Innovation Economics, Engineering and Management Handbook 1 E-Book
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- Herausgeber: John Wiley & Sons
- Kategorie: Fachliteratur
- Sprache: Englisch
Innovation, in economic activity, in managerial concepts and in engineering design, results from creative activities, entrepreneurial strategies and the business climate. Innovation leads to technological, organizational and commercial changes, due to the relationships between enterprises, public institutions and civil society organizations. These innovation networks create new knowledge and contribute to the dissemination of new socio-economic and technological models, through new production and marketing methods.
Innovation Economics, Engineering and Management Handbook 1 is the first of the two volumes that comprise this book. The main objectives across both volumes are to study the innovation processes in today�s information and knowledge society; to analyze how links between research and business have intensified; and to discuss the methods by which innovation emerges and is managed by firms, not only from a local perspective but also a global one.
The studies presented in these two volumes contribute toward an understanding of the systemic nature of innovations and enable reflection on their potential applications, in order to think about the meaning of growth and prosperity.
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Table of Contents
Cover
Title Page
Copyright
Introduction: General Presentation
1 Economy – Innovation Economics and the Dynamics of Interactions
1.1. Introduction
1.2. The definition of innovation and the primacy of J.A. Schumpeter’s work
1.3. How can we measure innovation, in all its forms?
1.4. From the entrepreneur to the multiple actors of innovation
1.5. Innovation policies and the innovation system
1.6. Conclusion
1.7. References
2 Management – Managing Innovation According to Space, Time and Matter
2.1. Introduction
2.2. Managing innovation: a question of space
2.3. Managing innovation: a matter of time
2.4. Managing innovation: a question of matter
2.5. Conclusion
2.6. References
3 Agriculture – Agricultural and Food Innovations and Agro-ecological Transition
3.1. Introduction
3.2. Two centuries of agricultural revolution without “innovation”
3.3. The green revolutions driven by linear and technological innovation design
3.4. The notion of innovation in the face of agricultural and food transitions
3.5. Sector specificities of innovation in agriculture and food
3.6. Conclusion
3.7. References
4 Anthropology – Anthropological Aspects of Innovation: Defining Benchmarks
4.1. Introduction
4.2. Innovation, a total social phenomenon, between invention, diffusion and reception
4.3. The force of constraints or innovation as a process of insertion in a field of contradictory forces
4.4. Conclusion
4.5. References
5 Business – Business Creation and Innovative Entrepreneurial Ecosystems
5.1. The company, the territory and the ecosystem
5.2. From the business ecosystem to the entrepreneurial ecosystem: polymorphous innovation dynamics?
5.3. References
6 Capacity – Innovation Capacities and Learning Dynamics
6.1. Introduction
6.2. Learning and innovation capacities
6.3. The diversity of innovation capacities
6.4. Capacities, innovation system and competency building
6.5. Conclusion
6.6. References
7 Capital – Knowledge Capital and Innovation: Production and Use of Knowledge in Companies
7.1. Introduction
7.2. Knowledge capital: toward an understanding of the innovation process
7.3. Knowledge capital, tangible and intangible assets
7.4. Knowledge capital and knowledge management within organizations
7.5. Knowledge capital and open innovation
7.6. Conclusion
7.7. References
8 Cluster – Innovative Cluster: Geographical and “Virtual” Proximity in the Digital Era
8.1. Introduction
8.2. Innovative clusters: the matter of geographical and “virtual” proximity
8.3. Innovative clusters and the Internet and information and communication technologies revolution
8.4. Conclusion
8.5. References
9 Collaboration – Collaborative and Open Innovation in Highly Competitive Contexts
9.1. Introduction
9.2. Literature review
9.3. Collaborative innovation and innovation ecosystems
9.4. Open innovation versus closed innovation
9.5. Conclusion
9.6. References
10 Creativity – Creativity for Innovation: A Mutually Advantageous Relationship
10.1. Introduction
10.2. Increasingly “creative” representations of innovation
10.3. Impacts on creativity of its integration in the field of innovation
10.4. The same shared complexity
10.5. References
11 Cycles – The Long Cycles of the Economy and the Question of Innovation
11.1. Introduction
11.2. The conditions for cyclical economic development: the key role of innovation
11.3. Historical time and periodization of the economy
11.4. Conclusion
11.5. References
12 Design – Innovative Design: The Importance of a Methodical Approach
12.1. Introduction
12.2. What methods should be used to cultivate disruptive innovation in the 21st century?
12.3. Conclusion
12.4. References
13 Diffusion – Diffusion and Adoption Behavior of Innovations
13.1. Introduction
13.2. The epidemiological approach
13.3. The discrete choice approach
13.4. Public dissemination policies
13.5. Some extensions of the analysis: multiplicity of innovations and institutional framework
13.6. Conclusion
13.7. References
14 Disruption – Disruptive Innovation and the Evolution of Competitive Relationships
14.1. Introduction
14.2. The disruptive innovation model
14.3. The innovator’s dilemma
14.4. References
15 Ecosystem – Innovation Ecosystem: Generativity, Resilience and Power of Attraction
15.1. Introduction
15.2. Theoretical approaches of an innovation ecosystem
15.3. Main features of innovation ecosystems
15.4. Conclusion
15.5. References
16 Entrepreneur – The Innovative Entrepreneur as an Actor of Economic Change
16.1. Introduction
16.2. The entrepreneur as an actor of change
16.3. The evolution of the function of the innovative entrepreneur
16.4. References
17 Financing – Financing R&D and Innovation
17.1. Introduction
17.2. Information asymmetries and sources of funding
17.3. Reasons for funding reluctance
17.4. Public intervention in finance innovation
17.5. Venture capital
17.6. Conclusion
17.7. References
18 Frugality – Frugal Innovation as Inclusive Innovation
18.1. Introduction
18.2. Frugal innovation as a new technological paradigm
18.3. Case studies
18.4. Frugal innovation and similar approaches
18.5. Frugal innovation as an environmental innovation
18.6. Frugal innovation and sustainability
18.7. Drivers of frugal innovation: demand-pull and competition effects
18.8. Conclusion
18.9. References
