VERA – Forward Visions on the European Research Area

VERA is funded by the European Union's FP7 programme for research,
technological development and demonstration under grant agreement no 290705

INFU Innovation futures in Europe: A foresight exercise on emerging patterns of innovation. visions, scenarios and implications for policy and practice.

Code: B03

Primary project information

Lead: Austrian Institute of Technology (Austria)
Additional project partners: Fraunhofer Institute for Systems and Innovation Research (Germany), Strategic Design Scenarios (Belgium), Z_punkt The Foresight Company (Germany)
Type of activity: Foresight report
Date conducted: 2011
Date of Publication: 2012
Duration: 30 months
Summary: New innovation patterns such as open innovation, user innovation or soft innovation are challenging established ways of developing innovations. It can be expected that some of these concepts and models become widely diffused in the future while at the same time totally new innovation patterns may emerge. A better understanding of plausible long-term scenarios for changing innovation processes and configurations and its implications for society and economy can help practinioners and policy makers in developing specific strategies to exploit the full potential of new innovation patterns. The INFU Foresight exercise aims to develop scenarios of future innovation landscapes in order to support strategy building for policy and other innovation actors. The scenarios will outline how future actors may collaborate in new configurations and with new approaches to transform knowledge into products and services within different socio-economic frameworks.To generate this anticipatory intelligence INFU is implementing an explorative dialogue with key stakeholders and experts using advanced creativity methods to foster thinking beyond established pathways and up-to-date prospective methods to structure the debate and ensure rigour of analysis. These bottom-up visions are confronted with different possible socio-economic framework conditions and global mega trends to finally synthesise consistent scenarios that are integrating micro, meso and macro elements of possible innovation futures with particular emphasis on the changes in nature and content of research. The explorative analysis will be complemented with a debate on the desirability of different innovation futures based on an assessment of the scenario implications for key societal challenges such as sustainability. Options for policy strategies to prepare for the identified changes in innovation patterns are derived together with key policy actors.
Financed by: European Commission - DG Research & Innovation
Budget: 598,082 Euros
Research area/market/industry/sector: Innovation, Socio-economic Sciences and the Humanities
Main report (full title): Innovation Futures: A Foresight Exercise on Emerging Patterns of Innovation. Visions, Scenarios and Implications for Policy and Practice

GRAND CHALLENGES

Economic Challenges: Sustainable system innovation will bring about new business models and opportunities. Circular economy innovation patterns bring about multiple new ways for companies to earn money and to create new business. In this landscape «low-tech» can be a cash cow or a business model. New sectors may emerge and opportunities abound, in particu- lar for agile SMEs operating on a local scale.
New “eco-products” could lead to the prolonging of the existing consumption patterns, hinder a value change in society and become a barrier to transition processes.

Cradle-to-cradle innovation patterns may lead to a lock-in in a non-sustainable economic paradigm, if we fail to change the economic system towards a full cradle-to-cradle economy with a high degree of immaterial solutions to societal demands and sustainable lifestyles. Also, several negative side effects, such as increased use of water, energy and transport may occur if the focus is too exclusively centred on waste avoidance.

Extreme re-use-oriented patterns carry the risk of emerging shadow economies with strongly negative consequences for the market and companies.
Economic Challenges Shortlist: New business models and opportunities as results of sustainable system innovation; New ways for companies to earn money and to create new business as results of circular economy innovation patterns; «Low-tech» as cash cow or business model; Emergence of new sectors and opportunities, in particular for agile SMEs operating on a local scale; Prolongation of existing consumption patterns, hinderance a value change in society and barriers to transition processes because of new “eco-products”; Need for changes in the economic system (high degree of immaterial solutions to societal demands and sustainable lifestyles) to avoid lock-ins from cradle-to-cradle innovation patterns; Exclusive focus on waste avoidance may have several negative side effects; such as increased use of water, energy, and transport; Extreme re-use-oriented patterns carry the risk of emerging shadow economies with strongly negative consequences for the market and companies.
Geopolitical Challenges: Circular economy innovation elements conflict with the growth paradigm that currently dominates global economies. If the concept is not implemented at a global level, the competitiveness of the respective countries and companies will suffer.
Geopolitical Challenges Shortlist: Economies pursiung novel economic paradigms compete with economies that stick to the current growth paradigm
Societal Challenges: Cradle-to-cradle elements in innovation patterns may bring about the new values, competencies and infrastructures required for an eco-consistent economy (emergent materialism). Traditional values such as appreciation of scarce resources may experience a revival.

