“Did we lost the market out of perspective while promoting innovation systems?”

In quite not few of the presentations and inputs during the Conference there is no word mentioned about the challenges of businesses to stay or  become more competititive. A lot has been said about policies and strategies on innovations, concepts, research projects and the new design of funding programmes at the EU-, national and regional levels.  If we brainstorm e.g. in workshops on main criteria of sustainable competitiveness only 2 from 35 answers are related to markets. One might get the impression that we feel quite comfortable when clustering ourselves together to reflect about innovation while loosing the aspect of competitiveness out of sight.

This should be a provocative statement and also understood accordingly. Nonetheless, my impression is that the more we talk about radical, incremental, process, product and system innovation it seems that we loose sight of the market. Although technology-push activities are necessary in some aspects, the pull elements are nearly not mentioned anymore in this Conference. Some years ago we very much

• discussed the logics of regional economic development and the driving importance of demand conditions (see e.g.Porters diamond),
• and wanted to understand and promote the national (or global) value chain systems and its business relations between suppliers, producers, big buyers and SMEs  and customers (see e.g. Porters five forces).

It seems to me that while focusing on the discussion of innovation and R&D promotion, the market falled off the agenda somewhere in between the whole complexity. This is quite contrary to the findings of international studies. Let´s just mention 2 main findings from the European Commission  and UNCTAD reports. The presentation of Mette Quinn (see workshop 4 on Wednesday) on creative industries and service clusters in Sweden points out that most of the innovation emerges inside businesses due to their intensive learning processes from customers as well as from creative ideas of their own employees.

This is a valueable insight for the service sector of a very industrialized country. If you look at the latest UNCTAD LDC technology report you see that most of the innovation learning processesof  SMEs in less developed countries also come from their customers, suppliers as well as other producers.

R&D in industrialized as well as developing countries play still a very very marginal role in the promotion of innovation. Maybe there are trickle-down effects. For sure they are somewhere. Nonetheless:, isn´t it time to consider these real innovation realities more intensively, approaching the analysis of innovation systems again much more from the business perspective.

Michael Enright said in a workshop session: “85% of real innovations are coming from businesses and are demand-driven. 99% of the innovation promotion programmes are focusing on technology-push approaches.”

This is an astonishing imbalance, is it not?

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