19 Future – The Future of Innovative Technologies: Between Imagination and Technological Ideology
19.1. Introduction
19.2. A paradigmatic convergence
19.3. Technological revolution: the imagined future
19.4. Conclusion
19.5. References
20 Hybridization – Hybridization of Tech-Push and Market-Pull Approaches in Innovation Processes
20.1. Introduction
20.2. Definitions of Tech-Push and Market-Pull in the implementation of innovation processes
20.3. The nine demand readiness level (DRL) stages
20.4. Hybridization and agility of innovation processes
20.5. DRL-TRL and its applications to the hybridization dynamics of Tech-Push and Market-Pull approaches
20.6. Impacts of DRL-TRL
20.7. Conclusion
20.8. References
21 Incentives – Incentives for Innovation: Diversity and Public-Private Combinations
21.1. Introduction
21.2. The incentive for innovation and its forms
21.3. Diversity of applications of incentive forms
21.4. Conclusion
21.5. References
22 Indicators – The Complexity of Innovation Indicators
22.1. Introduction
22.2. Presentation of innovation indicators: input and output approach
22.3. Main limitations of innovation indicators
22.4. Conclusion
22.5. References
23 Information – Information for Innovation: Strategic, Competitive and Technological Intelligence
23.1. Introduction
23.2. The monitoring concept
23.3. “Traditional” monitoring and innovation
23.4. The search for information and innovation
23.5. Creative monitoring
23.6. Strategic innovation monitoring
23.7. Conclusion
23.8. References
24 Invention – Shared Inventions and Competitive Innovations
24.1. Introduction
24.2. From invention sharing to shared invention
24.3. From innovation to competitive innovation
24.4. From societal dynamics to the links between shared inventions and competitive innovations
24.5. References
25 Knowledge – Knowledge Management in Learning Innovative Organizations
25.1. Introduction
25.2. Knowledge and management
25.3. History of KM frameworks
25.4. Key KM concepts
25.5. Conclusion: perspectives for KM
25.6. References
26 Location – Local Innovation Issues and Priorities for Public Intervention
26.1. Introduction
26.2. Innovation policies adapted to territories
26.3. The territorialized priority of innovation
26.4. Conclusion
26.5. References
27 Market – Market Innovation: Opening and Controlling New Markets
27.1. Introduction
27.2. Factors that foster business innovation
27.3. The multifaceted nature of business innovation
27.4. Conclusion
27.5. References
28 Model – Business Models for Innovation Strategies
28.1. Introduction
28.2. A brief history of the evolution of business models
28.3. Types of business model innovation
28.4. Business model design versus business model reconfiguration
28.5. Business model inertia
28.6. BMI and competitive advantage
28.7. Conclusion: perspectives in BMI research
28.8. References
29 Network – Networks and Development of Innovation Processes
29.1. Introduction
29.2. Knowledge, learning and innovation network
29.3. Local innovation networks
29.4. Conclusion
29.5. References
30 Organization – Modern Innovative Organizational Structures
30.1. Introduction
30.2. Organizational structures for innovation
30.3. Perspectives
30.4. References
31 Paradigm – The Techno-scientific Paradigm: The Ethical Control of the Technological Progress
31.1. Introduction
31.2. The controversial techno-scientific gigantism
31.3. Technocracy and technicism
31.4. Technosciences and innovation in debate
31.5. Conclusion
31.6. References
32 Pattern – Linear, Interactive and Hybrid Patterns of Innovation
32.1. Introduction
32.2. The linear model of innovation
32.3. Towards interactive models
32.4. Hybridization of linear and interactive models of innovation
32.5. Conclusion
32.6. References
33 Persistence – The Economic Analysis of Persistent Innovation
33.1. Introduction
33.2. Persistent innovation: definition
33.3. Why is the notion of innovation persistence debatable?
33.4. Measurement of the phenomenon
33.5. Explanatory frameworks
33.6. Innovation persistence and the significance of economic evolution: path and past dependence
33.7. Conclusion
33.8. References
34 Policy – Reinventing Innovation: From Criticisms of the Traditional Paradigm to Policy Transformation
34.1. Introduction
34.2. Criticisms of the central innovation paradigm
34.3. Transformations of innovation policies: directionality and social innovation
34.4. Conclusion
34.5. References
35 Property – Intellectual Property and Innovation
35.1. Introduction
35.2. IPRs: some imperfect but unmatched mechanisms
35.3. The multidimensional impact of protection on innovation
35.4. The new roles of IPRs
35.5. Conclusion
35.6. References
36 Proximity – Impacts of Geographic, Organizational and Cognitive Proximities on Innovation
36.1. Introduction
36.2. A geographical proximity that plays favorably on innovation, without being indispensable
36.3. Other proximities have both positive and negative effects on innovation
36.4. Conclusion
36.5. References
37 Responsibility – Responsible Innovation in Corporate Strategy and Public Policy
37.1. Introduction
37.2. Responsible research and innovation policy
37.3. Responsible innovation in companies
37.4. Conclusion
37.5. References
38 Revolution – Innovations and Industrial Revolution
38.1. Introduction
38.2. From the technical revolution to the industrial revolution: what is the history?
38.3. The discontinuous diffusion of innovations in the face of the techniques in use
38.4. When the context stimulates innovation
38.5. Conclusion
38.6. References
39 Services – Defining Service Innovation
39.1. Introduction
39.2. From the specificities of services to the definitions of service innovation
39.3. Typologies and theoretical variations of service innovation
39.4. Conclusion
39.5. References
40 Social – Social Economy and Social Innovation
40.1. Introduction
40.2. Research on social innovation in economics and management
40.3. Defining social innovation
40.4. The production of social innovations: “top-down” and “bottom-up” logics
40.5. The roles of social economy in the production of social innovations
40.6. Conclusion and issues
40.7. References
41 Space – Innovation in Urban or Rural Spaces
41.1. Introduction
41.2. A concentration of innovation in urban spaces?
41.3. An underestimation of the innovation of firms located in peripheral areas?
41.4. Conclusion
41.5. References
42 Standardization – Standardization and Innovation Management
42.1. Introduction
42.2. Prerequisite for standards applied to innovation
42.3. Standards applied to innovation: promoting agility
42.4. Conclusion
42.5. References
43 Synchronization – Synchronization and Coordination of Innovation
43.1. Introduction
43.2. Innovation networks and synchronization
