Converting Science, Technology and Innovation Capacity into Business Opportunities and Moving Ideas from the Lab to the Market

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Beverly Shaw
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1 Converting Science, Technology and Innovation Capacity into Business Opportunities and Moving Ideas from the Lab to the Market Exploring Development Partnerships Between IFC and Finland-Seminar Helsinki, 13th September 2010 Dr. Hannes Toivanen VTT Technical Research Centre of Finland Tel , . 2 Innovation and Development Increasing recognition of the significance of innovation and ICT for development; Improved framework conditions for STI/ICT in the developing world New sources of global economic growth is changing innovation dynamics: The poor and emerging markets drive economic growth, not the rich; Innovation adapted to the needs of the poor Bottom-of-the-pyramid approach Inclusive innovation Emerging economies are playing growing role in global innovation networks Transfer of national or business models is of limited viability Finnish challenges Understanding emerging knowledge dynamics Strengthening (networks with) institutions of innovation in the developing world Turning Finland global Departure from old business models

2 3 Share of Global Production New Knowledge Source: ISI Web of Science 2009 / InCites GDP per capita USD Source: OECD Factbook 2010: Economic, Environmental and Social Statistics - ISBN OECD 2010 Finland Brazil India South Africa

5 Exhausting the OECD Innovation Strategy in OECD Countries Researchers per 1000 employed Finland and the West are unlikely to triple their GDP per capita over the next 30 yrs 1983 1987 1995 2000

Social Statistics - ISBN 92-64-08356-1 - OECD 2010 16,5 2 0,4 1,4 Moving up the value chain core strategy of Finnish industrial & innovation policy Focus on knowledge based innovations; Competing

3 5 Exhausting the OECD Innovation Strategy in OECD Countries Researchers per 1000 employed Finland and the West are unlikely to triple their GDP per capita over the next 30 yrs If anybody is, it is the emerging and developing economies; Finland Brazil India South Africa 3,9 4,3 8,2 15,2 1,6 0,3 15,8 1,5 1,3 Source: OECD Factbook 2010: Economic, Environmental and Social Statistics - ISBN OECD ,5 2 0,4 1,4 Moving up the value chain core strategy of Finnish industrial & innovation policy Focus on knowledge based innovations; Competing from existing markets with improved products; What is the industrial and innovation strategy that enables Finnish society to be part of the core processes of global economic growth? 6 Finnish National System of Innovation Early adopter of the National System of Innovation Framework in the 1990s: Focus on systemic coordination of innovation Policies of renewal in the 1990s: Combination of Increased public R&D spending; Organizational changes, especially the objective of bridging research and industry; R&D Spending in Finland Source: Statistics Finland / Tekes *Estimate

7 Circulation of Knowledge & Experience Distinction between funding: Peer review science funding (Academy of Finland) Expert awarded technology funding (Tekes) Networking remains one of the

policies: Finland 2020 - From thought to action.

4 7 Circulation of Knowledge & Experience Distinction between funding: Peer review science funding (Academy of Finland) Expert awarded technology funding (Tekes) Networking remains one of the central objectives of public innovation policy Regional &national (& international) Organization of Government Innovation Policy and major agencies Source: Tekes Some recent major reforms or policies: Finland From thought to action. Final report by the Growth Initiative working group New Universities Act & Aalto University (2009) National Innovation Strategy (2008) Strategic Centres for STI (2007) Continued increase of public R&D spending 8 Geographical distribution of public R&D units Source: Evaluation of the Finnish National Innovation System Policy Report

2009 10 Competence clusters Source: Evaluation of the

5 9 Centres of expertise Source: Evaluation of the Finnish National Innovation System Policy Report Competence clusters Source: Evaluation of the Finnish National Innovation System Policy Report (TEM Web pages)

11 Strategic Centres for STI within national strategy Energy and the

communication industry and services TIVIT Ltd Metal products and

Health and well-being SalWe Ltd Strategic centres for science, technology

projects Academy of Finland s Programmes Strategic research 300m e/yr

expertise programme 20 million euros yearly Experimental development

Innovation networks are very strong in Finland; Finland persistently

looking; Finnish innovation networks do not appear to extend in the

6 11 Strategic Centres for STI within national strategy 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 Strategic centres for science, technology and innovation 300 million euros yearly Research programmes Company group projects Academy of Finland s Programmes Strategic research 300m e/yr Tekes Programmes 500 million euros yearly Industrial research Centres of expertise programme 20 million euros yearly Experimental development Source: Tekes 12 Finnish Innovation Networks and the Developing World Innovation networks are very strong in Finland; Finland persistently underperforms in international aspects of innovation the system is inward looking; Finnish innovation networks do not appear to extend in the developing world; Research Co-authorship links between Africa and the World Source: Toivanen & Ponomariov 2010 / ISI Web of Science

13 Final Considerations: Matching World Laboratories and Markets Finland has plenty of technologies and capabilities with potential for emerging markets and development; Success and

world markets; Finnish innovation networks do not extend to the developing world; Innovation meeting the needs of the poor and developing countries requires deep understanding of the

7 13 Final Considerations: Matching World Laboratories and Markets Finland has plenty of technologies and capabilities with potential for emerging markets and development; Success and contribution in the emerging world is critical for sustained innovation capacity of Finland; Incumbent Finnish innovation, business or internationalization models do not fit developing world markets; Finnish innovation networks do not extend to the developing world; Innovation meeting the needs of the poor and developing countries requires deep understanding of the users; Innovation networks between Finland and the developing world are required for success; Bridges are currently emerging, but more effort is required; 14 VTT creates business from technology

FIMECC Ltd. 15.6.2010

FIMECC Ltd. 15.6.2010 FIMECC Ltd. FIMECC Ltd. is private owned company that coordinates company driven research programs in the field of mechanical engineering and metals The platform that FIMECC implements is a national publicprivate