2. Outline
1. An innovation system approach
2. National Systems of Innovation
3. Global Innovation Index 2015
3. An innovation system approach
An innovation system:
can be defined as a group of private firms, public
research institutes, and several of the facilitators of
innovation,
who in interaction promote the creation of one or a
number of technological innovations [within a framework
of] institutions…
which promote or facilitate the diffusion or application of
these technological innovations
4. An innovation system approach
The different SI approaches can be characterized and
compared by investigating how they deal with the
following six dimensions
System
boundaries
Actors and
networks
Institutions
Knowledge Dynamics
Policy
implications
5. An innovation system approach
SI approaches share certain characteristics:
Focus on innovation and they all place great emphasis on
the learning process in which all actors involved,
experience a 'learning‐by‐doing' process or learn from
each other by exchanging knowledge.
Systems of innovation are always defined as complex
systems, stressing their non‐linear, systemic, interactive
and evolutionary character
The performance of all SI approaches is analyzed in a
similar way, namely through historical analyses of
economic or innovative activity and knowledge diffusion.
6. National Systems of Innovation
Chris Freeman
1987
Bengt-Åke Lundvall
1992
Richard Nelson
1993
7. An innovation system approach
4 elements of the Japanese NSI:
the role of policy (in particular the role of the Ministry of
International Trade and Industry)
the role of corporate research and development (R&D) in
accumulating knowledge and developing advantages
from it
the role of human capital, the organization of work and
the development of related capabilities
the role of industrial conglomerates in being able to profit
from innovations emerging from developments along the
entire industrial value chain
8. An innovation system approach
National Systems of Innovation building blocks
according to Lundvall (1992)
9. An innovation system approach
National Systems of Innovation according to Soete
(2012)
NationalSystemsof
Innovation
Sourse of innovation
Institutions
Interactive Learning
Interaction
Social capital
10. An innovation system approach
Source of innovation
Classical economics approaches to innovation had relied
mostly on an analysis of R&D. However, it is not only R&D
that is crucial in innovation. Producer‐consumer relations
provide a source of innovation, as do the purchase and
availability of equipment and the training of workers. Thus
innovation occurs in production, distribution, and
consumption
11. An innovation system approach
Institutions
Market and non‐market institutions constitute the national
innovation system, providing the framework for
governments to implement policies in order to influence the
process of innovation.
In a country without reliable governance structures,
somebody with the same talent who works just as diligently
might still end up extremely poor. The importance of
institutions must therefore not be underestimated.
12. An innovation system approach
It emphasizes the importance of continuous learning in
order to adapt to changes. This also demonstrates the
connection of the NSI (National System of Innovation) to
concepts such as human resource management, labour
market institutions and learning capacities of firms as well
as to absorptive capacities of firms and the economy as a
whole.
Interactive Learning
13. An innovation system approach
Since innovation is considered to take place almost
exclusively within interaction, successful systems of
innovations are capable of producing an environment of
continuous knowledge production, knowledge use and
innovation.
However, the interaction is mostly coordinated by
institutions and thus an institutional environment which
leads to inefficient coordination of interactions may cause
failure of the whole innovation system.
Interaction
14. An innovation system approach
It is argued that, the greater the degree to which
institutions in a system are advanced, the more social
capital in the form of trust they show. Trust in turn has a
positive influence on the rate of innovation since trust
reduces the risk that accompanies innovation and
especially the risk of financing innovation
Social capital
16. National Systems of Innovation
Strong local ‘demand pull’ for certain types of
product generates innovation opportunities for local
firms, especially when the demand depends on
face-to-face interactions with customers.
Patterns of national demands
17. National Systems of Innovation
Factors in Examples
Local buyers’ tastes • Quality food and clothing in France and Italy
• Reliable machinery in Germany
Private investment
activities
• Automobile and other downstream investments
stimulating innovation in computer-aided design and robots
in Japan, Italy, Sweden and Germany
Public investment
activities
• Railways in France
• Medical instruments in Sweden
• Coal-mining machinery in the UK (<1979)
Input prices • Labour-saving innovations in the USA
• Europe–USA differences in automobile technology
• Environmental technology in Scandinavia
Local natural
resources
• Innovations in oil and gas, mineral ores, and food
and agriculture in North America, Scandinavia and
Australia
18. National Systems of Innovation
Case studies and statistical analysis show that
competitive rivalry stimulates firms to invest in
innovation and change, since their very existence
will be threatened if they do not.
Lack of competitive rivalry makes firms less fit to
compete on global markets through innovation.
Competitive rivalry
19. National Systems of Innovation
In many countries, national advantages in natural
resources and traditional industries have been
fused with related competencies in broad
technological fields that then become the basis for
technological advantage in new product fields.
Competencies in Production and Research
21. National Systems of Innovation
Firms’ innovative behaviours are strongly influenced
by the competencies of their managers and the
ways in which their performance is judged and
rewarded (and punished).
Institutions: Finance, Management and
Corporate Governance
22. National Systems of Innovation
1. They will be the sources of firms with a strong
capacity to compete through innovation.
2. They are also potential sources of improvement
in the corporate management of innovation, and in
national systems of innovation.
3. Firms can benefit more specifically from the
technology generated in foreign systems of
innovation.
Learning from Foreign Systems of Innovation
23. National Systems of Innovation
Outside sources of technical knowledge for large European
firms: percentage judging the source as very important
25. Global Innovation Index 2015
Ukraine Ranks #33 In Top 50 Innovative Countries 2015
Ukraine has made a huge leap in Bloomberg's Annual Global
Innovation Index 2015: in just one year, our country has jumped from
49th to 33rd spot and left behind such innovative countries as Hong
Kong, Iceland, Brazil, Turkey and others.
26. Global Innovation Index 2015
t's also interesting to note that Ukraine is currently featured
among Top 5 Countries by IT education.
27. Global Innovation Index 2015
And this year, Ukraine is also in Top 10 Countries by the
number of high-tech patents filings per 1 million population
and per $1 million of R&D spent.