Consumers will turn towards value-oriented buying, knowledge-based choice-making and even frugality-thinking. Many of the problems created by the current production/ consumption paradigms (e.g. landfills) can be mitigated.

Innovation patterns with a high emphasis on resource re-use carry the risk of worsening working conditions. The number of low wage jobs with unhealthy working conditions may multiply, a global “waste divide” may emerge with some countries up-cycling the others’ waste.
Societal Challenges Shortlist: Cradle-to-cradle elements in innovation patterns may bring about the new values, competencies and infrastructures required for an eco-consistent economy (emergent materialism). ; Traditional values such as appreciation of scarce resources may experience a revival.; Change of consumer behavior; such as turns towards value-oriented buying, knowledge-based choice-making or even frugality-thinking; Innovation patterns with high emphasis on resource re-use affect working conditions, number of low wage jobs, or even global "waste divide", with some countries up-cycling the others’ waste
Technical Challenges: New professions will emerge, some of them characterised by highly skilled craftsmanship.

Many of today’s companies lack the competencies required for system innovation, as they are very much focussed on individual products. There is still little awareness of the potential for profits arising from the whole system. This lack of competence may hamper the systemic paradigms and – in the case it succeeds – will cause difficulties for a number of companies.
Technical Challenges Shortlist: Emergence of new professions, some of them characterised by highly skilled craftsmanship; Uprise of systemic paradigms causes difficulties for companies that lack competencies required for system innovation

Summary of relevant aspects

Aspects of RTI Governance: At the policy level, the emergence of new mediation mechanisms require a policy that takes a leading part in making new forms and patterns of innovations more visible and eligible for funding as well. Accordingly, there is the need for more coordination between different policies and policy levels along with efficient and effective governance (multi-level governance). This holds especially true when we call for more systemic innovations. Policy coordination must be enforced and aligned with various instruments from different policy realms. Therefore, a new form of system-integrator for systemic innovations is required and non-engineering, non-natural science competencies from the humanities should be included in the innovation process. At the regional and urban level, policy has to consider whether or not to play a much more active role as a proactive mediator.
Other Aspects of Governance: The initiations and governance of highly participatory processes is challenging for companies, and is a learning process that requires trust of self-organisational mechanisms. However, such mechanisms can be controlled in a traditional hierarchical way. Thus, (top) management has to create the conditions and capacities to manage innovation, its role so to set the right conditions for innovation to strive in a given organisation.
Background information: There are a number of indications that the way economic actors interact in order to transform knowledge into new products and services is currently undergo- ing substantial changes. While a few radical visions have been taking up these signals and are predicting disruptive change for the economy and society, there is little systematic exploration of possible future innovation landscapes and their implications for economy and society. However, in order for research and other policies to be prepared for the challenges arising from these changes and to be able to benefit from them, a more solid understanding of possible innovation futures and their implications for society is needed. At the same time, there is a need for a debate among innovation actors from various perspectives to create awareness, shared visions, and the momentum for change.
The INFU project addresses newly emerging innovation patterns. Several new ways of organising innovation activities such as “open innovation” or “community innovation” are currently emerging in economy and society. While these have been discussed intensively in recent years, there is little systematic exploration of their potential for different sectors and areas and the implications for economy and society. For the first time, a foresight project has been conducted to analyse and discuss the emergence and diffusion of new innovation patterns and their implications for European policy.