43.3. Coordination and proximity
43.4. Coordination at the heart of innovative performance
43.5. References
44 System – National Innovation System: The Primacy of Interactions Between Economic Actors
44.1. Introduction
44.2. The NIS and nature of multi-actor interactions
44.3. The NIS and economic development
44.4. Conclusion
44.5. References
45 Tax – Taxation and Innovation: Incentives, Attractiveness and Innovation Policies
45.1. Introduction
45.2. Taxation and incentives
45.3. Taxation and attractiveness
45.4. Taxation and innovation policy
45.5. Conclusion
45.6. References
46 Technology – Theoretical Model of Technology for Innovation
46.1. Introduction
46.2. Model of technology
46.3. Technological processes
46.4. The process of technology innovation
46.5. Application of the theoretical model
46.6. References
47 Timing – Timing of Innovation: The Central Position of the Innovative Enterprise
47.1. Introduction
47.2. Foundations of the timing of innovation
47.3. Key elements of innovation dating
47.4. The enrichment of the chronological study
47.5. Conclusion
47.6. References
48 Trajectory – Innovation Trajectories and Dynamic Capabilities
48.1. Introduction
48.2. Paradigms and technological trajectories: theoretical and empirical approaches
48.3. The company’s trajectory or the evolution path
48.4. Trajectory formation: dynamic capabilities and knowledge capital
48.5. The collective dimension of trajectories and its consequences
48.6. Conclusion
48.7. References
49 User – User Innovation: Interactions Between Users and Firms in Innovation Processes
49.1. Introduction
49.2. Motivations for user innovation
49.3. The role of users in innovation processes
49.4. The symbiosis between user innovation and manufacturer innovation
49.5. Conclusion
49.6. References
50 Value – The Value of Innovations: Specificity and Evaluation Methods of Innovation
50.1. Introduction
50.2. Where does the value of innovations come from?
50.3. Methods for assessing the private value of innovations
50.4. The social value of innovations
50.5. Conclusion
50.6. References
51 Work – Innovative Behavior at Work
51.1. Introduction
51.2. Organizational innovation and work behavior
51.3. Theoretical perspectives on work behavior
51.4. Conclusion
51.5. References
52 X-Innovation – The Polymorphism of Innovation
52.1. Introduction
52.2. Terms
52.3. References
List of Authors
Index
Summary of Volume 2
End User License Agreement
List of Illustrations
Chapter 1
Figure 1.1. Member countries' innovation performance (source: European Innovatio...
Chapter 2
Figure 2.1. An innovation process (source: Cohendet and Simon 2015). For a color...
Figure 2.2. The meeting of viewpoints during the innovation process (source: Bol...
Chapter 7
Figure 7.1. The company’s knowledge capital (source: BPI, in Laperche (2017)). F...
Figure 7.2. Absorption capacity and knowledge capital. For a color version of th...
Figure 7.3. Open innovation and knowledge capital. For a color version of this f...
Chapter 9
Figure 9.1.
Chesbrough’s closed innovation paradigm (Chesbrough 2003)
Figure 9.2.
Chesbrough’s open innovation paradigm (Chesbrough 2003)
Chapter 12
Figure 12.1. TRIZ approach. For a color version of this figure, see www.iste.co....
Figure 12.2. Design thinking (from Brown 2008, pp. 88–89). For a color version o...
Figure 12.3.
C-K theory (Hatchuel
et al. 2018). For a color version of this figu...
Figure 12.4.
The Radical Innovation Design
®
method (according to Yannou
et al. 2...
Chapter 14
Figure 14.1. Correlation between product performance level, market profitability...
Chapter 18
Figure 18.1. Complex interplay between frugal innovation characteristics: a virt...
Chapter 20
Figure 20.1. “DRL-TRL” tool – the (patented) “agilization” tool for innovation p...
Figure 20.2. Various uses and adaptations of the DRL-TRL tool for accelerating d...
Chapter 30
Figure 30.1.
Model of the R&D activity
Figure 30.2.
Field of suitability of R&D and SVC organizational structures
Chapter 32
Figure 32.1. The linear model of innovation (source: author). For a color versio...
Figure 32.2. The interactive model of innovation (source: Kline and Rosenberg 19...
Figure 32.3. The technology readiness levels (TRLs) scale (source: Mankins 2009)...
Chapter 33
Figure 33.1.
Innovation persistence
Chapter 42
Figure 42.1. The principles of innovation management (source: Commission de Norm...
Figure 42.2.
From the project process... (source: ISO 56002)
Figure 42.3. ...to the implementation of an innovation management system. (sourc...
Figure 42.4. Examples of how to use the guides according to need (source: Commis...
Chapter 46
Figure 46.1.
Schematic view of the innovation process
List of Tables
Chapter 5
Table 5.1. Business and entrepreneurial ecosystems, invariants and own character...
Chapter 11
Table 11.1. Economic cycles (source: author, based on Kondratieff, Schumpeter an...
Chapter 22
Table 22.1.
Innovation indicators: presentation and comments
Chapter 24
Table 24.1. Cohesion factors necessary for the creation of shared inventions and...
Chapter 27
Table 27.1.
Typologies of market innovation
Chapter 36
Table 36.1.
Dimensions of proximity according to Boschma (2005) (source: author)
Chapter 50
Table 50.1.
Summary of the different value concepts and valuation methods
Guide
Cover
Table of Contents
Title Page
Copyright
Introduction: General Presentation
Begin Reading
List of Authors
Index
Summary of Volume 2
Other titles from ISTE in Innovation, Entrepreneurship and Management
End User License Agreement
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Innovation Economics, Engineering and Management Handbook 1
Main Themes
Edited by
Dimitri Uzunidis
Fedoua Kasmi
Laurent Adatto
First published 2021 in Great Britain and the United States by ISTE Ltd and John Wiley & Sons, Inc.
Apart from any fair dealing for the purposes of research or private study, or criticism or review, as permitted under the Copyright, Designs and Patents Act 1988, this publication may only be reproduced, stored or transmitted, in any form or by any means, with the prior permission in writing of the publishers, or in the case of reprographic reproduction in accordance with the terms and licenses issued by the CLA. Enquiries concerning reproduction outside these terms should be sent to the publishers at the undermentioned address:
© ISTE Ltd 2020
ISTE Ltd27-37 St George’s RoadLondon SW19 4EUUK USA
www.iste.co.uk
John Wiley & Sons, Inc.111 River StreetHoboken, NJ 07030
www.wiley.com
© ISTE Ltd 2021
The rights of Dimitri Uzunidis, Fedoua Kasmi and Laurent Adatto to be identified as the authors of this work have been asserted by them in accordance with the Copyright, Designs and Patents Act 1988.
