Definition of Innovation

1
Definition of Innovation

• 2nd WG Meeting on
• Regional Innovation Systems
• Vienna
• Yannis Pierrakis
• IRE Secretariat

2
Conceptual and practical relevance of RISs

• Literature on RISs has grown exponentially in
  recent years
• Its conclusions have also been used widely as a
  framework for the design and implementation of
  policies in a variety of regional contexts
• Large number of less developed regions have
  designed innovation strategies aimed at nurturing
  regional innovation systems (e.g. in the context
  of EU funded RIS/RITTS initiatives)
• Countries without strong regional
  administrations, e.g. some Scandinavian
  countries, also employ RI strategies as policy
  tools

3
Theoretical approaches to Innovation

• Linear vs. Interactive model of Innovation
• Incremental vs. Strategic Innovation
• Schumpeterian vs. Usherian model of
  Innovation

4
The Linear vs. the Interactive Model of
Innovation

• Linear Model
• RD is the key to innovation
• A chain that links different activities in order

Product Commercialisation
Product Development
Applied Research
RD

• More RD generates more Innovation

5
The Linear vs. the Interactive Model of
Innovation

• Interactive Model
• Innovation is the outcome of an interactive
  process in which many actors from different
  levels are involved
• Innovation does not take place from left to the
  right (Nelson Winter 1982)
• The starting point does not have to be the
  academia, the impulses and idea could come from
  the market or the production spheres (Halvorsen
  Lancave 1998)
• No specific order of interaction amongst players
• Ideas generated at all stages and processes
• Basic research not the sole initiator

6
Incremental vs. Strategic Innovation

• Incremental
• Innovation that is being continually carried out
  through sometimes small changes in the products,
  processes and management practices, that are
  being used by the SME sector or through the
  adoption or adaptation of technologies that
  already exist in other sector firms
• Strategic
• Strategic innovation or breakthrough
  innovation. Radical idea, a completely new
  product

7
Schumpeterian vs Usherian model

• Schumpeterian
• Innovation is fundamental. The model promotes
  innovation by introducing a breakthrough in the
  form of an entirely new product
• Usherian
• It describes a gradual and incremental process
• It has an inherent limitation when taken as the
  basis for regional innovation policy since it is
  largely preoccupied with existing products and
  with making incremental improvements to these
  rather than seeking new breakthrough or step
  change opportunities for the region

8
Definitions of Innovation

• putting new products and services on the market
  or new means of producing them (Bannock 1992)
• the economic application of a new idea (Black
  1997)
• the implementation of changes in production ()
  or the introduction of new types of commodities
  on the market (Suranyi-Unger 1982)
• what matters is not the environmental
  circumstances in which a innovation is created,
  but rather the ability and willingness of
  consumers to adopt and use the innovation
  (Amendola Bruno 1990)

9
Definitions of Innovation

• The most fundamental feature of an innovation
  is that is something new
• It can be a new product or a new process or
  following Schumpeter a new combination
• The improvement of intangible assets are basic
  elements for the innovation process

10
Definitions of Innovation Systems

• The concept of Innovation System is based upon
  the interactive model
• The key feature of the concept is that a regions
  ability to generate innovation does not only
  depend on how individual actors perform but
  rather on how they interact as part of the system

11
Definitions of Innovation Systems

• The innovation system of a specific territory
  consists of a geographically defined,
  administratively supported arrangement of
  innovative networks and institutions that
  interact regularly and strongly to enhance the
  innovative outputs of firms in the region. Such a
  network is composed of institutions such as
  research institutes, universities, technology
  transfer agencies, chambers of commerce, banks,
  investors, government departments, individual
  firms as well as firm network and industry
  clusters. The main aim of the institutional
  setting of the regional innovation system is to
  support firms in their innovation needs in the
  context of increasing global competitiveness and
  rapid technological change. (Cooke and
  Schienstock 2000)

12
Definitions of Innovation

• The innovation system of a specific territory
  consists of a geographically defined,
  administratively supported arrangement of
  innovative networks and institutions that
  interact regularly and strongly to enhance the
  innovative outputs of firms in the region. Such a
  network is composed of institutions such as
  research institutes, universities, technology
  transfer agencies, chambers of commerce, banks,
  investors, government departments, individual
  firms as well as firm network and industry
  clusters. The main aim of the institutional
  setting of the regional innovation system is to
  support firms in their innovation needs in the
  context of increasing global competitiveness and
  rapid technological change. (Cooke and
  Schienstock 2000)

13
Definitions of Innovation

• Innovation is first and foremost a collective
  social endeavor, a collaborative process in which
  the firms, especially the small firm, depends on
  the expertise of a wider social constituency than
  is often imagined (workforce, suppliers,
  customers, technical institutes, training bodies,
  etc.. (Cooke and Morgan 1994)

14
References

• Nelson, R. Winter, S. (1982), An evolutionary
  theory of economic change, Harvard University
  Press, Cambridge, Massachusetts
• Halvorsen, K. Lacave, M. (1998), Innovation
  Systems in Urban Areas, NIBR Working Paper
• Bannock, G. et al. (1992), The Penguin dictionary
  of Economics 5ed, Penguin Books, London
• Black, J. (1997), A Dictionary of Economics,
  Oxford University Press, Oxford
• Suranyi-Unger, T. (1982), Innovation, in
  Greenwald, D. (1982), Encyclopedia of Economics,
  McGraw Hill, New York
• Cooke, P. and G. Schienstock (2000) 'Structural
  Competitiveness and Learning Regions', Enterprise
  and Innovation Management Studies, Vol. 1, No. 3
• Cooke, Ph., Morgan, K. (1994) The Creative
  Milieu A Regional Perspective on Innovation,
  In The Handbook of Industrial Innovation, M.
  Dodgson, R. Rothwell (eds.), Edgar Elgar
  Publishing

15
Thank you

• y.pierrakis_at_innovating-regions.org