Kreo tn2 Karlsruhe, Rhône Alpes, Emilia-Romagna and Oxfordshire Thematic Network for the Support of Innovative Companies

4.2R&D and innovation scoreboarding

When considering quantitative information on EU, member states and EU regions performances as regards innovation, the main and wider source available for all these dimensions is the European Innovation Scoreboard⁹ which represents a valuable tool to assess performances relating to innovation on a yearly basis. The European Innovation Scoreboard includes 17 main indicators covering four different topics:

• 
  Human resources for innovation
  
• 
  Creation of new knowledge
  
• 
  Transmission and application of knowledge
  
• 
  Innovation finance, outputs and markets
  

A great effort has been made in the 2003 report to further develop the regional dimension of the assessment, the main reason being that innovation policies are often developed and implemented at a regional level.¹⁰ Therefore, this tool is particularly valuable for all actors involved in innovation and, in particular, it enables policy makers to identify strengths and weaknesses and consequently to design new policies and assess, in the medium to long run, policy implementation.

Performances of the four KREO regions will be first assessed on the basis of:

• 
  Human resources for innovation
  
• 
  Creation of knowledge
  

Following this, the overall innovation performances of the KREO network will be analysed on the basis of the results of all 13 re-scaled European indicators values collected and the results of the Revealed Regional Summary Innovation Index..

4.2.1Human resources

Four different indicators have been collected in the framework of the Regional Innovation Scoreboard:

1.2 Population with tertiary education (% of 25 – 64 years age class)

1.3 Participation in life-long learning (% of 25 – 64 years age class)

1.4 Employment in medium-high and high-tech manufacturing (% of total workforce)

1.5 Employment in high-tech services (% of total workforce)

Table 2 - Innovation scoreboard : Human resources

	Year	De12 Karlsruhe	Fr71 Rhône-Alpes	it4 Emilia-Romagna	ukj South East	EU15 European Union
Tertiary education	2002	24.02	26.98	11.77	33.78	21.78
Lifelong Learning	2002	6.36	2.87	6.37	24.11	8.52
Med/hi-tech employment in manufacturing	2002	16.39	8.63	10.41	7.28	7.41
High-tech employment in services	2002	4.74	3.89	2.85	6.25	3.57

Source: 2003 European Innovation Scoreboard
It has to be observed that none of the four indicators referring to human resources sees all four KREO regions above the EU mean, even if all regions show different strengths and weaknesses.

Karlsruhe shows a particularly high level of employment in manufacturing with a medium and high technology content, as it represents 16.39% of total work forces. Karlsruhe is indeed the 5^th region in EU in terms of proportion of workforces employed in medium and high-tech manufacturing. Karlsruhe has also strengths in terms of the proportion of the population with a tertiary education (24.02% of the population of 25 to 64 years age class against the EU mean of 21.78%), and in terms of employment in high tech services (4.74% of workforces against 3.57 in the EU), but shows a low level of participation in life-long learning (6.36% of the population of 25 to 64 years age class against the EU mean of 8.52%).

Rhone-Alpes shows strengths in three specific areas, that is: the proportion of the population with a tertiary education (26.98%) and also both the employment in medium high tech manufacturing and services (respectively 8.63% and 3.89%), whereas the participation in life-long learning is well below the EU mean (2.87% of the 25-64 years age class against 5.52% at an EU level).

Emilia-Romagna shows a particular strength as for the indicator regarding the employment in medium and high technology manufacturing (10.41% of Emilia-Romagna workforces is employed in medium high-tech industries). The proportion of employment in medium high tech services is on the contrary a little below the EU average (2.85% versus 3.57% at the EU level). Lifelong learning is fairly diffused in Emilia-Romagna even if it is lower compared to the EU mean of 8,52% (6.37% of the population between 25 and 64 years old participate in lifelong learning). The main weakness in Emilia-Romagna is however represented by the proportion of the population with a tertiary education being 10% under the EU mean (11.77% of the population of in the defined age class versus 21.78% in the EU).

