Transcript Design driven innovation

Design driven innovation:
Current measurement practice and
recommendation for future innovation surveys
Hugo Hollanders
UNU-MERIT (Maastricht University)
[email protected]
Stefano Tarantola
Joint Research Centre of the European Commission
[email protected]
SEE Thematic Workshop “Evaluating design and innovation policies”
Florence, 10 and 11 May 2010
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Importance of innovation
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The Lisbon Strategy aimed to "make Europe, by 2010, the
most competitive and the most dynamic knowledge-based
economy in the world“ and emphasized the importance of
innovation for improving Europe’s competitiveness
The new EUROPE 2020 Strategy for smart, sustainable and
inclusive growth has singled out innovation as one of the
key drivers that can get Europe out of the current crisis and
also prepare its economy for the next decade
The European Innovation Scoreboard has been the main
tool developed at the initiative of the European Commission,
under the Lisbon Strategy, to provide a comparative
assessment of the innovation performance of EU
Member States
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What is the European Innovation Scoreboard (EIS)?
ENABLERS
Human resources
S&E and SSH graduates per 1000 population aged 20-29 (first stage of tertiary education)
S&E and SSH doctorate graduates per 1000 population aged 25-34 (second stage of tertiary education)
Population with tertiary education per 100 population aged 25-64
Participation in life-long learning per 100 population aged 25-64
Youth education attainment level
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Enablers
Finance and support
Firm activity
Public R&D expenditures (% of GDP)
Venture capital (% of GDP)
Private credit (relative to GDP)
Broadband access by firms (% of firms)
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Outputs
FIRM ACTIVITIES
Firm investments
Business R&D expenditures (% of GDP)
IT expenditures (% of GDP)
Non-R&D innovation expenditures (% of turnover)
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Linkages & entrepreneurship
SMEs innovating in-house (% of SMEs)
Innovative SMEs collaborating with others (% of SMEs)
Firm renewal (SME entries plus exits) (% of SMEs)
Public-private co-publications per million population
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Throughputs
EPO patents per million population
Community trademarks per million population
Community designs per million population
Technology Balance of Payments flows (% of GDP)
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The EIS is an annual benchmark of innovation performance
across EU27. It tries to capture the capacity of Member
States to generate innovative goods and services by
looking at 29 innovation-related indicators categorised
in three groups: Enablers, Firm activities and Outputs
OUTPUTS
Innovators
SMEs introducing product or process innovations (% of SMEs)
SMEs introducing marketing or organisational innovations (% of SMEs)
Resource efficiency innovators, calculated as the average of:
Share of innovators where innovation has significantly reduced labour costs (% of firms)
Share of innovators where innovation has significantly reduced the use of materials and energy (% of firms)
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Only publicly available data is used, for the most recent
year, in most cases 2008
Economic effects
Employment in medium-high & high-tech manufacturing (% of workforce)
Employment in knowledge-intensive services (% of workforce)Medium and high-tech manufacturing exports (% of total exports)
Knowledge-intensive services exports (% of total services exports)
New-to-market sales (% of turnover)
New-to-firm sales (% of turnover)
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European Innovation Scoreboard – Approach
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No theoretical model of innovation
Choice of indicators
 Small set of indicators (29)
 Balance across different aspects
 Only indicators which are available for EU27
 Robust, time-series
Analysis
 Maximise policy relevance
 Summary headline indicator (one number)
 Summary Innovation Index
 Analysis by country groups, dynamics, country profiles
 Exploratory thematic analysis
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European Innovation Scoreboard – Methodology
DIMENSIONS
BLOCKS
Human resource
Finance and support
Enablers
Firm investments
Linkages &
entrepreneurship
Firm activities
Summary
Innovation
Index
Throughputs
Innovators
Economic effects
Outputs
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EIS indicators (1) – Enablers
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Human resources measures the availability of high-skilled and
educated people
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S&E and SSH graduates
S&E and SSH doctorate graduates
Population with tertiary education
Participation in life-long learning
Youth education attainment level
Finance and support measure the availability of finance for
innovation projects and the support of governments for
innovation activities
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Public R&D expenditures
Venture capital
Private credit
Broadband access by firms
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EIS indicators (2) – Firm activities
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Firm investments covers a range of different investments
needed to generate new products or processes as well as for
introducing “softer” marketing and organisational innovations
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Linkages & entrepreneurship captures the entrepreneurial
efforts and the related collaboration efforts among innovating
firms and also with the public sector
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Business R&D expenditures
IT expenditures
Non-R&D innovation expenditures
SMEs innovating in-house
Innovative SMEs collaborating with others
Firm renewal
Public-private co-publications
Throughputs captures the IPR generated as a throughput in
the innovation process and TBP flows