In the last few years, new innovation patterns have begun to generate a great deal of discussion. For instance, in spring 2009, the International Society of Professional Innovation Management (ISPIM) organised its annual conference in Vienna under the key topic of “The Future of Innovation”1. More recently, the 2011 Innovation Convention held in Brussels discussed a number of topics around the question of how changing innovation patterns may impact the European innova- tion landscape.

Scenarios

Scenario 1: By 2025, the European Union has become energised by a new spirit of creativity and has turned into the world’s innovation centre. The EU is a main global innovation hotspot offering excellent research conditionsand providing the world with sustainable innovations, helping it cope with the grand challenges of our times. European societies have become a highly valued source for new product and service ideas, but above all for social innovation. In addition, sustainable business and consumption patterns have become the norm; economic growth and social welfare are no longer exclusively defined in monetary values.

On the positive side, one may expect that European societies benefit from high educational standards. Social and environmental aspects are considered and all relevant stakeholders are fully integrated into innovation processes. In addition, social welfare is on an exceptionally high level and researchers have access to superb research conditions and excellently equipped research infrastructures. Favourable framework conditions for entrepreneurs. Very low administrative barriers and widespread presence of private and public innovation spaces exists there as well.

A possible negative effect of this scenario is that the competitiveness of European companies decrease as they fail to open their processes to external innovation sources and stick to unsustainable manufacturing. The potential abuse of freely available content and widespread creative commons licenses are other scenarios.
Scenario 2: Demographic aging, inadequate policy responses, high levels of competitive pressure from other extremely innovative world regions, and a certain “innovation fatigue” of its population cause the European Union to lose most of its innovation capacity by 2025. Faced with this situation, policymakers, and entrepreneurs stick to obsolete models of growth and welfare, education and innovation. The few remaining innovation activities are exclusively business-driven and not embedded in systematic approaches to sustainable development.

The highly competitive strength of globally operating European companies that relocated R&D departments and other critical business units to “emerging” countries such as Asian and Latin American regions at an early stage can be considered as a positive impact of this scenario. However, i) the deterioration of Europe’s economic situation and declining welfare spending, ii) lack of appropriate framework conditions and opportunities for young creative people (who leave the European Union in ever greater numbers), iii) grim outlook for researchers, teachers, and professional coaches as research budgets shrink, and iv) unfavourable conditions for citizens with ideas for social innovations who face risk-averse social environments reluctant to innovate are on the negative side of this scenario.
In this scenario context we can also imagine a specific scenaretto as we mentioned earlier “When the Race Is Over,” at which point we envisage that innovation has lost its positive connotation and is more regarded as an undesired burden, something unnecessarily disruptive to society. Companies feel that they are better off when they limit the number of people involved in their innovation processes and voluntarily abandon all attempts that aim at the opposite. Surely, products are less innovative and less “cutting edge” as in former times, but they are of a higher quality, last longer, have real usage and emotional value for their owners and user.
Scenario 3: Europe has set the course for innovation and competitiveness. All major actors – from commerce, politics, and society as such – collaborate to open and streamline innovation processes, overhaul rigid administrative systems and promote innovation at every level, financially, and by providing good framework conditions. Europeans are highly motivated to contribute ideas. However, since innovations are guided mostly by an economic rationale, environmental problems are not addressed in a comprehensive and effective manner. Moreover, parts of the population drop out of this fast-paced lifestyle.

We can think about increasing business opportunities and sales potential for European companies with high innovation rates. In addition, innovative people, in particular the younger generations, may find excellent conditions for sharing and developing ideas. Regarding negative effects, firstly, there are increasing business risks for small and medium-sized companies with insufficient capacities for generat- ing high numbers of innovative products and services in the merciless and high-speed innovation race. Secondly, those who are not willing or able to follow the omnipresent innovation pressure are increasingly suspended and society may drift apart. And thirdly, more negative environmental impacts can be expected due to shorter product cycles and as the waste of resources continues and awareness of CO2 emissions remains insufficient.