In the South East of England, particular strengths regard the level of education and training. Indeed, 33.78% of the population in the age class has a tertiary education and 24.11% of this population participates in life long learning courses which represents a particularly important proportion as the South East region ranks second at an EU level for this particular indicator. Another strength is represented by the employment of workforces medium high tech services (6.25% of workforces), the proportion of employment in medium high tech manufacturing being however below the EU mean.

4.2.2Creation, transmission and diffusion of knowledge

Four different indicators have been collected in the framework of the Regional Innovation Scoreboard:

2.1 Public R&D expenditures (% of GDP)

2.2 Business expenditures on R&D (% of GDP)

2.3.1 EPO high-tech patent applications (per million population)

2.4.1 EPO patent applications (per million population)
Table 3 - Innovation scoreboard: Creation of knowledge

	Year	De12 Karlsruhe	Fr71 Rhône-Alpes	it4 Emilia-Romagna	ukj South East	EU15 European Union
Public R&D	1999	1.46	0.73	0.46	0.78	0.68
Business R&D	1999	1.89	1.55	0.50	2.49	1.30
High Tech patent applications	2001	56.3	42.3	5.6	74.6	31.6
Patent applications	2001	492.9	243.6	176.7	233.2	161.1

Source: 2003 European Innovation Scoreboard
In terms of creation of knowledge, most KREO regions show all indicators well above the EU mean.

As regards Karlsruhe, strengths are in all four indicators and, in particular, the proportion of EPO patent applications as compared to the population is particularly high (492.9 applications per 1 million inhabitants against 161.1 at the EU level). Level of high tech patent applications is also high (56.3 applications per million population against 31.6 at the EU level). The proportion of public (1.46%) and business (0.73%) expenditure in research and development activities as compared to regional GDP is also well above the EU mean.

Rhone-Alpes has specific strength in all four indicators collected. In particular, the proportion of both high tech and EPO patent applications in general are well above the EU mean if compared to the population size (in 2001, 243.6 EPO applications per 1 million inhabitants of which 42.3 for high tech products). The public and business expenditure in R&D as compared to GDP dimension is also above the EU mean (pubic expenditure in R&D represents 0.73% of GDP in Rhone-Alpes – against 0.68 at the EU level and whereas business expenditure in R&D represents 1,55% of GDP against 1.30 at the EU level).

Emilia-Romagna shows weaknesses in three indicators. Only as regards EPO patent applications, the region shows a number of applications, as compared to the population size, above the EU mean (176.7 applications per million inhabitants). The proportion of high tech patent applications is however well below the mean (5.6 applications per million inhabitants against 31.6 at the EU level). This shows that patenting in the region is developed, especially if considering the Italian patenting level, being Emilia-Romagna the region with the highest number of EPO patent applications in Italy if compared to the population, however patents are related to sectors with a low or medium technology content. Results in terms of expenditure in R&D are also well below the EU average, in particular as regards expenditure made by businesses (public expenditure represents 0.46% of GDP whereas business expenditure represents 0.50% of GDP).

South East England shows records in terms of all four indicators well above the EU mean. In particular, strengths are in the expenditure dedicated to R&D (0.78% of GDP for public expenditure and 2.49% for business expenditure). Other strengths can be found in the number of high tech patent applications (72.6 applications per million inhabitants) as well as, to a smaller extent, to EPO patents in general (233.3 applications per million inhabitants).

4.2.3Overall regional innovation performance

One important progress made in the 2003 Regional Innovation Scoreboard is that the analysis has been widely enlarged and made more dynamic.

In particular, the 13 collected indicators have been re-scaled according to regions’ positions in their own country.

In addition to the indicators mentioned above, the following re-scaled indicators have been calculated:

CIS1 Share of innovative enterprises (% of all manufacturing enterprises)

CIS2 Share of innovative enterprises (% of all services enterprises)

CIS3 Innovation expenditures (% of all turnover in manufacturing)

CIS4 Innovation expenditures (% of all turnover in services)

CIS5 Sales of ‘new to the firm but not new to the market’ products (% of all turnover in manufacturing)

In addition to those re-scaled indicators, a specific index has been calculated: the Regional National Summary Innovation Index¹¹ that represents the average value of regional data for each specific country.

