Experience with R&D&I reforms, successful programmes in Finland

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1 Experience with R&D&I reforms, successful programmes in Finland First Anniversary Conference of the Technology Agency of the Czech Republic Dr. Jussi Kivikoski Executive director

2 Public sector activities of R&D in Finland PARLIAMENT Research and Innovation Council Ministry of Education GOVERNMENT Ministry of Employment and the Economy Other ministries and their institutes Academy of Finland Universities Tekes VTT Sitra Finnvera plc Finpro Finnish Industry Investment Ltd Regional ELY Centres DM

3 Resources in the innovation environment Private Public Academy of Finland 297 (297) From abroad 407*** VTT 245 (74) Ministries, ELY Centres, sectoral research 413 (402)* R&D at companies 4,179* Business Angels Approx. 380* Venture capitalists: Private 364 Finnish Industry Investment: direct 19, venture capital funds 131, seed funding 7 Tekes 526 (526) Innofin 7 (5) Sitra 35 Universities and polytechnics** 1,165 (482) Basic research Applied research Business R&D Finpro 35 (21) Finnvera 468 (44) Business development Marketing Internationalisation The figures represent the total extent of each organisation in million euros in 2008, those marked with star are earlier. In parenthesis the share that is funded from the State budget. **includes polytechnics *** includes R&D costs of corporations foreign units

4 Tekes key partners and stakeholders Other ministries Regional Councils MinEdu Municipalities and cities Research and Innovation Council Innofin Industry Investment Sitra Private investors and Business Angels National Board of Patents and Registration Academy of Finland Invest in Finland Associations for industry and services Finpro Finnvera ELY Centres Tekes TEM Strategic Centres Technology Centres Centres of Expertise Customers Companies Universities Research institutes Polytechnics The public and third sector DM

5 Mission statement and vision Tekes Finnish Funding Agency for Technology and Innovation Mission statement Tekes boosts the development of Finnish industry and the service sector by technological means and through innovation. This will renew the economy, increase added-value and exports, enhance productivity and the quality of working life, and create employment and wellbeing. Vision Tekes is a leader in boosting innovation. DM

6 Objectives Capabilities in innovation activities Objectives Productivity and renewal of industries A wellbeing society and environment Internationality of innovation activities Strong and networked competence centres Focus during strategy period Young innovative companies Growth companies Combining technical and non-technical development Sustainable energy economics and environment Quality social and health care service system Services and platforms for the information society Quality of working life DM and

7 Our approach Tekes complements private financiers we accept more risks than private financiers Tekes activities extend to all aspects of innovation: technology AND other areas business development, industry AND services Confidentiality Tekes does not disclose business confidential information to third parties applications are evaluated in-house companies may submit applications anytime

8 Tekes, January 1 st, 2010 Board Core Processes Strategic Management Veli-Pekka Saarnivaara Strategy Hannu Kemppainen Customerships Jari Romanainen Programmes Jussi Kivikoski Funding Ari Grönroos Management Support Competence Areas and International Network Riikka Heikinheimo Industrial Branches and Regional Network Martti Äijälä Finance and Administration Juha Sarkio DM

9 Regional Network ELY Centres Lapland (Rovaniemi) Northern Ostrobothnia (Oulu) Ostrobothnia (Vaasa) Southern Ostrobothnia (Seinäjoki) Central Finland (Jyväskylä) Pirkanmaa (Tampere) Satakunta (Pori) Southwest Finland(Turku) Kainuu (Kajaani) North Savo (Kuopio) North Karelia (Joensuu) South Savo (Mikkeli) Häme (Lahti) South-eastern Finland (Lappeenranta) Uusimaa (Helsinki) Tekes (Helsinki) Innovations and International Business Operations units at the ELY Centres offer Tekes services to companies and research organisations. DM