Library of Congress Control Number: 2021932077
British Library Cataloguing-in-Publication Data
A CIP record for this book is available from the British Library
ISBN 978-1-78630-456-8
IntroductionGeneral Presentation
“Innovation is everything in the economy that is either not being done, or not being done again.”- Dimitri Uzunidis
Agility, flexibility and rapid adaptation to change are becoming the key words for growth and development in our society. Finding new ways of doing things and creating something new out of what already exists remains essential when facing crises (economic, social and environmental). The ability to innovate is therefore the main condition for maintaining the competitiveness and performance of companies, regions and territories in a changing context. innovative activity has long been considered a driving force for “progress”, but its impact on the transformation of socio-economic systems is greater when a succession of profound changes are introduced on broader scales (organizational, social, environmental, political, behavioral, etc.). Achieving these transformations requires the mobilization of resources, information, knowledge and networks of specific actors in order to guide innovation efforts to respond to more global challenges such as reducing environmental impacts, building resilience, and improving health, safety and people’s well-being. Through what mechanisms and under what conditions does innovation enable more radical changes that progressively and sustainably reorient our modes of development? This is the overall question that this two-volume encyclopedic book answers, by mobilizing a set of interdisciplinary theories and concepts devoted to the study of innovation.
Innovation, in fact, consists of the design and marketing of new goods and technologies, the application of new working methods or the conquest of new markets. Today’s knowledge-based economy implies that innovation is the result of greater interaction between businesses, universities, public institutions, consumers and citizens. Innovation networks create new knowledge and contribute to the diffusion of new socio-economic and technological models, through new modes of production and distribution. Innovation results from technological, organizational and commercial changes.
How do organizations design and manage innovation processes? What strategies and management tools do they apply for the concrete implementation of innovation processes? What role do innovation policies play in driving these processes? How does innovation impact competitiveness and performance? This involves analyzing companies’ technological opportunities, organizational strategies and the integrated management of research and development, marketing and financial projects, etc.
This book is dedicated to the study of innovation. Theoretical reminders are associated with the discussion of concepts. Written in a didactic way, the reader will easily be able to situate the current debates around the need for technological and social innovation and the imperative of creating a climate conducive to the launch of large-scale innovation processes, because the current socio-economic stakes are as important as they are global. The book consists of two volumes. The first one is devoted to the presentation of the basic concepts. Its aim is to provide a broad and precise overview of the fundamental issues addressed by economists, historians and engineers specializing in innovation. The second volume contains a set of studies of current concepts and opens the debate on the evolution of the concept of innovation in the years to come.
The innovation process has a causal relationship with a problem – technological, economic, social – posed to the market economy and identified consciously or unconsciously by its actors (companies, entrepreneurs, consumers, etc.). Innovation is thus linked to the search for the optimal solution to the problem posed. This presupposes the use of knowledge and information from practice, experience and scientific activity. Innovation is itself a cumulative and historical process defined by six major characteristics highlighted in this book: (a) the impacts of innovation are difficult to predict; (b) the scale of diffusion of innovation is difficult to calculate; (c) innovative activities are asymmetric and staggered in time; (d) the time of learning, execution and diffusion plays a crucial role in the act of innovating; (e) the business environment conditions the time, scale, nature and impacts of innovation; and (f) innovations are interdependent.
In new approaches to innovation, the entrepreneur and the company are studied through their skills and their function of resource creation. Gradual or radical innovation thus becomes endogenous and is integrated into a complex process characterized by a lot of feedback and interactions in production and marketing networks: clusters, sectors and territorial or national innovation systems. The innovative organization is presented as a dynamic system composed of specific and diversified skills. Through the acquisition, combination and mobilization of these competencies, the innovator (entrepreneur or organization) can create technological resources and evolve the relationships it maintains with its environment. This explains the importance of design, application and development management in the implementation of an innovation process. An innovation system (sectoral, territorial or national) mobilizes a set of knowledge and skills resulting from learning processes and integrated into its memory. This knowledge must be enriched in order to be valorized by technological, organizational and commercial innovation. The survival of the system depends on its capacity to innovate, which enables it to face external aggressions, to transform and endure. External stimuli (competition, product substitutability, innovation policies, etc.) are generated by the economic context and affect the means of selection of entrepreneurs, companies and other public or private institutions. Selection procedures are shaped by the business climate: the nature of the product market, the availability of capital and labor, the pace of innovation, the effects of public policies, etc. They can, therefore, create alternatives to the mode of operation, management and production of a given firm (of an organization or, more generally, of a particular innovation system). It is thus clear that the effectiveness of innovation management is highly dependent on the internal capacity to seize external opportunities. The authors of this book repeatedly stress that innovation is part of the dynamic growth model based on uncertainty, risk and profit. The “flaws” that characterize an economic system are, however, important sources of opportunities for investment, production and the diffusion of innovations.
The richness of this book is the result of the reflections developed within the Research Network on Innovation (RNI) and carefully selected to take into account current and historical analyses, the relationship between technological mutations and social change, and the presentation and perspective of management, strategies and innovation policies. The authors are among the most eminent specialists of the Network, whose main objectives are the study of innovation processes in today’s information and knowledge society, the analysis of the intensification of links between the worlds of research and business, and the examination of the modes of appropriation and management of innovation by companies from a global as well as local or sectoral perspective. The Network has more than 1,500 researchers in 36 countries specializing in the multidisciplinary study of innovation: economics, management, engineering, sociology, history, law, epistemology, anthropology and psychology of the innovator.
The guiding principle of the studies presented in the two volumes allows us to understand the systemic nature of innovations and to reflect on their potential for dissemination and application, to study how innovations question our categories of thought and challenge the traditional mapping of knowledge... to think about the meaning of innovation.
This book is the continuation of a set of books dedicated to the study of innovation in the “Innovation in Engineering and Technology” Set published by ISTE and Wiley:
–
Innovation Engines: Entrepreneurs and Enterprises in a Turbulent World
(2017).