Table 4 reports performances of the four KREO regions for the various indicators.

Table 4 - Re-Scaled indicator values and RNSII

	1.2	1.3	1.4	1.5	2.1	2.2	2.3.1	2.4.1	CIS1	CIS2	CIS3	CIS4	CIS5	RNSII	RNSII rescaled
DE12	0.34	0.47	0.71	0.85	0.80	0.41	0.19	0.58	0.91	0.50	0.13	0.35	0.56	0.53	0.77
FR71	0.60	0.51	0.43	0.40	0.32	0.63	0.52	0.78	0.88	0.76	0.87	0.43	0.50	0.56	0.65
IT40	0.79	1.00	0.76	0.35	0.33	0.37	0.28	1.00	0.70		0.60		0.33	0.60	0.90
UKJ	0.59	0.90	0.60	1.00	0.92	0.78	0.78	0.87	1.00	0.45	0.47	0.25	1.00	0.76	1.00

Source: 2003 European Innovation Scoreboard
As it is shown by the re-scaled RNSII, all four regions show to be regional leaders in their countries. In particular, South East England is the first ranked region in the UK regards overall innovation performances. More specifically, South East England is national leader in terms of Employment in high-tech services, share of innovative enterprises and sales of new products and very well positioned for almost all other indicators.

As a whole, Emilia-Romagna is ranked third at Italy-wide just after Lombardia and Piemonte. As regards specific leadership, the region is first ranked as regards Participation in life-long learning and EPO patents applications. Performances of Emilia-Romagna are also quite high as regards human resources indicators in general and also as for indicators linked to innovative enterprises and their expenditure in innovation.

Rhone-Alpes is the third ranked region in France just after Iles de France and Midi-Pyrénées even though, as regards specific competencies per single indicators, Rhone-Alpes assumes no leading position even if its performances are high in almost all indicators and, in particular, strongest points are linked to the transmission and application of knowledge (i.e. innovative manufacturing enterprises as well as innovative enterprises in services and also expenditure in innovation). Other strengths are linked to EPO patent applications and Business expenditure in R&D.

As a whole, Karlsruhe is ranked 4th at a Germany level just after Oberbayern, Berlin and Stuttgart. The region is well positioned as regards almost all indicators and in particular, strengths regard Share of Innovative Enterprises, Public R&D expenditures and Employment in high-tech services. Weaknesses are related to expenditure in innovation in manufacturing enterprises and also EPO high-tech patent applications.

Table 5 - Summary: KREO regions strength and weaknesses in innovation indicators performances

	STRENGTHS	WEAKNESSES
KARLSRUHE	Particularly high presence of medium and high tech manufacturing sectors. Relatively large employment in High Tech services. High expenditure in R&D activities (both from the public and business sectors). Particularly developed patenting especially as regards high tech sectors.	Participation in lifelong learning is quite low. Expenditure in innovation is relatively low if compared with the other German regions both for manufacturing and service sectors.
RHONE ALPES	The proportion of the population with a tertiary education is well above the EU mean. Patenting very developed especially as regards high tech sectors. Innovation in businesses is well diffused (in terms of share of innovative enterprises as compared to the number of manufacturing companies and of services companies as well as concerning innovation expenditure).	Participation in lifelong learning is well below the EU mean.
EMILIA-ROMAGNA	High presence of medium and high tech manufacturing sectors in terms of employment of the regional workforces. Relatively high level of patenting especially if compared to the other Italian regions. Diffusion of innovation in the manufacturing sector is quite high if compared to the other Italian regions.	The proportion of the population having a tertiary education is well below the EU mean. Participation in lifelong learning is well below the EU mean even if the region is first ranked at Italy’s level. Expenditures in R&D are below the EU mean, particularly the Business ones. Low level of patents in high tech sectors.
SOUTH EAST ENGLAND	Proportion of the population with a tertiary education is very high. Participation in lifelong learning is particularly diffused. Employment in high tech services is among the highest in the EU. Expenditure in R&D especially as regards the business sector is extremely high. High tech patenting is also very high. Sales of new products are the highest in the country.	Employment in medium and high tech industries is relatively low if compared to the EU mean.