1. Discovery process of a smart specialisation strategy: The Flemish case
Jan Larosse – Flemish Government
DG Regio Staff Training on Smart Specialisation
Brussels, 14 December 2011

2. FLANDERS: Key Figures Flanders: a prosperous region
with an open economy in the core of Europe
medium innovation performer
Population: 6.3 million (= 57% BEL)
Language: Dutch
Surface: km² (= 45% BEL)
GDP: €220 billion (= 57% BEL)
Export: 100.3% of GDP (=73.3%BEL)
GERD/GDP: 2.12% (2009). Target 3% for 2020
Total public budget STI policy: €1.9 billion of which €1.23 billion R&D
‘Innovation follower’ (Innovation Union Scoreboard).
The region has constitutional competences on
research, innovation and economic policy

3. Successive steps in the ‘discovery process’ of a Smart Specialisation Strategy in Flanders
: ‘Flanders in Action’ and ‘Pact 2020’ A comprehensive strategic framework for socio-economic structural change
2011: Six ‘Innovation Crossroads’ A challenge driven innovation policy
: Transformation processes for future markets A new industrial policy
2012: A next step towards sharper prioritisation A targeted cluster policy

4. 1. ‘Flanders in Action’: a comprehensive strategic framework for change
‘Flanders in Action’ (ViA): strategic framework for a new growth path
Change was needed because of persisting competitiveness problems
ViA = long-term future project of the Flemish government (starting 2006)
‘Pact 2020’,supported by +100 stakeholder organisations in 2009
Aiming at a ‘top 5 region’ position in Europe = transition towards an innovation driven growth model,
Consensus that STI investments should be focussed on ‘spearheads’: domains that can position Flanders in future value chains with important societal and economic impact.
20 objectives in five principal domains (yearly monitoring of target figures)
1.      greater prosperity and welfare;
2.      a competitive and sustainable economy;
3.      more workers gainfully employed, in more suitable jobs, and for longer average career terms;
4.      a high quality standard of living;
5.      an efficient and effective administration.
The Science&Innovation Advisory Council (VRWI) selected 10 ‘spearheads’ (breakthrough initiatives) in 6 Cluster domains (still mainly technology driven)

5. Focussing on spearhead initiatives in 6 ‘clusters’
Departure from a pure ‘bottom-up’ innovation support policy
Focussing public S&T resources on 6 thematic ‘clusters’ identified by strategic intelligence and expert consultation
Still large domains: ‘Innovation Direction Groups’ should advise strategies for industrial sectors (automotive, sustainable chemistry)
SWOT Analysis of Flanders vs EU
EU Foresight Study with 15 key areas

6. 2. ‘Innovation Crossroads’: challenge driven innovation policy
Societal challenges recognised as driver of a new innovation strategy
(‘Innovation Centre Flanders’: concept note adopted by Flemish Government on May 27th 2011)
Departure from a purely bottom-up research and innovation policy
Six ‘innovation crossroads’ are identified for the development of specific innovation strategies
Eco-innovation
Green energy
Sustainable mobbility and logistics
Innovation in care
Social Innovation
Industrial transformation (specified along certain core sectors)
‘Innovation crossroads’ are a space where interdisciplinary research and open innovation can contribute to societal and economic value creation.
Innovation Directory Groups are assigned by the Minister to advise on such strategies (ongoing)

7. NEW INDUSTRIAL POLICY in Flanders: an integrated framework for transformation of the economy
White Paper ‘New Industrial Policy’ (27 May 2011): Integrated policy platform for economic transformation with 4 pillars
A ‘New Productivity Offensive’: targeting unexploited sources of productivity growth in resource productivity, smart infrastructures, clusters, specialisation.
A strong vision: ‘Factory of the Future’: a vision of a sustainable, innovative, flexible and networked economy centred on the ‘real economy’
A strong management structure: An interministrial body and interdepartmental coordination
A strong stakeholder based process for discovering new growth opportunities: Secoral policies with ‘Roundtables’

8. New Industrial Policy in Flanders: New governance for new transformation strategies
New ‘strategic governance’ for transformation:
Interministrial Committtee Industry (Economy, Innovation, Work)
Industry Council (Targeted cluster policy)
Interdepartmental Coordination 4 Policy Pillars
1. Productivity & competitiviness policy
2. Industrial Innovation policy
3. Competences & labour market policy
4. Supportive infrastructure policy
S&I Council (Innovation Crossroads)
Sector policy
(Transformation action plans)
NEW!

