The 2018 World Competitive Report confirms that as the 4th industrial revolution is taking form, new factors determine your business competitiveness. Human capital, innovation, financial resilience and creative agility are now defining features for economic success. In addition, one can no longer invest in just one pillar of competitiveness (e.g., investing in technology) instead one needs to take a holistic approach, taking all the factors into account. A strong performance in one driver of productivity cannot make up for a weak performance in another.
Let’s take a closer look at the “Innovation Capability” pillar, a widely considered engine of economic growth. But many countries (and companies) are struggling with incorporating it in a meaningful way. With only a median score of 36 (out of 100), it has the lowest average performance in comparison to the other 11 pillars of competitiveness.
The 3 powerhouses
When we compare countries’ innovation capability, only 3 powerhouses pop up:
- Germany (87.5/100)
- USA (86.5/100)
- Switzerland (82.1/100)
They are even considered statistical outliers. Three quarters of the 140 countries are not even halfway the frontier (scoring 50 or less).
To measure the Innovation Capability of a country the World Economic Forum surveyed 10 innovation components.
- Diversity of workforce
- State of clusters development
- International co-inventions
- Multistakeholder collaboration
- Scientific publications
- Patent applications
- R&D Expenditures
- Research institutions prominence index
- Buyer sophistication
- Trademark applications
The Innovation Challenge
Innovation is an incredible challenging and complex process. It starts in people’s mind with the generation of ideas. Many of them don’t even see day light. Some lead to inventions, but only a few are ever successfully commercialized. Innovation takes place within an ecosystem of multiple factors. When a factor is missing in this ecosystem, it can prevent new ideas from being generated or evolving into viable commercial products.
Written by: Brain & behavior expert, Dr. Nicole Van Hoeck