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EPO patents
Community trademarks
Community designs
Technology Balance of Payments flow
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EIS indicators (3) – Outputs
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Innovators captures the success of innovation by the number
of firms that have introduced innovations onto the market or
within their organisations. It covers both technological and nontechnological innovations
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Technological (product/service/process) innovators
Non-technological (marketing/organisational) innovators
Resource efficiency innovators
Economic effects captures the economic success of innovation
in employment, exports and sales due to innovation activities
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Employment in medium-high & high-tech manufacturing
Employment in knowledge-intensive services
Medium and high-tech exports
Knowledge-intensive services exports
New-to-market sales
New-to-firm sales
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Innovation performance and convergence trends in
innovation in the EU27 and other countries
EU27 average growth
rate in 2005-09
0.750
Innovation performance (SII 2009)
0.700
0.650
SE
FI
0.600
0.550
Denmark, Finland, Germany, Sweden,
UK
CH
Innovation leaders
Austria, Belgium, Cyprus, Estonia,
France, Iceland, Ireland,
Luxembourg, Netherlands, Slovenia
DE
UK
DK
AT
LU
0.500
FR
BE
IE
NL
Innovation followers
EE
IS
CY
EU27 innovation
performance in 2009
SI
0.450
CZ
0.400
NO
0.350
Moderate innovators
IT
HU
0.300
HR
PL
GR
MT
SK
LT
RO
LV
0.250
TR
BG
Bulgaria, Croatia, Latvia, Romania,
Serbia, Turkey
Catching up
0.200
0.150
0.0%
Czech Republic, Greece, Hungary,
Italy, Lithuania, Malta, Norway,
Poland, Portugal, Slovakia, Spain
PT
ES
1.0%
2.0%
3.0%
4.0%
5.0%
6.0%
7.0%
8.0%
9.0%
Average annual growth in innovation performance
Note : colour coding matches the groups of countries: green are the Innovation leaders, yellow are the Innovation
followers, orange are the Moderate innovators, blue are the Catching-up countries. Average annual growth rates as
calculated over a five-year period. The dotted lines show EU27 performance and growth.
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Role of design in the innovation process
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“Creativity is defined … as the production of new ideas that are
fit for a particular business purpose” (DTI, 2005)
“’Design is what links creativity and innovation. It shapes ideas
to become practical and attractive propositions for users or
customers. Design may be described as creativity deployed to a
specific end” (Cox Review, 2005)
Creativity generates new ideas, design shapes ideas and
innovation exploits ideas
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Interactive model of innovation
INTERACTIVE MODEL
LINEAR MODEL
R&D
Innovation
Productivity
Design
Creativity
Business
performance
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EIS Thematic paper on measuring creativity, design
and innovation
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Exploratory
Groups indicators by creative climate, creativity and design, and
innovation
What we did not try to do:
 Is to measure creativity and design directly due to a lack of
appropriate data
What we did do:
 Is measure creativity and design indirectly
 By using proxy indicators
 To measure creativity and design at the country level, not at
the individual level
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Correlation results
ENABLERS
FIRM ACTIVITIES
Human Finance and
Firm
resources
support investments
DESIGN
ACTIVITIES
Importance of design
staff for innovation
Number of designers
Community design
applications
Production process
sophistication
Uniqueness of
product design
COMPETITIVENESS
IN DESIGN
Exports design
related services
Exports product
design
0.515
0.743
0.400
0.613
0.489
OUTPUTS
Linkages &
entrepreneurship
Throughputs
Innovators
0.663
0.900
0.455
0.562
0.638
Summary
Economic
Innovation
effects
Index
0.486
0.836
0.566
0.574
0.451
0.530
0.848
0.396
0.469
0.695
0.745
0.643
0.740
0.833
0.451
0.592
0.899
0.686
0.572
0.601
0.759
0.404
0.560
0.729
0.567
0.461
0.542
0.521
0.397
0.620
0.415
0.461
0.476
0.401
0.397
0.545
– 0.425
– 0.365
– 0.442
– 0.449
– 0.437
Value chain breadth
0.600
0.705
0.566
0.654
0.782
0.374
0.539
0.825
Extent of branding
0.587
0.671
0.567
0.635
0.754
0.335
0.548
0.803
0.590
0.468
– 0.523
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Creativity and design drive innovation
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Creativity and design are (strongly) related with innovation
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Design activities correlate well with the EIS innovation dimensions,
except for the indicator on the importance of design staff for
innovation. Although more designers, more design applications, a
more sophisticated production process and a more unique product
design seem to have a positive effect on the degree of
innovativeness, the relative importance of design staff decreases
with countries’ increasing innovation performance
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The indicators measuring Competitiveness in design correlate well
with the EIS innovation dimensions, in particular the Value chain
breadth and the Extent of branding. However, exports of product
design correlate negatively with five innovation dimensions
Weakness of approach: use of proxy indicators due to a lack of
indicators directly measuring creativity and design
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Innobarometer: Importance of design staff for
innovation
Sources of innovation (EU27)
Your company's production engineers or
technicians
40
Your company's marketing department
39
Your company's design staff
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76
Your company's management
Your company's research department
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Q7. In the last two years, have any of the following been a major source of ideas
for the innovative activities of your company?
