Innovation policy needs to be more like innovation

The innovation that matters most differs between sectors. Obvious really, but it’s easier to recognise than it is to design policy for.

NESTA’s new research report, Hidden Innovation, examines six sectors that, at least according to traditional measures like R&D, have low rates of innovation. But sectors such as oil production and construction do innovate, just in different ways. In oil production, innovation is the development and application of technologies in the field. In construction, it’s more about the adoption of new working methods and materials. Neither form of innovation is based primarily on university or corporate lab research which is then applied and commercialised – the so-called linear model of innovation.

The new policy agenda for innovation – developing approaches that stimulate and support the different forms of innovation that matter in different sectors – will need a new approach to policy development. In effect, in the past we have relied on a linear model for policy development: do some research (privately); analyse the results; develop and launch a pilot programme; evaluate the impact before deciding whether to roll-out as a full ‘product’.

Much innovation in industry no longer works in this way. It’s collaborative, interactive, incremental, experimental, open. Not words usually associated with policy development, let alone politics.

At the event to launch the NESTA research, Alistair Darling, Secretary of State for Trade and Industry (and possibly the next Chancellor of the Exchequer) announced the intention to form ‘sector innovation groups’ with industry partners (and NESTA) to discuss and develop new policies to support innovation in service sectors of the economy. [You can watch his speech here] Does this approach – potentially innovative in itself - represent the future of policy development for innovation?

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