Innovation is the foundation of a region’s capacity for achieving sustainable growth through the creation and application of new ideas. The innovation process, though not linear, can be usefully divided into three phases: Idea Generation, Idea Development, and Commercialization.
Wealth creation starts with an idea, whether it is formed in a state-of-the-art research facility or in a neighbor’s garage. A region will sink or swim based on its ability to capture and develop the innovative ideas of its residents and industries. Read about idea generation metrics.
The second step in the innovation process is idea development. Ideas can be generated in virtually any setting, but the development and testing required to turn an idea into a new product or service require structure and resources. Software, for example, can be tested relatively cheaply and quickly with enough willing users and available equipment. In other fields, such as life sciences, the process is much longer and requires considerable investment to get products to market. Pharmaceutical companies take over a decade to develop a new drug before it reaches the market. Partnerships between industries and universities can accelerate the product life cycle and should be evaluated when analyzing this stage of the innovation process. Read about idea development metrics.
For tested ideas to benefit a region in terms of economic development, they must be translated into new products and services through the commercialization process. Economic developers can nurture commercialization in a region by using strategies that create strong networks between researchers and companies, and by supporting innovation within existing firms. Examples include: business incubators; industry association sponsorships of research groups at universities; or even setting up networking events where university representatives and companies can exchange ideas and share news about local R&D projects. Read about commercialization metrics.
Measuring the three phases of innovation is not a simple task. More metrics exist for the earlier stage of the process. Patent data is relatively easy to obtain, however data about new products or services being tested or sold is much more difficult to gather, particularly when the innovation is being undertaken by private firms that need not publicly report financials. Still, it is possible to at least indirectly measure the aspects of the entire innovation “pipeline.”
NEXT: Go to a Output Metrics public sources table
Or, back to Output Measures of Innovation Capacity
Or, back to Appendix