Within this scenario context one may also imaging a further variant (scenaretto), which can be described as “Closed and Gated Innovation”. We may see a development where many companies learned the slogan “open innovation” the hard way. Most Eurostoxx companies experimented for a while with opening up their innovation silos, with inviting citizens – and their ideas! – into corporate invention, research and development processes, making much marketing ado around “user designed products.” In the end, dissipation of intellectual property hurt too much. Asian competitors quickly learned to sneak into innovation processes, and often were first on the global market with products developed in Europe. European IP initiatives did not really help combat industrial espionage, and the prosecution of infringements was slow and inefficient. Thus companies closed their gates. Moreover, the public innovation labs and creativity parks, established during the “innovative tens,” applied the same “date protection” rules as private companies. Innovation did not dry up. Perhaps it is even more valued as before, and any real or would-be innovator can claim to be a “bearer of secrets.” However, innovation lost much of its social charm and got a distinctly commercial character.
Actions/solutions implied: Implications for policy: At the policy level, the emergence of new mediation mechanisms require a policy that takes a leading part in making new forms and patterns of innovations more visible and eligible for funding as well. Accordingly, there is the need for more coordination between different policies and policy levels along with efficient and effective governance (multi-level governance). This holds especially true when we call for more systemic innovations. Policy coordination must be enforced and aligned with various instruments from different policy realms. Therefore, a new form of system-integrator for systemic innovations is required and non-engineering, non-natural science competencies from the humanities should be included in the innovation process. At the regional and urban level, policy has to consider whether or not to play a much more active role as a proactive mediator.
Policy should enable all actors to participate and avoid exclusion. In addition, policy should initiate projects with new formats involving very different actors from many realms. For example, if individuals (laymen, citizens, users) or groups of individuals organise themselves into innovation camps and become eligible for funding, new target groups for RTI policy come into focus. Existing policy measures that address innovation management and coordination activities via projects, advice, services and platforms would receive new focus and spin. It would also become more complicated if companies and individuals were eligible for the same funding.

Implication for companies: New mediation mechanisms offer both threats and opportunities for companies. Realising new opportunities requires a better understanding of the behaviour and roles of new actors external to companies but occasionally from within. Companies should understand the rules of new mediation forms such as platforms, virtual communities, citizens’ communities, etc. There is the risk that companies will not be able to exploit these opportunities due to a lack of competency required due to the limitations of their respective corporate cultures. Ideally, large companies should monitor development regarding new ways to organise the innovation process and define strategies for how to respond to new situations. Traditional industries, for instance, can learn from the software industry and how established software companies responded to the open source software development trend. Typical business strategies involve offering services such as training or the development of tools that enables the development of products within a community (e.g. user toolkits) or the establishment of an online platform.
Who benefits from the actions taken?: European society in general.

Meta information

Time horizon: 2025
Methods: Literature review, Scanning, Workshops, TEEPSE analysis, Weak Signals analysis, Brainstorming, Expert Panels, Conferences
Target Group: European Commission - DG Research & Innovation, policy makers, interest groups, companies, researchers
Objectives: The had teh following 5 objectives presented in the form of research questions: (1) What are the most likely patterns for how innovation will be organised in the future?; (2) What are the implications of new innovation patterns for the economy, society, and the environment?; (3) How do major socio-economic factors such as demographic changes, environmental threats, and urbanisation affect the likely development of the European innovation landscape?; (4) What are the implications for frameworks conditions (such as Intellectual Property Rights)?; (5) How could policy makers, interest groups, and companies exploit the potential and reduce the risk associated with new innovation patterns?
Countries covered: Austria, Germany, Belgium, however the project looked at innovation patterns in developed, emerging and developing countries too.
ERA actors/stakeholders mentioned: European Commission, DG Research & Innovationa nd several research and technology organisation (RTO) in Europe and the world
Keywords:
Geographic scope:

Entry Details

Rapporteur: Rafael Popper
Rapporteur's organization: UNIMAN
Entry Date: 01.06.2012