&D and innovationDifferent survey framesPossibility of merging with other business surveys (e.g. ICT, knowledge management practices)
21 Expenditures Current innovation expenditures Capital expenditures labour costsother current costsCapital expendituresland and buildingsinstruments and equipmentcomputer software
22 Classification by main economic activity Data broken down by Principal economic activity of the statistical unit (“industry”), according to the International Standard Industrial Classification (ISIC Rev. 3.1)
23 Classification by size Number of employees10-4950-249250 and aboveDetailed1 - 95 000 and above.
24 Classification by type of institution Private enterprise:National (no Controlled Affiliates (CA) abroad)MultinationalPublic enterprise:Resident non-financial corporations and quasi-corporations that are subject to control by government units.
25 Annex to the Oslo Manual Developing countries conduct innovation surveys as well.Following Oslo Manual standards, but with adaptations for capturing the particular characteristics of innovation processes.Latin American adaptations captured in the Bogotá Manual, published by RICYT.
26 Annex to OM (continued) Annex to Oslo Manual 3rd edition: Innovation surveys in developing countries.UIS circulated a base document prepared by RICYT to a vast network of experts in the developing world covering China, Thailand, Singapore, Malaysia, Hungary, India, Lebanon, South Africa, and Tanzania.UIS drafted the final annex based on this input.
27 Characteristics of innovation in developing countries Size and structure of markets and firmsInstabilityInformalityParticular economic and innovation environmentsReduced innovation decision-making powersWeak innovation systemsCharacteristics of innovation
28 Innovation measurement in developing countries Definitions unchangedBut incorporating the concept of potentially innovative firmMeasurement priorities:Innovation capabilitiesHuman resourcesLinkagesQuality assurance systemsICTsExpenditure on innovation activitiesOrganizational innovation
29 Principal adaptations ICTs in innovation surveysstrategic use of new technologies (Front office vs Back office)Linkagesmatrix of ‘linkage agents’ and ‘types of linkage’geographical location of linkages; local, regional, nationalInnovation ActivitiesHardware purchase, and Software purchaseIndustrial design, and Engineering activitiesLease or rental of machinery, equipment and other capital goodsIn-house software system developmentReverse engineeringHuman resources (by qualification, occupation, gender) and trainingQuality and environmental management
30 Methodological issues for developing country contexts Weakness of statistical systemsRunning the surveyQuestionnaire designFrequencyPublicationDifficultieslack of appreciation of the importance of innovationmanagers are secretive about financelack of adequate legislative base
31 Thinking aheadThe role of entrepreneurs and their attitudes towards innovation.The intention to capture innovations driven by factors other than market forces, in particular public sector innovations.Innovation in the primary sector (particularly in agriculture).Better measuring minor or incremental changes, including innovative applications of existing products or processes, and the so-called 'backwards integration' of technological capability.The development of indicators reflecting sub-national (regional) innovation systems.
32 Issues arising in the follow-up to the Annex Innovation in informal sector?Innovation from traditional knowledge?Surveying innovation, rather than R&D, in business (and informal) sector?