We struggle to innovate...! Some relative strengths and weaknesses in the case of Spain
Spain is a “Moderate Innovator” ranked 14th among EU countries and 18th among all European countries considered in the annual EIS report. It shows an innovation index of 89.9% of the EU average, slightly above the average of “Moderate Innovators”
Growth since 2017 is positive at 9.4% but lower than the 10% EU average.
We will see some strong points in the development of Spain's innovation index from 2017 to 2024, as well as its relative weaknesses, and which are the real barriers to the growth of the innovative economy.
Analysing Spain's position in the 12 innovation dimensions of the EIS, we obtain the results shown in the following table.
The table only refers to EU countries, but it helps us to see and establish the determining factors of a country's position, in this case Spain's.
We see both the positioning in the ranking and the relative values of the index with respect to the EU average and the evolution since 2017 in the 12 dimensions on which the 32 indicators with which the EIS establishes the ranking are based.
The colours indicate the position that Spain would occupy in each ranking based on the index value in each category.
As we have seen, Spain is ranked 14th out of the 27 EU countries, two below the average, and its relative innovation index is 89.9 with a growth of 9.4% since 2017. (The EU average is 10%).
Strengths:
We can immediately see (green figures and index values above 100) that digitalisation, human resources (within the “Framework Conditions” area) and financing (in the Investments area) are really the only strengths that make the index advance. With Environmental Sustainability and the impact of innovation on sales, there is some progress in the position, but still with values below 100.
We deduce that the “framework conditions” area for innovation is a strong point. There is still room for improvement in the area of 'attractive and effective research systems', where progress has been made by 11.9%, but it still requires an effort for researchers to find their opportunities and attractive positions in the country, not only in public research systems, but above all in the R&D of companies and the private sector.
On the other hand, it should be noted that both human resources and the digitalisation infrastructure are sufficiently prepared to achieve more brilliant results.
Regarding the area of Investments, the 28.8% advance in financial support in recent years stands out, which would currently place the investment dimension among the highly innovative countries. But the Investments area is spoiled by the lack of business investments, which are at the level of “emerging innovators” and with a relative index of only 61.8%
It is also worth highlighting the contradiction of having a digitalisation index of 144.9% relative to the EU average, and a 'use of new technologies' of only 89.3%, and very low growth since 2017 of only 1.9%.
Weaknesses and barriers to innovation
We have already seen 3:
But the real barriers are yet to be pointed out:
???????? A general failure in the “Innovation activities” area. Especially in the field of SME innovation, at a level of 53.6%. Bearing in mind that this is more serious, given that large companies are mostly international and the decision-making centres are not here.
???????? SMEs need to introduce innovations in specialised segments with added value, in their products and services, or within their organisations, such as in business processes.
???????? More collaborative efforts between innovative companies, collaboration in research between the public and private sectors and job-to-job mobility in Human Resources in Science and Technology (HRST).
???????? Improving the application of intellectual property rights (IPR), patents, trademark applications and proprietary designs.
Finally, I would like to emphasise that in the last of the main categories or areas, that of “impacts”, little progress can be made if there is no real improvement in the previous ones, because it is really the fruit or consequence of the actions in the first 3 areas.
There is room for improvement in the external networks for export marketing and in the internationalisation of business activities, always with the support of the strong points.
And above all, we should consider the potential impact of improvement in employment that innovation can have, in an economy with structural unemployment.
New on the topic of "startups".
For the first time, the European Commission is publishing, together with the EIS, a Feasibility Study, European Startup Scoreboard with the idea of establishing a future European EIS for startups.
For now, it is limited to the study of an integrated system of definitions and analysis framework, for a future European comparison or ranking of startups. It analyses:
???????? The European Startup ecosystem
???????? The lack of coherence in definitions
???????? International information sources
???????? Most commonly used indicators
???????? Definitions and indicators in the EU
???????? Country profiles
???????? Definition tables
·?????? Tables on startups
·?????? Tables on scaleups
·?????? Tables on entrepreneurship led by women
The main conclusion of this feasibility study is that the key concepts analysed do not have, to varying degrees, definitional coherence, and some are not even defined in most sources.