10 Tekes international activities Cooperation with foreign public R&D financiers to promote collaborative research and researcher mobility Services of Tekes programmes to support international research cooperation and internationalisation of innovation activities of Finnish enterprises Foresight and benchmarking laying the foundation for the strategy work of Tekes and the entire innovation environment Silicon Valley Washington Brussels Beijing Shanghai Tokyo Tekes overseas offices DM

11 Tekes promotes European cooperation Tekes is the host of the Finnish Secretariat for EU R&D. Together with the EU Commission and other member countries, Tekes co-finances several European programmes including AAL, ARTEMIS, Enterprise Europe Network and Eurostars. EUREKA is a European network that supports businesses performing close-to-market R&D. Tekes finances Finnish participants in EUREKA projects and coordinates EUREKA in Finland. COST (European Cooperation in Science and Technology) is an instrument supporting cooperation among scientists and researchers. Tekes in the national coordinator for COST in Finland. Tekes coordinates, manages and funds European Space Agency cooperation in Finland. Tekes supports the the Ministry of Employment and the Economy in implementing the national space policy. Tekes participates in steering of several R&D programmes of the Nordic Council of Ministers. DM

12 Tekes international partner network

13 International cooperation in projects funded by Tekes in 2009 Total 825 R&D projects with 54 countries Number of projects Cooperation additionally in less than 20 projects per country with 35 countries. DM , and

14 Tekes strategy in a nutshell The basis Mission statement Tekes boosts the development of Finnish industry and the service sector by technological means and through innovation. This will renew the economy, increase added-value and exports, enhance productivity and the quality of working life, and create employment and wellbeing. Values Tekes and its staff value and aim to promote the wellbeing, vision, trust, cooperation and development of society, customers and colleagues Vision Tekes is a leader in boosting innovation Core activities Core processes Strategy Foresight, evaluation and innovation research Strategy creation and communication Customerships Customership planning CR management New client acquisition, activation and customer service Marketing communication Programmes Tekes programmes Activation projects Strategic Centres for Science, Technology and Innovation International cooperation initiatives Funding Special innovation funding Funding for public research R&D funding for companies Resources million euros Personnel overseas offices The goal Objectives Capabilities in innovation activities Focus during strategy period: Internationality of innovation activities Strong and networked competence centres Productivity and renewal of industries Focus during strategy period: Young innovative companies Growth companies Combining technical and non-technical development A wellbeing society and environment Focus during strategy period: Sustainable energy economics and environment Quality social and health care service system Services and platforms for the information society Quality of working life DM

15 Tekes R&D funding in the state budget Million euros Funding for R&D and innovation R&D grants for companies and public research funding were combined in Funding from EU s Structural Funds come from outside of Tekes budget. DM

16 Tekes R&D funding in 2009 Total 579 million euros and 2,177 projects R&D grants to companies and public organisations 246 million euros Research funding for universities, research institutes and polytechnics 236 million euros R&D Loans to companies 97 million euros Figures include 12 million euros from the Workplace Development Programme TYKES and 22 million euros funding from EU Structural Funds. DM and

17 Tekes R&D funding to companies in 2009 by size of company Total 331 million euros and 1,093 companies Funding, million euros Number of projects 6 43 Micro companies Small companies Midsized companies Large companies Federations, etc percent of the funding for business R&D was directed towards SMEs and 82 percent towards companies with less than 500 employees. In addition Tekes funded workplace development through the TYKESprogramme with 12 million euros DM

18 Focus of Tekes funding in 2009 Tekes funding for the service sector Tekes funding for energy and environment targets Tekes funding for applications and utilisation of ICT Tekes funding for the wellbeing and health theme Tekes funding for non-technical development (the business and service concepts, branding, practices, management and organising of work, design, consumer behaviour...) 165 mill. euros 238 mill. euros 212 mill. euros 53 mill. euros 234 mill. euros 50 % of the funding for companies 41 % of the funding 37 % of the funding 9 % of the funding 41 % of the funding DM

19 Tekes strategy focus areas DM

20 Focus areas in Tekes strategy Global drivers and trends Challenges for the economy and society Themes Crosscutting competences Practices Choices building industry and society DM