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Science, Technology and Innovation Culture
(2018);
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Collective Innovation Processes: Principles and Practices
(2018);
Divided across two volumes, it is composed of four long chapters on epistemology, economics, management and engineering that trace the contours of the holistic conception of innovation and continues with 81 shorter chapters that present and discuss, according to the sensitivity of their authors, the key notions associated with the studies of innovation. Note that the last chapter of Volume 1 on “X-Innovation” is devoted to highlighting the complexity of the concept in order to open perspectives for future research on innovation.
We would like to thank our colleagues Sophie Boutillier (University of the Littoral Opal Coast), Thierry Burger-Helmchen (University of Strasbourg), Vanessa Casadella (University of Picardie), Joëlle Forest (National Institution of Applied Sciences, Lyon), Michaël Laviolette (University of Lyon), Laure Morel (University of Lorraine), Francesco Schiavone (Parthenope University of Naples), Bérangère Szostak (University of Lorraine) and Corinne Tanguy (AgroSup-Dijon) for their contribution to the conception of this book.
We express our gratitude to our colleague Laurent Adatto for his contribution to the finalization of this important project.
Finally, it is important to mention the contribution of our colleague Blandine Laperche, President of the Research Network on Innovation, to the realization of this project. We express our gratitude and best wishes to her.
Introduction written by Dimitri UZUNIDIS and Fedoua KASMI.
1Economy – Innovation Economics and the Dynamics of Interactions
1.1. Introduction
Capitalism cannot and will never be stationary, Schumpeter once said. In a process of “creative destruction”, the technologies of the present become obsolete, while innovations emerge and feed new economic cycles. Economic history (Braudel 1979) clearly shows new combinations of production factors: products, production processes, sources of raw materials and semi-finished products, organization of work and markets. In short, innovations have fueled economic growth. Since the 18th century, a number of economists, such as A. Smith, J.B. Say, D. Ricardo, T.R. Malthus, K. Marx, etc., have provided the conceptual bases on which the economic theories of innovation have been developed.
Innovation economics was born in the wake of the industrial economy, in the aftermath of World War II. The neoclassical approach first considered technical progress as an exogenous phenomenon, a residue of the production function in models of economic growth (Solow 1956, 1957), and the economists were mainly interested in its effects on the economy, especially on employment. But the recognition of its role in economic growth and evolution, in the wake of the work of J.A. Schumpeter, led them to study in greater detail the mechanisms of its genesis, at the micro, meso and macro levels.
The evolutionary theories initiated by R. Nelson and S. Winter (1982) focus on the genesis of innovation within organizations. They see it as a systemic phenomenon, resulting from the interaction between actors within organizations (giving rise, through learning, to organizational routines, a source of change and inertia), as well as resulting from fruitful interactions between organizations and institutions (analyses in terms of innovation systems at different scales: local, regional, national, sectoral). A country, like a company, is situated, in its development, on a technological trajectory that largely conditions its capacity to assimilate new technologies.
For their part, endogenous growth theories (Romer 1994) study technical progress as the result of private and public investment in the sphere of the economy, particularly in knowledge, infrastructure and human capital. Private investments are made by individuals motivated by profit. Economic growth is then determined by the behavior of economic agents and macroeconomic factors. The field of public policy then becomes paramount, and theoretical work calls for the replacement of big scientific and technical programs that marked the post-war period by more indirect modes of intervention. They are based, on the one hand, on the framework conditions for innovation (by strengthening the components and interactions within innovation systems), and, on the other hand, on incentives to invest and innovate, particularly for firms. This results in positive externalities, which can be seen as the basis for justifying government intervention.
This contribution looks back at some of the evolutions of the major issues of innovation economics. In the first part of the chapter, we attempt to define and develop the meaning of the word innovation, with a particular interest in the work of J.A. Schumpeter. Then, in the second part, we look at the difficult issue of measuring innovation, in particular because of its multifaceted nature. The identification of the key actors of innovation (entrepreneurs, large companies, as well as universities, so-called third places) is the subject of the third part. It reveals their diversity and the need for their interaction to ensure both the production and the diffusion of innovation. The fourth part of this chapter is devoted to the question of these systemic relationships and to the evolution of policies dedicated to strengthening them.
1.2. The definition of innovation and the primacy of J.A. Schumpeter’s work
While the concept of innovation is omnipresent today and symbolizes the latest form of modernity, it is nevertheless very old and has not always been associated with progress and growth. According to B. Godin (2014), this concept dates back to Antiquity and was used by Greek philosophers in their political theories. This political meaning remained dominant until the 19th century. Until then, innovation evoked a “change in the established order” in politics and religion. Innovation was thus subject to prohibitions (e.g. by King Edward VI of England in 1548), and religious or political innovators (such as the French revolutionaries of the 18th century and the reformers of the 19th century) faced charges, imprisonment or worse. It was not until the 20th century that the meaning of the word “innovation” changed and became associated with progress, creativity and economic growth. From that century on, “there is no longer any doubt that innovation has become a virtue, not a vice” (Godin 2014, p. 33). Innovation then clearly became associated with technology.
J. A. Schumpeter is considered the first economist to use and construct an economic theory of innovation. Yet, before him, classical economists were largely interested in the changes brought about by technical progress, a term found in the writings of A. Smith, D. Ricardo, J.B. Say and K. Marx, to name but a few. At the beginning of the 19th century, Saint-Simonism (H. de Saint-Simon, 1760–1825) widely popularized the idea that technical progress (via “industrialism”) was the necessary condition for improving the well-being of humanity. Moreover, as pointed out by B. Godin (2014), the sociologist G. Tarde (1843–1904) is often mentioned as the first to have devoted theoretical writings to innovation at the end of the 19th century. In The Theory of Economic Development (1981), Schumpeter considers that evolution results from the implementation of new combinations of means of production: the manufacture of a new good, the introduction of a new production method, the opening of a new outlet, the conquest of a new source of raw materials or of semi-finished products, the realization of a new organization, such as the creation of a monopoly situation. The importance of this definition and, more generally, of the Schumpeterian analysis of innovation can be explained by several arguments, which we present below:
First of all, this definition is important because, for the first time, it distinguished the various forms that innovation can take, without reducing it to technology. This variety is central to the contemporary definition proposed by the OECD in the Oslo Manual (OECD 2005), which distinguishes the product, process, new business method and new organizational method (OECD 2005). The most recent definition (OECD 2018) focuses on the enterprise and simplifies this definition by distinguishing product and business process innovation (OECD 2019). The notion of “business” processes refers to the traditional functions of the enterprise. It brings together process, and the organizational and marketing innovations defined in previous versions of the manual.
