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seminar for MOSTI MSc. service innovation module, on polcy implications - and initiatives like SSME - of the novel features of service innovation.
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Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Service Innovation Policy (and beyond)
Ian Miles
MOSTI service innovation seminar 9
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Contents
Lobbying Policymakers and EducatorsSSME, SRII, etc
Why?Why Innovation Policy?
Why innovation policy for services?
What?What policy instruments?
Who can design and implement these? What do we know? Who is doing what?
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Major Industry “Buzz!
Especially IT industry promoting notion of service science
Other important action around service quality and service marketing – rise of SDL
http://www.sdlogic.net/
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
and Service Engineering
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
IBM - SSME
At:; http://www-304.ibm.com/jct01005c/university/scholars/skills/ssme/index.html
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Service Research and Innovation Initiative
At:; http://forums.thesrii.org/srii
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Industry impacts on policy
Policymakers respond to industrial concerns
Plus, much of public sector is about services, and in these sectors there are many innovation initiatives (though these may be labelled efficiency, modernisation, or otherwise)
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009 http://www.institute.nhs.uk/
Example – NHS innovation
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
General arguments for innovation policy
Should apply to services, if these are not discounted as non-innovative (which does seem to have been the case historically)Market failure, system failureImportant for competitiveness, both directly and as business services supporting business in generalImportant for QOL, esp. non-market services
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Specific service innovation policy?
We know that some features of service innovation are distinctive – e.g. R&D less common
Are services worse integrated into innovation systems?
Are services overlooked in policy programme formulation and implementation?
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Some reviews and explication of arguments:
EC Expert group Fostering Innovation in Services and various commentaries
Louis Rubalcaba papers, eg “Which policy for innovation in services?” Science and Public Policy 2006
RISE project
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Policy Rationales
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Policy Areas (Kuusisto, 2008)
Supply-side, demand-side, bridging policies; source: http://www.servicesaustralia.org.au/pdfFilesResearch/TowardsHighPePolicy.pdf
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
R&D and services
Smaller firms: generally do less R&D.
Even accounting for this, most services report lower R&D than most equivalent manufacturers
Most R&D programmes not service-targeted
But still, incentives via tax credits for R&D. etc.?
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
The Official UK R&D Survey
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Small printDefinition of Research and Development
R&D is a difficult concept to measure. We have attempted below to provide some basic guidelines to follow. In some cases you may need to apply an element of judgement when compiling your figures. We accept approximations. R&D is defined as “Creative work undertaken on a systematic basis in order to increase the stock of knowledge, including the knowledge of man, culture and society, and the use of this stock of knowledge to devise new applications”.The guiding line to distinguish research and development activity (R&D) from non-research activity is the presence or absence of an appreciable element of novelty or innovation. If the activity departs from routine and breaks new ground it should be included; if it follows an established pattern it should be excluded. The guidance in this note is based on the internationally agreed standard established by the OECD and published in what is known as the “Frascati” manual. A summary of the latest edition is available from the ONS.Exclude such activities as:a.Routine testing and analysis of all kinds, whether for control of materials, components or products, and whether for control of quantity or quality. (Testing and analysis as part of an R&D programme should be included.)b. Market research, operational research, work study, cost analysis, management science, surveying, “trouble-shooting”.c. Royalties payments for the use of the results of research and development unless required as an essential part of the research and development programme within the unit.d. Trial production runs where the primary objective is not further improvement of the product.e. Design costs to meet changes of fashion and artistic design work.f. Legal and administrative work in connection with patent applications, records and litigation; work involved in the sale of patents and licensing arrangements; experimental work performed solely for the purpose of patent litigation.
Other steers in definitions of employment: prof S&T, technicians…
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Knowing How, Knowing Whom: A Study of the Links
between the Knowledge Intensive Services Sector and The Science Base
IoIR report to Council for Science and
TechnologyJune 2003
http://www.cst.gov.uk/cst/reports/files/knowledge-intensive-services/services-study.pdf
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Sources of Information
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
(TS-A
E)
(TS-R
D)
(IT-C
S)
(IT-T
O)
(FS-B
I)
(FS-R
L)
(PS-L
A)
(PS-I)
(PS-M
)
(TS-P
)
(TS-F
)
(TS-O
)(W
S)HTM
MHTM
MLT
MLT
M
PublicUsed
PublicHighImptPrivateUsed
PrivateHighImpt
Most services less prone to use Universities, government
Many services more prone to use private sources of inf – esp consultants.
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Technical services - high levels of collaboration
• Collaboration with Universities uncommon - throughout industry;
•most contact with manufacturing in general;
•5% services, 9% manufacturers;
• But evidence that dynamic innovators collaborate more.
Collaboration
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Interviews with KIS Firms
Environmental Services
Business Continuity Services
Long-term Personal Insurance
Market Research / Marketing
- Innovation important, rarely formalised
- Different sorts of knowledge required for business practice and innovation
- Huge differences small/large firms
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Human ResourcesMuch variation, but most frequent account is that graduates are valued as source of general skills, specialist skills are sometimes but not often sought
Large firms more likely to be strategic in recruitment
Some KIS have elaborate professional development systems
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Information, Expertise and Collaboration
Small firms have few links in generalLinkages often ad hocSearch for right sort of peopleCollaboration rare, some prominent exceptionsLittle awareness of support for collaborative researchImportant sectoral differences in assessment of knowledge base
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Supply SideRarely any specific strategies for KIS, some are recognised as having high potential. Scope for more development.
Variations across Universities and KIS
Important role of Centres and Programmes
Some apparent linkages are not used for knowledge transfer
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
OverallLack of “absorptive capacity” on both sides
Centres of excellence and other intermediaries provide compass points, accumulated knowledge, know-who, “translation” capabilities
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
PolicyBetter measurement (sampling, surveys) - not to reach targets faster but to inform policy
Better targeting of “mainstream” R&D and innovation programmes to engage services
beyond the usual suspects
some re-engineering of innovation systems
awareness and promotion (incl. some benchmarking with service examples, etc.)
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
PolicyBetter measurement - not to reach targets faster but to inform policy
Better targeting of “mainstream” R&D and innovation programmes to engage services
Services-oriented R&D and innovation programmes from science and industrial policy angles (draw on examples of good practice)
relate to ongoing initiatives where useful
support for new generations of innovation management
...
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Interventions may promote change:
Generally services neglected in innovation and R&D policy - but there is now some R&D policy for services and R&D-relevant initiativesInitiatives like IBM’s “service science”, NSF “service engineering”
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Some overviews
SIID, and more recently IPPS
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Many countries active:Some have established service innovation (Finland), R&D (Germany, Canada), engineering (USA) programmes U.S. Congress - National Innovation Act - add “Fostering the Field of Service Science” to studies conducted by the National Science Foundation Some countries have instigated projects to explore prospects (UK, Eire)Also international bodies (EC) – the EU has identified service and non-technological innovation as one of nine strategic priorities of its innovation strategy; funding programs to create a policy framework and establish knowledge platformsJapan’s “New Economic Growth Strategy” - six key service areas for service policy initiatives – funding for advanced business models in health and welfare, childcare, tourism, business support services and distribution services.Much interest – action very patchySome more detail…
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Finland - TEKES euro100m over 5y;’ TEKES pays 50%
Mainly B2B
IPPS funded from this to explore policies
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
R&D Policy Initiatives – e.g. BMBF
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
German Initiatives - BMBF
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
German Initiatives - BMBF
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
German Initiatives - BMBF
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
Changing Innovation Policy?
Kuusisto 2008
Manchester Institute of Innovation Research
MOSTI - Service Innovation 2009
End of Presentation