21 Themes and practices Global value networks Renewing innovation Clean energy Built environment Wellbeing and health Service business and service innovation Scarce resources Intelligent systems and environments Public-private partnership Knowledge society for all Interactive media Foresight of customer needs ICT as an enabler DM

22 Tekes strategy focus areas - draft Business concepts and leadership in global networks Value added by solution based services and intangible contents Renewal of services and production by digitality Changing Living Environment Natural Resouces and Healthy Economy Vital Life Our strong industries ICT, Metal, Forest, Energy, Built environment, Health and well-being DM

23 National Innovation Strategy

24 Tekes programmes forums for networking in sectors of the future DM

25 What are Tekes programmes? Tekes programmes are complete packages of financing and expert services, aimed at the most important targets in terms of the future of Finnish business and society Tekes finances research and development projects aimed at specified areas and provides programme services that support a programme s objectives about half of the financing granted by Tekes is channelled through Tekes programmes DM

26 Process for Tekes programmes

27 Programmes are Tekes choices for the greatest impact of R&D funding In 2009, 43% of the funding granted by Tekes was channelled via the programmes. The rest of Tekes funding is granted to projects that are outside the programmes. The focus areas of these projects are not generally restricted 43 % 57 % DM

28 What do Tekes programmes offer companies and research organisations? The benefit for programme participants is more than just the funding of a single project. The programmes offer financing for research and development projects in line with the programme s objectives; programme services that promote the participants networking international operations business competence development research results being transferred to SMEs a community where competitors can also come face-to-face as partners; opportunities for obtaining publicity for the results of the projects carried out in a programme DM

29 Regional networking with partners from Turku in electronics and Miratel Oy (Turku) telecommunications programmes Nokia Multimedia Terminals (Turku) Finnish Broadcasting Company (Helsinki) Elisa Communications (Helsinki) Sonera (Helsinki) Nokia Research Center (Helsinki) University of Oulu (Oulu) Helsinki University of Technology (Espoo) Tampere University of Technology (Tampere) VTT (Helsinki) Satel Oy (Salo) Teleste (Turku) Nokia Networks (Tampere) ADC Telecommunications Oy (Oulu) Nokia Mobile Phones (Tampere) Filtronic LK Oy (Oulu) Mariachi Oy (Turku) ABB (Helsinki) VTT (Oulu) Includes partners who participated in at least three projects in Tekes Electronics and Telecommunications technology programmes. Wallac Oy (Turku) Copyright DM Tekes and

30 BioRefine New Biomass Products Programme duration: Programme volume: 137 million euros Further information: DM

31 Boat Building Programme Programme duration: Programme volume: 25 million euros, of which Tekes share is 15 million euros Further information: DM

32 ClimBus - Business Opportunities in Mitigating Climate Change Creating new business in the global market of climate technologies and services. Programme duration: Programme volume: approx. 89 million euros, of which Tekes provides 42.7 million euros Further information: DM

33 Strategic centres for science, technology and innovation (SHOK) DM

34 Strategic Centres for Science, Technology and Innovation Strategic Centres for Science, Technology and Innovation will provide a new way of coordinating dispersed research resources to meet targets that are important for Finnish business and society. The strategic centres are virtual organisations with a strong management company (Limited) The shareholders of the management company are private companies, universities, research institutes Companies, universities and research institutes will agree on a joint research plan. The plan will aim to meet the application needs for practical application by companies within a 5-10-year period. In addition to the shareholders, public funding organisations will commit themselves to providing funding for the centres in the long term. DM

35 Six strategic centres Energy and the environment CLEEN Ltd Forest cluster Forestcluster Ltd Information and communication industry and services TIVIT Ltd Metal products and mechanical engineering FIMECC Ltd Built environment innovations RYM Ltd Health and well-being SalWe Ltd DM