However, in the Schumpeterian analysis of long-term economic cycles (business cycles), the so-called Kondratieff cycles or waves, technology plays a major role. In Business Cycles (1939), Schumpeter in fact links the three Kondratieff movements from 1750 to 1940 and the three waves of fundamental innovations, which essentially concern technology: textiles, iron and steel, steam at the end of the 18th century, railways in the mid-19th century; and electricity, automobiles, chemicals at the beginning of the 20th century. The role of technological innovation was then crucial in explaining economic cycles (Uzunidis 1996). These innovations lead to an increase in supply capacity (increased demand for production goods, lower production costs, increased quantities of new products on offer) and a revival of demand (new consumption needs, credit). We also find this primacy of technology in the analysis in terms of the techno-economic paradigm proposed by C. Freeman and C. Perez (Freeman 2008; Perez 2010). This is defined as the set of most successful or profitable practices, in terms of the choice of inputs, methods and technologies, and organizational structures, business models and strategy. The paradigm forms a kind of common sense that facilitates technology diffusion.
In Schumpeter’s analysis, innovation is therefore associated with evolution and change. This is the second essential point. It is new combinations that cause the hurricane of “creative destruction” (2008), continuously destroying old elements and creating new ones. Thus, the changes brought about by innovation also have negative consequences. Going back to the analysis of long waves, over-investment in the growth phase is punished by losses, layoffs and bankruptcies, creating a “vacuum cleaning” effect that can unleash the entrepreneurial spirit again.
This central role of technology, and therefore the potential for change it offers, is still a subject of debate today. For R. Gordon (2016), for example, information and communication technologies affect a smaller number of activities compared to the key technologies of the second industrial revolution (electricity, automobiles and aviation), which hampers the recovery of activity. Other authors, however, believe that current technologies bring many opportunities, jobs and growth, but that the economic and social system does not sufficiently promote their exploitation and diffusion. According to D. Archibugi (2016), for example, massive public investments, in science and technology, as well as in infrastructure, should be made to help companies develop marketable products and services. The current context of the strong financialization of the economy, which makes stock market investments more remunerative and more risky than productive ones, also plays a key role in the absence of the long-awaited recovery of a new long-term cycle (Uzunidis 2003). The orientation of science and technical progress towards short-term profitability objectives and the insufficient consideration of major challenges (such as climate change, population aging, pandemics) are also obstacles to the emergence of a new cycle.
Admittedly, and this is the third argument justifying the importance of Schumpeter’s contribution, not all innovations have the same effects. New combinations may result from continuous and small-scale transformations – minor or incremental innovations – and their effect on economic structure is therefore limited. New combinations that appear discontinuously are similar to radical innovation. These are innovations that have a significant impact on the market and the activity of firms. This impact may concern the modification of market structure, the creation of new markets or the rendering of existing products obsolete. In reality, however, in Schumpeter’s analysis of cycles, new combinations appear in clusters, thus combining major and minor innovations. Radical innovations initiated by entrepreneurs begin the cycle. The creation of profit opportunities attracts mimicking entrepreneurs who propose minor innovations and thus extend the growth trajectory at a slower pace until the cycle turns around. Researchers today refer to a third category, “disruptive” innovation (Christensen 1997, 2003). Its characteristic is to introduce new performance criteria by targeting different users. It is opposed to continuous innovation and favors new entrants who adopt a different business model. Thus, the notions of disruptive and radical innovation are close, but radical innovation is more associated with new technologies, stemming from scientific and technical progress, while disruptive innovation can also be associated with non-technological changes. Products may be simpler or offer new features that will appeal to new consumers.
The fourth argument is that innovation corresponds to an “economic function” embodied by certain individuals. For Schumpeter, these are the “entrepreneurs”, whose function is to execute new combinations (Schumpeter 1981). We will return to its characteristics later. By emphasizing this function of commercialization or introduction into production, Schumpeter highlights the essential difference between novelty or invention (in the technical field) and innovation. If the invention is defined as a technical solution to a technical problem, innovation consists of productive and commercial exploitation, with the aim of making a profit. The characteristic that distinguishes a mere novelty from an innovation is that the latter involves implementation, whether it is a market launch for a product or service or a productive use for process, marketing or organizational innovations. The objectives of innovation are always economic: to increase sales, to open new markets, to reduce the costs of production, of internal organization, or of internal and external transactions, and to increase labor productivity.
However, the creative power of entrepreneurship and the arrival of the “troop” of entrepreneurs, at the heart of his analysis in The Theory of Economic Development (Schumpeter 1981), depersonalizes itself in the course of his work, showing Schumpeter’s awareness of the nature and scope of the transformations that took place in the structure of capitalism since the beginning of the 20th century. The observation of the existence of what he calls “trustified capitalism” in Business Cycles (1939) will receive increasing attention to the point of becoming the essential cause of the historically determined character of capitalism in Capitalism, Socialism and Democracy (2008). The planning of technical progress by large companies and the development of private research laboratories with the aim of strengthening the potential for innovation mark the “bureaucratization” of technical progress. Technical progress is becoming depersonalized and automated (Schumpeter 2008). This bureaucratization, which is necessary to face competition, is a sign of the strengthening of monopolistic structures, which will, according to him, overwhelm both entrepreneurial spirit and capitalism (see section 13.4). Contemporary economists, especially neo-Schumpeterians, refer to this evolution by evoking a “Schumpeter Mark I” in which it is small firms that innovate, and a “Schumpeter Mark II” in which it is large firms that play this role (Malerba and Orsenigo 1995). In fact, as we show below, systemic relationships unite actors within innovation systems.
1.3. How can we measure innovation, in all its forms?
Innovation is a multifaceted phenomenon and is not easily confined to a typical indicator. This is also the case for the measurement of economic growth, which is expressed, despite the limitations of this indicator, by the evolution of gross domestic product (GDP). Research & Development (R&D) and patents have long been considered as key indicators of innovation, the former measuring the resources allocated to innovation and the latter evaluating the results of the activity.
The measurement of R&D is based on data collected from companies and research organizations, according to the codification carried out by the Frascati Manual, the seventh edition of which was published in 2015. Gross domestic expenditure on R&D (GERD) refers to the total expenditure on R&D performed by businesses, the government, higher education and the private non-profit sector at the heart of the economy. These expenditures include R&D financed from abroad, but exclude the financing of the R&D activities of foreign businesses. R&D intensity is established by the ratio of R&D expenditure to GDP for a country or the ratio of R&D expenditure to turnover for companies.
