[Book review] Innovation and collaboration for a harmonious world

The book "Innovation and collaboration for a harmonious world" is written by the Dr. Johan Wallin (Finland) and Professor Jun Su (China) and discusses different themes around innovation policy, competitiveness, clusters and global trends and challenges. Besides the potential for collaboration between the two countries and many different examples of clusters and business development within each country, several statements about innovation policy and cluster development I considered worth quoting or summarising:

...in the knowledge society, competitive advantage of individual products or services is not sustainable for very long periods of time. Individual offerings provide superior profitability just for a certain period, after which competition will catch up, and no advantage ca be sustained. Because of this, the only way to be economically successful is by having the capacity to constant innovate." (p 19)

About innovation

Three different types of innovation activities are distinguished:

1) Cost innovation; cost-effective, standardized operations, improving supply-chain operations.

2) Offering innovation; capacity building and collaboration with customers and partners for developing new offerings by integrating the contributions of partners, so that individual companies cannot match on their own

3) eco-system innovation; considering partner portfolio and forming the social architecture for long term collaboration and innovation

Eco-innovation, the book claims, is today the most essential factor the drives growth.

Eco-innovation can be pursued through two different options: Strategic Niche Management (bottom-up evolutionary approach) and Orchestra manager (top-down approach). The first approach is based on the socio-technological system approach developed in the Netherlands and which views:

...the whole complex of scientific knowledge, engineering practices, production process technologies, product characteristics, skills and procedures, established user need, regulatory requirements, institutions and infrastructures.

The different types of innovation also required different types (levels) of collaboration

About Collaboration

The book also discusses different stages in the development of collaboration, described in the light of the earlier mentioned different types of innovation. Since eco-system innovation demands a different level of collaboration, the different levels of collaboration are introduced:

1) Mapping the context (a new worldview)

2) Engaging customers (new segmentation

3) Offering repositioning (reconfigured resources)

4) Institutionalising collaboration (cemented partnerships)

5) Ecosystem orchestration (co-specialised capabilities)

The book further notices the important role of clusters in innovation policy.

About Clusters

A Cluster develops according to Wallin and Su in the following four steps:

1) Chance: The accidental event that initiates a change. This could be a single vision of an influential person

2) Strong individual: a small number of strong and influential individuals are attracted to the region, or start working on a long term cluster idea, and are able to attract more talented people.

3) Obtain concrete results: the small group of talented people have to reach concrete results that will attract not only other people but also business

4) Institutionalisation: Reach critical mass in which the cluster is not dependent on several individuals but is institutionalised and has enough critical mass to further attract people and business and continue to grow and develop.

Unfortunately, only one example of a cluster is described, on which bases these four stages of development seemed to be based. The book also notes that no cluster in Finland has been developed on initiative of the national authorities.

Country Development

The authors further distinguish different levels of development at country level, from the perspective of innovation.

1) Resource oriented country: Mainly development countries. Depending on their natural resources, few means to develop an eco-system, but could benefit most from 'grand challenges' innovations

2) Investment oriented country: Country is investing in equipment, technology, develop new technology, focus on IPR. Country promotes direct investments as a means to increase competitiveness. Country can be included in eco-system due to possession of some key technologies

3) Innovation oriented country: Service economy, knowledge intensive and focus on new knowledge and innovation. They might be natural orchestrators of eco-systems because of capabilities to design, and develop multi-cultural networks

4) Sustainability oriented country: Social and Environmental policies are integrated into innovation policy for the wellbeing of people and nature. Focus on employment, education, health, housing, eldery care, medicine as well as a focus on long term issues regarding wellbeing and environment. These countries see opportunities in the grand societal challenges to develop new innovative solutions and bring these forward on the global agenda.

The authors note that China is somewhere between a resource and investment oriented country, aiming to become an innovation oriented country, while Finland is at the moment an innovation oriented country and and aims to become a sustainability oriented country.

Another noticeable issue raised by the authors is that national innovation policy that supports global, innovative and competitive sectors/clusters/firms should take into account that global champions operate at global level (see eco-system). Much of the support for these global champions (either direct, or through sector/cluster support) might therefore create overspill effects to the global level and not necessary create more jobs in the country. This raises issues about the justification of national innovation policy. The role the authors see for national (and regional) authorities is the guidance in the forming of networks at global level that will benefit the national champion(s).