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Unlocking Innovative Places

August 1, 2023

Report
Place
Business Innovation/Diffusion
Eco-System

Published by

Dr Jen Nelles

Originally published as part of the Innovation Caucus.

This article discusses the following reports: Place Based Innovation Policy Synthesis Report and the accompanying Place Based Innovation in the UK: Case Studies

From the Innovation Strategy to the Levelling Up White Paper, place is at the heart of Government policy. The Government’s new Geospatial Strategy 2030 is the most recent publication outlining the role of the private and public sectors in cementing the UK’s position as a global science and technology superpower and delivering economic growth. These strategies recognise that the future competitive advantage of the UK is contingent on empowering the growth of towns, cities, and regions. This in turn has led to a strong focus on clusters and place-based innovation strategies.

The 2022 Understanding Cluster Growth Potential report for Innovate UK proposed and piloted a framework to identify and assess the growth potential of place-based innovation, and included a set of 3 case studies (marine and maritime in the Solent, cybersecurity in Belfast, and medical technologies in the East Midlands). In the latest reports, Part 1: Place Based Innovation Policy: Synthesis Report and the accompanying Part 2: Place Based Innovation in the UK: Case Studies, we expand the evidence base with nine new cases exploring the dynamics of place-based innovation in sectors that Innovate UK considered to have growth potential.

The nine case studies* include examples of both established industries adopting new technologies in innovative ways, and nascent industries developing around novel technologies. Applying the framework to different places provides insights about their innovation potential, as well as what kinds of support would best accelerate growth in each of the case studies.

  • Eastern England agritech
  • Northern Ireland agritech
  • Scottish Highlands & Islands blue economy
  • Great South West blue economy
  • Yorkshire healthtech
  • Wales medtech
  • East Midlands energy and propulsion
  • North West advanced materials
  • Gateshead and Newcastle immersive technology

Common insights on place-based innovation

These case studies provided valuable insights about the growth potential of industries in the nine places. But taken together they provide important insights about common challenges and patterns associated with place-based innovation in the UK. These include:

  1. Not  all innovative places are clusters – Most of the cases that we investigated did not fulfil all of our criteria to be considered clusters. Some are evolving clusters, while others might be parts of clusters organised at different scales and geographies. Public policy and innovation support have a role to play in helping to fill gaps and magnify strengths.
  2. Enabling technologies are catalysing innovation – Across our cases, technologies like AI, automation, remote sensing (using sensors or satellites), and digital/big data data analysis were being used by the most cutting edge firms to open new markets and drive innovation.
  3. Knowledge exchange happens at different scales – While much of the conventional wisdom on place-based innovation focuses on the importance of local knowledge generating assets, it is important not to neglect the importance of external knowledge pipelines.
  4. Leverage innovation gains from globally connected anchors – Globally connected firms and research institutions can generate important knowledge spillovers, and connect local firms to an international marketplace of ideas. However, sometimes places struggle to effectively capitalise on these assets to fuel local innovative industries.
  5. Innovation  is increasingly demanding common skills across places and sectors – Digital, engineering, and management skills topped the list of most demanded skills across all cases and places. Since labour markets are not highly localised this suggests that a national approach to address these specific gaps could provide broad stimulus and reduce labour-related constraints to innovation-led growth.
  6. The scale of engagement is key to the success of convening and coordinating organisations – Stakeholders across cases saw the value of convening and coordinating organisations to represent the community and chart strategies for collective development. However, few had actually developed leadership at the scale of our analysis. This pattern should provoke consideration from both local stakeholders and policymakers about the advantages of convening different configurations of industries at different geographical scales and a recognition that multiple scales and identities may be able to coexist.
  7. Longer term funding is needed to fill gaps in private finance – Most of the industries studied here reported a need for funding that enables firms to complete much longer innovation cycles than public resources typically cover. This is particularly the case in areas of innovation that are too risky or long term for private markets.
  8. National agendas and social change drive innovation – All of the industries we studied were also in the process of responding to the challenges of climate change. While this has created challenges, it has also increased opportunities for innovation in transitioning to Net Zero but this duality could be better supported.

Catalysing place-based innovation

Innovation policy in the UK has developed a renewed interest in place. Central to this is understanding the presence of innovation assets, as well as how they can be both connected and mobilised. This represents a new challenge for many places, since the research and innovation system has long since been organised and orchestrated nationally. Our framework provides a means to instigate that self-reflection and critical appraisal and the case studies begin to evidence a range of localised innovation dynamics. However, empowering innovation-led growth across the UK’s towns, cities, and regions is not simply a local challenge, it requires the policy nexus with Whitehall to be enabling and aligned. Given the place-based focus and brokering role of Innovate UK, the national innovation agency provides an important catalyst to innovation-led growth in towns, cities, and regions across the UK .

 

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