Global R&D capacity, as measured by public and private investment, has doubled since the mid-1990s. This increase in global R&D capacity is due in particular to the growth in corporate spending, which accounts for about 70% of total R&D spending. While the financial crises that marked the period (the crisis in emerging countries in the early 1990s, the crisis of new economy start-ups in 2001, the financial crisis of 2008) have led to cyclical reductions in R&D investment, companies are also relying on innovation to boost the growth of their activities. This can also be explained by the strong increase in spending as a percentage of GDP in emerging countries (China, Korea and Israel), compared with slower growth in the EU-28, the United States or Japan.
One of the major limitations of this indicator is that R&D appears to be mainly focused on science and technology and has difficulty capturing the expenditure incurred to bring about other forms of innovation, whether organizational or commercial. The services that make up an important part of the new solutions offered by companies are better evaluated by marketing expenses, which are not included in the R&D measurement. As a result, the expenditures made by small firms (which rarely employ researchers) to innovate organizationally or commercially are poorly understood and, therefore, not considered as being very innovative.
A patent is an industrial property title granted to an inventor for a period of 20 years, often used as an indicator of results and innovation performance. It has the advantage of being an available and reliable indicator, whose databases are public. Worldwide patent registration statistics show a strong growth in patent registrations from the 1970s onwards. Innovators around the world filed some 3.3 million patent applications in 2018, an increase of 5.2% for the ninth consecutive year of growth. At that time, approximately 14 million patents were in force worldwide. The largest numbers of patents in force were registered in the United States (3.1 million), China (2.4 million) and Japan (2.1 million) (WIPO 2019).
However, as an indicator of innovation, the patent also suffers from many limitations. On the one hand, it only measures registered “inventions”, thus leaving aside all other possible forms of innovation. On the other hand, many inventions are not patented, especially if they do not meet the criteria of novelty, inventive step and industrial application. An invention that is useful, but not innovative (so if it is already part of the state of the art, in other words everything that has been made public at the filing date), will not normally be able to pass the stage of the research report carried out by the industrial property institute. A registered patent does not always result in an innovation, i.e. a new product launched on the market or a new process integrated into the production process. Many patented inventions remain unexploited, often for strategic reasons. For example, some patents are intended to deceive competitors about the technological trajectories followed. Sleeping patents are also very common. In this case, they are not exploited because the profit prospects are lower than the costs of bringing them to market. The company holding the patent may not have the resources necessary to exploit the invention or may prefer to wait for the previous invention to become fully profitable before launching a new one (in this case, one can speak of “technological Malthusianism”).
However, criticisms have been made about the quality of patents, particularly those granted in the United States in the years 1990–2000, given the favorable attitude of this country towards inventors. In reality, the criteria for patentability have, in many cases, been little respected, leading to the multiplication of low-quality patents and numerous challenges and lawsuits. The statistics would thus be distorted by the multiplication of these “rotten” patents. Another difficulty related to the measurement of patents lies in the fact that they are national titles valid in the countries where protection has been claimed (apart from the unitary patent in Europe, the use of which still depends on the ratification of certain agreements between signatory countries). In order to avoid counting them several times, statisticians have defined an indicator called a “patent family” which designates a set of patents filed in several countries to protect the same invention. We distinguish, for example, triadic “patent families”, which are a set of patents filed with three of the main offices, namely the European Patent Office (EPO), the Japanese Patent Office (JPO) and the United States Patent and Trademark Office (USPTO).
Innovation indicators are not limited to these two; they also include the number of researchers, scientific publications, amounts devoted to financing innovative firms (venture capital), registrations of other intellectual property titles (trademarks, designs), revenue generated by innovative firms, diffusion of key technologies, etc. A better understanding of the innovation process leads not to limiting research to traditional indicators but to refining the evaluation of innovation efforts and performance by using other indicators. For example, at the firm level, statisticians (see OECD 2019) seek to better measure intangible investments that are not R&D (such as software and databases), or the interactions that firms develop with other firms or institutions. At the country level, indicator scoreboard and summary indicators are being developed to quantify innovation.
In Europe, the European Union Innovation Scoreboard (created in 2001) provides a synthetic indicator for ranking countries according to their innovation performance. Four categories of countries are defined: modest innovators, moderate innovators, notable innovators and innovation champions. The results for 2019 were as follows.
Sweden, Finland, Denmark and the Netherlands appeared to be the leaders in innovation, positioning themselves well above the European average. Notable innovators included the following countries: Luxembourg, Belgium, the United Kingdom, Germany, Austria, Ireland, France and Estonia. Their results were slightly above (or close to) the European average. The performance of moderate innovators was between 50% and 90% of the European average. This category included many countries in Eastern and Southern Europe, such as Portugal, Czech Republic, Slovenia, Cyprus, Malta, Italy, Spain, Greece, Lithuania, Slovakia, Hungary, Latvia, Poland and Croatia. Finally, the modest innovators, Romania and Bulgaria, had a performance below 50% of the European average.
This synthetic indicator – the Summary Innovation Index – is based on four broad categories of indicators and 10 dimensions of innovation. The “framework conditions” take into account the essential factors of innovation performance, and this category includes human resources, the attractiveness of the research system and the environment conducive to innovation. “Investments” measures public and private investment in innovation. “Innovation activities” seeks to measure the efforts made by firms, distinguishing between the characteristics of innovators, networks and intellectual assets. Finally, the “Impacts” category considers impacts on employment and sales. In total, the composite indicator is constructed from 27 indicators.
Figure 1.1.Member countries' innovation performance (source: European Innovation Scoreboard 2019). For a color version of this figure, see www.iste.co.uk/uzunidis/innovation1.zip
Such an indicator makes it possible to monitor the performance of the European Union and of each country over time, as well as serves as a guide for the definition of public policies adapted to the specific problems encountered in each country. One notable result is that the countries that champion innovation show similar performance in each dimension of innovation measured. This leads to a view that the overall strength of the national innovation system plays a key role in innovation performance (see section 1.5).