While some definitions opt for a simple definition, with fewer elements and that would encompass a larger number of companies, others do so with most of these elements and considering a more limited number of companies.
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On the other hand, concepts such as startup ecosystem, innovative companies, scaleups, deep technology startups, unicorns and spin-offs vary less from a definitional point of view. Definitional differences are also found with respect to these concepts, but they are not substantial. Regarding indicators, the feasibility study identifies considerable variation in how the performance of a startup ecosystem and other related concepts are measured in different reports.
However, two objectives stand out:
1.???? Develop a complete list of existing definitions, highlighting the most relevant agreements and disagreements and how to define the different elements in a unified way.
2.???? Identify the most common indicators to evaluate the performance of the startup ecosystem.
Both objectives could lay the foundations for creating a European Startup Scoreboard.
Some data and figures collected in the startup report:
???????? The UK, Sweden, Germany and France are in the top 10 globally in terms of startup ecosystem.
???????? The top cities in terms of seed investments are London, Paris, Stockholm, Berlin and Barcelona.
???????? Considering scaleups only, according to the European Scaleup Monitor 2021, the top three scaleup countries are the UK, France and Germany. The UK and France host around 300 scaleups, while Germany hosts around 86;
???????? The top scaleup cities are London, which has 145 scaleups (representing 15% of UK scaleups), Paris, with 50 scaleups (representing 17% of French scaleups) and Stockholm, with 26 (representing 47% of Swedish scaleups).
???????? The number of European cities that own a unicorn is increasing: while only seven cities hosted a unicorn in 2010, this figure rose to 65 in 2021.
???????? As for high-tech companies, the highest values of venture capital investment between 2015 and 2020 can be found in the UK, Germany, France and Sweden.
???????? On the other hand, the highest proportion of venture capital invested in deep tech is found in Norway, Finland, Belgium, Austria and Poland.
In a future article we will summarize the latest reports on our European and global startup system. (See Images)
Innovation by EU territory: RIS 2023
The Regional Innovation Scoreboard complements the EIS and, in my opinion, regional analyses greatly help to understand the development of innovation. Innovation is often grouped into regional or topic-specific clusters and the view of regional development is important as it provides more precise information.
Generally, the most innovative regions tend to be in the most innovative countries. However, regional "pockets of excellence" can be identified in several moderately innovative countries (such as the Prague region in the Czech Republic, the Basque Country in Spain, Emilia-Romagna in Italy and Budapest in Hungary) and also in emerging innovators (such as Grad Zagreb in Croatia, Warszawski Stoleczny in Poland, Bratislavsky Kraj in Slovakia and Belgrade in Serbia).
Results by EU region
The most innovative region in Europe is Hovedstaden in Denmark, followed by Helsinki-Uusimaa in Finland, Oberbayern in Germany, Stockholm in Sweden and Berlin in Germany. See table: the 25 regions with the highest innovation index: [
[1] For more details see the full report:
As with countries, regions are grouped into four groups by innovation index:
???????? The Innovation Leaders group includes 36 regions.
???????? The Strong Innovators group includes 70 regions.
???????? The Moderate Innovators group includes 69 regions.
???????? The Emerging Innovators group includes 64 regions.
With a total of 239 regions, the RIS obtains a more detailed breakdown of these groups by dividing each into three subgroups, with the highest index subgroup assigned a '+', and the lowest subgroup a '-'.
The most innovative regions will be 'Innovation Leaders +', and the least innovative regions will be 'Emerging Innovators -'.
This more detailed breakdown helps to better capture the diversity in the performance of regional innovation systems. For example, 11 countries have regions in four or more distinct development subgroups. The chart shows:
Changes in regional indices from 2016 to 2023.
Performance relative to the EU average has declined in 113 regions, including all regions in Bulgaria, France, Ireland, Romania and Slovenia. For 28 regions, across nine countries, performance has declined over time, with the majority of regions located in France (12), Switzerland (4) and Germany (4).
See the summary chart, according to % growth (green) or decrease:
Apart from the highly innovative regions, the increase in the index is notable in the regions of southern Europe (mainly Greece and Italy), with the exception of Spain and Portugal.
The decrease in the French regions is also notable, with more than 12%.