Finland s National Innovation Strategy - Framework and Key Directions

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1 Finland s National Innovation Strategy - Framework and Key Directions Petri Peltonen Director General Innovation Department Ministry of Employment and the Economy

2 Scientific publications The World is Flat The World is Spiky. Patents Source: Tim Gulden, UMD, Richard Florida, U of T, Pekka Himanen, HIIT

3 Dynamic Challenges of Finland Transformation of firm strategies Off-shoring of manufacturing industries Shift from integrated manufacturing system to globally distributed. value networks Increased importance of alliances and partnerships Competition converges on services instead of products New innovation models From closed to open innovation Globally networked innovation processes Growing importance of service innovation and delivery Pronounced role of users and customers for successful. innovation delivery

4 Systemic Challenges of Finland Innovation activities in Finland highly concentrated over 50% of business R&D in ICT-industry 70% of business R&D in firms with >500 employees less than 2300 firms actively do research 50% of industrial and 63% of service firms do not do research Internationalization of the Finnish innovation system is relatively low Foreign venture capital is low in international comparison Foreign R&D is low in international comparison Large public sector and scattered structures Horizontal governance of innovation policy is underdeveloped No horizontal coordination of innovation policy implementation No comprehensive innovation strategy for the public sector

5 Innovation strategy Steering group Esko Aho, chairman, Sitra Petri Peltonen, TEM Sakari Karjalainen, OPM Pirjo Harjunen-Rosenholm, TEM Juha Teperi, STM Riikka Heikinheimo, Tekes Anne Stenros, Kone Oyj Erkki Ormala, Nokia Group Oyj Kaija Pöysti, Blue-White Ventures Anne Brunila, Metsäteollisuus ry Timo Kekkonen, EK Pekka Neittaanmäki, JY Jarl-Thure Eriksson, TTY Merja Strengell, TEK 5

6 Commercially In society In well-being Innovation = Exploited Competence-Based Competitive Advantage New knowledge, know-how, technology New product, technical solution, production process New (expert) service New design or brand New business model, value-chain, value-network New organisational, management or working life model New way of providing a public service 6

7 Innovation policy framework Science Technology Competition Incentives R&D Innovation DUI Market demand Users Industries & clusters New & growing firms Public Services DUI = Doing Using Interacting 7

8 Innovation policy framework Science Technology Competition Incentives R&D Innovation DUI Demand-based Innovation policy Demand pull Market demand Users Knowledge-based Innovation Industries policy & clusters Knowledge push New & growing firms Public Services DUI = Doing Using Interacting 8

9 Innovation policy framework Opennes Creativity Diversity Science Technology Education Learning Skills Networks Partnerships Industries & clusters Competition Incentives R&D Innovation DUI Services & Products Competitiveness, Productivity, Renewal New & growing firms Business concepts Design & brands Work life Public Services Entrepreneurship Market demand Users Experiences Quality of life 9

10 Existing Standars Norms Users tax incentives New / missing Demand-based innovation policy EU ERC EU FP7 Tekes programs VC tax incentives Innovation University Innovative public services TYKES Lead markets Demand pull Green Procurement Public procurement Pre-comp procurem. (R&D) SA Centers of Expert. SA programs SHOK EU JTI TEM Investment Tekes aid programs Competence-based Innovation policy Knowledge push EU EIT OSKE KYservice Yritys- Suomi EAKR ESR Tekes programs YIC funding Living labs User communities Sourcing know-how Conceptual draft, to be developed

11 Global Innovation Environments (S&T, R&D, OI, DUI) Global Innovation-Based Business European Research and Innovation Area (ERA) Internationally Attractive Finnish Innovation Environment 11

12 Innovation strategy - Some key directions 1. Service, business model, design/brand, organisational and work-life innovations to be raised to the center point of innovation promotion, at par with science and technology 2. User-centric innovation (DUI) to be made a new innovation policy dimension and Finland s future competitive advantage 3. Number of innovative firms to be two-folded to by Strongest incentive for innovation are competition and new business opportunities. Competition policy and public regulation to be utilised also as innovation policy instruments and innovation drivers. 5. New markets for innovative service solutions should be created especially in the public sector. 6. Global opening and increasing competition necessitates stronger national knowledge hubs, more open innovation concepts and stronger in- and outward internationalisation 7. Number of new growth firms to be three-folded by

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