Base: those who performed any innovative activities in the last two years
% of ”Yes”
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Innobarometer: Importance of design for innovation
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Results from UK innovation survey
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Bruce S. Tether (2009), “Design in Innovation, Coming out from
the Shadow of R&D”, DIUS Research Report 09-12
 “[D]esign is a complementary asset to R&D and marketing in
the innovation activities of firms”
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“About a quarter of the innovation active firms in the UK … had
engaged in design”
“About 40% of … ‘novel innovators’ had engaged in design”
“Firms that engaged in combinations of R&D, marketing and/or
design were much more likely … to introduce product and/or
process innovations”
“The median firm … spent … an average of 5% … on design, a
proportion considerably lower than that spent on R&D (Intramural R&D = 18%; acquired R&D = 3%), on marketing (12%)
on training (15%) or on acquired machinery, equipment or
software (44%)”
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Current practice of measuring innovation:
Community Innovation Survey (CIS)
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The CIS is a survey on innovation activity in European
enterprises
The CIS is designed to obtain information on innovation
activities within enterprises, as well as various aspects of the
process such as the effects of innovation, sources of information
used, costs etc.
The CIS is based on the Oslo Manual – 3rd edition from 2005 which gives methodological guidelines and defines the
innovation concept
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Structure of CIS questionnaire
I. Questions to determine if a firm is an innovator:
 Product innovation
 Process innovation
II. If the firm is an innovator (has answered ‘yes’ to at least of the
questions under I.) then it has to answer questions on:
 Different types of innovation activities and expenditures for
process and product innovations
 Innovation objectives
III. To be answered by all firms:
 Organisational innovation
 Marketing innovation
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Design in the Oslo Manual
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The CIS does not distinguish design from R&D or marketing
activities:
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“All design activities for the development and
implementation of product innovations (including work on
form and appearance) and of process innovations should be
included either in R&D or in Other preparations for product
and process innovations”
“Work related to changes in product design that are
marketing innovations (and not product innovations, i.e.
where the functional characteristics or intended uses of the
product in question are not significantly improved) should be
included in Preparations for marketing innovations”
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Measuring design activities: discussion of recent
developments
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“When developing the CIS 2008, design was in the discussions
but in the end dropped from the final version of the
questionnaire”
Renewed discussions in 2009 to include questions on design in
the 2010 CIS
Which questions to include?
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UK innovation survey: questions on design
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Company spending on design - Exploratory survey of
UK firms 2008: recommended questions on design
Presentation by Dr. James Moultrie for CIS Task Force meeting 23/10/09
Q6
During the period 200X to 200X, did this business
engage in any of the following forms of design activity to
support innovation?
a.
Y
N
Technical design activity in the creation of new
products and services
This might include the design of mechanical, electronic or software based
items in physical goods, or the design of technology to enable services
such as IT systems. This should not include scientific research.
b.
User focused design activity in the creation of new
products and services
This might include the design of the appearance, interface and
ergonomics of physical products or software systems, or the design of the
physical materials necessary to deliver a service not based on technology,
including printed materials, user interfaces and documentation.
c.
Promotional, communication, branding and identity
design in the commercialisation of products, services
and the firm
This might include the design of all promotional materials, advertisements,
brochures, showrooms, exhibition stands, retail environments and point of
sale materials. It also might include the design of logos, corporate identity,
uniforms and business websites.
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Company spending on design - Exploratory survey of
UK firms 2008: recommended questions on design
Presentation by Dr. James Moultrie for CIS Task Force meeting 23/10/09
Q7
For each of the design related activities in question 6,
please ESTIMATE the amount of expenditure for the
year 200X. Where precise figures are not available,
best estimates are acceptable.
a.
Technical design activity in the creation of new
products and services ……………………………...
Include: cost of staff employed (e.g. mechanical engineers, electronic
engineers, software engineers), cost of bought in design services from
professional agencies.
Exclude: cost of scientific research (part of R&D expenditure) and
capital expenditure
b.
User focused design activity in the creation of new
products and services ……………………………....
Include: cost of staff employed (e.g. industrial designers, interface
designers, experience designers), cost of bought in design services
from professional agencies
Exclude: capital expenditure
c.
Promotional, communication, branding and
identity design in the commercialisation of
products, services and the firm …………………….
Include: cost of staff employed (e.g. graphic designers, branding
designers, identity designers), cost of bought in design services from
professional agencies
Exclude: capital expenditure
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Conclusions
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Design is important for innovation
Innovation is well measured in the Community Innovation
Survey
Design however is not well captured in the CIS
More detailed questions on design are needed in future versions
of the CIS
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