1.4. From the entrepreneur to the multiple actors of innovation
While Schumpeter was the first economist to develop an innovation theory, he also designated the entrepreneur as the economic agent who achieves “new combinations of production factors” (Boutillier and Uzunidis 2016). Entrepreneurial economics certainly did not begin with Schumpeter. As early as the 18th century, the entrepreneur was already attracting the attention of economists, but more to emphasize their ability to take commercial risks (the merchant) than to design and manufacture new products (the industrialist) (Cantillon 1755). The figure of the “projector” was generally devalued because his extravagant projects ran the risk of a general crisis, harmful to all, according to A. Smith (1759, 1776).
As pointed out above, technical progress did not appear in the 18th century. It is a permanent feature of human societies. During the 18th century, however, a twofold evolution can be observed. On the one hand, technical progress is intrinsically linked to the market and gives rise either to the production of new consumer goods intended for the final consumer or to the production of machines for companies that automate production processes. On the other hand, there is a separation between science and technology. This evolution is evident in Say’s (1803) definition of the entrepreneur as the intermediary between the scientist who produces knowledge and the worker who applies it to industry. The entrepreneur thus creates markets, wealth and jobs.
Whereas until the 18th century, the entrepreneur was essentially a merchant and, in this sense, could be dependent on a difference between sale and purchase prices (Landes et al. 2010). In the 19th century, the entrepreneur became an industrialist. Until this period, the field of technology was rather that of the craftsman (Zilsel 1942). This evolution did not take place without resistance nor social and political conflicts; machines were then qualified as job killers (Jarrige 2009). However, while many craftsmen disappeared, caught up in the big businesses that reduced them to the precarious condition of factory workers, others became entrepreneurs and created industrial empires, via the development of new technologies (electricity, mechanics, automobiles, telecommunications, aviation, etc.) (Perrin 2017).
The managerial company model (separation between ownership and management of capital) became a norm by the end of the 19th century, mainly in the United States and then in Western Europe. Schumpeter (2008), an attentive reader of Marx, detected in this evolution a major change in capitalism, which was becoming bureaucratized (see section 13.2). This observed disappearance of the entrepreneur marks the continuation of a process of division of labor between the manager (who manages the firm) and the shareholder (who finances it through the shares they buy). The entrepreneur, the driving force of the first Industrial Revolution, disappears to the benefit of a new institution, the managerial company.
In the years following the end of World War II, during the period of reconstruction, the economies of industrialized countries underwent an unprecedented transformation (Dockès 2020), taking advantage of new technologies and heavy investments developed during the war (automobiles, aviation, chemicals, nuclear, digital, IT, etc.). The entrepreneur was then seen as an endangered species, with the future belonging to the “technostructure” (Galbraith 1967) thanks to the “visible hand of managers” (Chandler 1977). This period of strong growth was based on the partnership between the large company and the labor society. The State then played a central role in financing scientific research and planning the economy, contributing to the development of managerial firms in highly capital-intensive sectors (steel, telecommunications, transport, energy, petrochemicals, etc.) (see section 13.5). The time had come for mass production and consumption. Gradually, this model was seized, leading to the “great turnaround” of the 1970s (Dockès 2020).
Big corporations entered a crisis period; the markets created by the innovations of the post-World War II period were saturated. Unemployment was rising sharply in the industrial countries. Large companies no longer generated enough jobs, and even drastically reduced their workforce in order to reduce their costs. From the end of the 1970s onwards, the creation of companies appeared as a means of public policy to reduce unemployment whatever the job seeker’s profile (women, young people, elderly people, immigrants, non-qualified people, etc.). The creation of a company then became a kind of injunction to designate this process of socio-economic transformation. Bringing the Schumpeterian entrepreneurial theory up to date, the injunction is not only about job creation (and first and foremost that of the entrepreneur), but also about innovation, which is more than ever necessary to strengthen the competitiveness of economies. The new entrepreneur must be an innovator like their peers and is an integral part of the national innovation system in a knowledge-based economy (see section 1.4). The entrepreneurial society (Audretsch 2007) gradually began taking over from the labor society.
The entrepreneur, who had been sidelined by the managerial company, then made a big comeback by developing new innovations. They act in the sense in which Say understood it, i.e. as an intermediary between the scientist and the worker. The scientist was no longer isolated in an obscure laboratory, as was imagined in the 18th and 19th centuries, but was part of the great scientific laboratories financed by States, often by the army (Isaacson 2015). Young entrepreneurs, poorly endowed with capital, but very imaginative and with a keen sense of business, created industrial empires, giving rise, for example, to what we now refer to as GAFAM (Google, Apple, Facebook, Amazon, Microsoft). The large firm did not disappear, therefore, but took on a new form, favoring subcontracting and cooperative relationships via open innovation (Chesbrough 2003), rather than the model of vertical integration which the managerial firm of the 1950s–1970s was based on, inspired by the legacy of the first Industrial Revolution. The firm has taken the form of a network firm, combining classical integration with multiple cooperative relationships with universities, other competing firms (coopetition), complementary firms (customers and suppliers), start-ups, communities and crowdsourcing (Laperche and Uzunidis 2019). The constitution and development of its knowledge capital (i.e. all the information and knowledge produced, accumulated and systematized by the company with the aim of innovating) is carried out collectively (Laperche 2017). The principle of open innovation offers innovative entrepreneurs, who have become start-uppers, the opportunity to develop cooperative relationships with large companies, as well as with research centers and universities (Audretsch and Link 2017), as put forward with the concept of the “triple helix” (Etzkowitz 2003).
How companies manage their innovation process is a key theme in innovation management. The work of Nonaka and his co-authors, for example, focuses on the genesis and circulation of knowledge in the organization. This is the SECI (socialization, externalization, combination, internalization) model (Nonaka and Takeushi 1995), where innovation in the organization emerges from the interaction between explicit and tacit knowledge, associated with a circulation of knowledge from the individual to the inter-organizational level. Similarly, the C-K theory (which stands for concept and knowledge) focuses on issues of creativity within design and provides further developments on the genesis of knowledge within organizations (Hatchuel and Weil 2009; Le Masson and Macmahon 2016).
This work on the production and dissemination of knowledge within organizations is part of resource theory. The authors place particular emphasis on the role of competencies (especially key competencies (Prahalad and Hamel 1990)) and capabilities in explaining the competitive advantage of firms. Capabilities develop new specific assets gathered in organizational routines, which are called “dynamic capabilities” by Teece