9. 3. Transformation processes: core of New Industrial Policy
A ‘Renewing Sectoral Policy’ as main implementation strategy
Round Tables are organised with sectoral partners to elaborate ‘Strategic Agendas’ for transformation in all sectors (included are new arrangements for policy coordination)
Focus is on ‘transformation strategies’ based on value chains, clusters and grand projects (cross-sectoral)
A three steps entrepreneurial discovery process
Visioning: with focus on sustainablity (transition management / experiments)
Strategy development: focus on societal challenges and transformation by innovation (strategies within innovation nodes)
Action plan: with focus on investment projects in transformation action plans driven by frontrunners (core of the Round Tables)
Frontrunner: FISCH (Flanders Initiative for Sustainable Chemistry) The sector federation developed from 2007 onwards a transformation strategy, supported by a broad mobilisation in the sector and beyond (more than 700 participants), in 3 parts: a strategic research programme on renewable materials and process intensification; open innovation infrastructures; new business models (e.g. chemical leasing) and sustainability criteria

10. ‘TINA’: a new public investment fund to leverage transformation
Transformation & INnovation Accelleration Fund
Launched March 2011
Key part of New Industrial Policy: support transformation trajectories
€ 200 million (to be expanded) to facilitate industrial transformation by innovation
Minority equity stakes and subordinated loans with commercial return
Policy rationale: a missing-link in financing to promote open innovation & manufacturing consortia
An innovative financial instrument
Investments can only take place in consortia
Requirement of transformation strategy (on the level of value chain and cluster) and vision on go-to-market is required
Involvement of a lead-company (and spill-overs to SMEs)
Presence of a detailed implementation plan and exit strategy
Managed by PMV, the public investment company, to leverage ‘public’ returns

11. Smart Specialistion case-studies (OECD-TIP project on smart specialisation in global value chains)
Action Learning= simultanious policy learning and policy development
Two transformation cases in need of smart specialisation strategies:
Case 1: Sustainable Chemistry
Largest petro-chemical cluster in Europe in Flanders; strong links with food, building e.o. sectors; cross-border links with NL and DE
Transition towards bio-based economy
How to become a world-class cluster in sustainable chemistry?
Focus on strategic road mapping (cross-border!)
Case 2: Nano-for-Health
IMEC: largest independent nano-electronics research institute in Europe; technology platform for open innovation
Health: transition towards ‘personalised care’
How to leverage technology platform for these new application areas?
Focus on the management of an emerging eco-system (cross-border!)

12. 4. Targeted cluster policies
New developments in the framework of New Industrial Policy:
The Industry Council (expert advisory council) is launched in November 2011: one of its key assignments is to advise on the development of a ‘targeted cluster policy’ (lead clusters).
A pilot cluster approach is launched for sustainable chemistry
The sector federation developed a transformation strategy supported by a broad mobilisation in the sector and beyond (more than 700 actors): FISCH (Flanders Initiative for Sustainable Chemistry) = strategic research; open innovation infrastructures; new business models (e.g. chemical leasing) and sustainability criteria for the design of innovations
The governement supports the establishment of a ‘Competence Pool’ for the strategic research programma of FISCH (5 mio euro/year)
International policy learning: lead-role in new OECD project ‘Smart Specialisation in Global Value Chains’
Use of strategic monitoring & case-studies for ‘discovery’ of smart specialisation
Aimed at criteria for identifying smart specialisations & design strategies

13. Conclusion: elements of a smart specialisation strategy
Smart specialisation is a policy approach for prioritisation of public RDI investments for transition periods. Strategies are developed in a multi-actor and multi-level policy environment. Based on the Flemish experience they contain following elements:
A comprehensive policy framework for socio-economic change
Wide societal mobilisation for a transition
Integrated policy approaches
A targeted innovation policy
Societal challenges as driver for new opportunities
Strategies advised by domain experts and informed by foresight
An economic transformation policy
Policies at structural level (value chains and clusters)
System innovation based on frontrunners and grand projects
An enhanced cluster policy
Enhanced with strategic governance for making choices
Outward looking (international value chains; EU policy priorities)

14. Successive steps in the ‘discovery process’ of a Smart Specialisation Strategy in Flanders
: ‘Flanders in Action’ and ‘Pact 2020’ A comprehensive strategic framework for socio-economic structural change
2011: Six ‘Innovation Crossroads’ A challenge driven innovation policy
: Transformation processes along value chains for future markets A new industrial policy
The next step towards sharper prioritisation A targeted cluster policy

15. Smart Specialisation discovery process

16. www.ewi-vlaanderen.be | info@ewi.vlaanderen.be
  Jan Larosse, Policy Advisor, T: E:  
Department of Economy, Science and Innovation (EWI) Koning Albert II-laan 35 box 10, 1030 Brussels |