36 Impact Analysis of Tekes DM

37 Innovations are profitable investments for the future Tekes objectives A wellbeing society and environment Productivity and renewal of industries Capabilities in innovation activities Productivity and renewal Impact Environment Activities R&D and innovation activities Education New methods and networking Input Investment in intangible and tangible capital Existing knowledge, information and know-how Knowledge, Wellbeing education and culture Output Innovations: products and Growth of firms and services, processes, internationalization organization and methods Productivity New firms, business areas and Utilization and spillovers of services new knowledge and knowhow DM

38 New economic growth model sources of economic growth Labour Technical and non-technical innovations Immaterial capital Creative individuals and communities Market orientation Economic growth Education Research Technology Know-how Knowledge Innovation Growth in productivity Increase in exports Improvement in employment Regional development Growth in well-being Capital Customer and user orientation Pioneering markets Open innovations According to the new growth model, economic growth is rooted in education, research and technology. DM

39 Innovations are profitable investments for the future Tekes objectives A wellbeing society and environment Productivity and renewal of industries Output Innovations: products and Growth of firms and services, processes, internationalization organization and methods Productivity New firms, business areas and Utilization and spillovers of services new knowledge and knowhow Capabilities in innovation activities DM

40 Output additionality Public R&D funding of companies Results Direct effects Company R&D investments Publications Patents Prototypes Business plans New products, processes and services Turnover Value added Personnel Productivity Export Output additionality Output additionality Output additionality DM

41 Innovations are profitable investments for the future Tekes objectives A wellbeing society and environment Productivity and renewal of industries Activities R&D and innovation activities Education New methods and networking Capabilities in innovation activities DM

42 SMEs participating in innovation cooperation in 2006 % Source: European Innovation Scoreboard 2008 DM 36054, and

43 Innovation cooperation between companies, universities and research institutes Share of innovating companies , percent FINLAND Slovenia Sweden Norway Hungary Denmark Czechia Belgiun Netherlands Great Britain Austria France Ireland Estonia EU 27 Portugal Germany Poland Iceland Spain Universities Research institutes Source: Eurostat, Community Innovation Survey (CIS4), 2007 %

44 Impacts of funding from Tekes on project implementation Projects ended in % Source: Tekes customer surveys DM ja

45 Innovations are profitable investments for the future Tekes objectives A wellbeing society and environment Productivity and renewal of industries Capabilities in innovation activities Input Investment in intangible and tangible capital Existing knowledge, information and know-how DM

46 Input additionality Public R&D funding Public R&D funding Company s original R&D investment Company s original R&D investment Input additionality Input additionality means that the company invests more in R&D than it would without public funding. DM

47 Impacts of R&D funding Tekes s clients have experienced more rapid growth than companies in the business register in general. Business Aid Database Creation: Final Report by the Working Group (2006) R&D funding increases the growth, activeness in seeking patents and demand for labour of companies and reduces the likelihood of business closures and mergers. Hovi et al. (2006) R&D funding has increased the growth of productivity and improved employment in companies with a well compensated R&D. Piekkola (2006) Nearly two in three companies perceived Tekes funding to have helped the company increase its net sales. Pekkanen et al. (2004) DM

48 How much does one euro of public R&D funding increase companies own R&D investments? According to research results, one euro of public R&D funding increases private R&D investments by euros. In other words, the overall additionality of public R&D funding is euros. 1 euro adds 1.02 euro Ali-Yrkkö 2008 (Finland) 1 euro adds 0.93 euro (Commission staff working document, European Competitiveness Report 2004) (Finland, Germany) 1 euro adds euro Ali-Yrkkö 2004 (Finland) 1 euro adds 0.40 euro Streicher et al (Austria) 1 euro adds 0.70 euro Guelle & van Pottelsberghe 2003 (OECD countries) 1 euro adds 0.41 euro Lach 2000 (Israel) 1 of tax alleviation adds euro Poot et al 2005 (Netherlands) DM

49 Thank you Information about Finnish innovation environment, Tekes's activities interesting publications and research and development projects Subscribe to Tekes Newsletter at DM

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