Hidden innovation
Author:
NESTA
Year published:
June 2007
Download:
Hidden Innovation Report 430KB
Description
Innovation is essential to ensuring the UK's future economic competitiveness and social wellbeing. But in our October 2006 report The Innovation Gap, we identified a gulf between how innovation happens and how policy supports it.
Hidden Innovation attempts to bridge this gap by analysing the innovation systems of six sectors that are seen as having low levels of innovation: oil production, retail banking, construction, legal aid services, education and the rehabilitation of offenders.
It examines whether these sectors are truly lacking in innovation, or whether traditional measures of innovation - such as investment in R&D - are failing to capture all of the innovation that takes place.
Recommendations
The report demonstrates that the innovation that occurs in these sectors is often excluded from traditional measurements. In oil production, for example, the development of new technologies in oil exploration is a better measure of innovation than spending on R&D.
The construction industry patents few new inventions, but efforts to modernise construction methods across the sector have already saved more than £800 million in central government procurement alone.
To address this problem, the UK should develop an Innovation Index that is tailored to the ways in which innovation takes place in different sectors. By capturing both traditional and hidden innovation, the Index would produce a better 'health-check' of innovation.
Innovation policy needs to be sensitive to existing systems of innovation already at work. Only industry can provide this in-depth understanding, so it is essential that industry groups work alongside government to achieve this goal. It is also important that innovation is championed at a high level within government.
Impact / Benefit
By understanding the dynamics of innovation in different sectors, government will be better able to use regulation, taxation, procurement and education policy to ensure that the right conditions for innovation are in place.
If we can successfully bridge the gap between how innovation happens and the policy that supports it, the UK will be in a stronger position to achieve high-performing public services, world-class industries and an international reputation for innovation.