Innovation in Services - Department for Business, Innovation and Skills

Introduction
Policy designed to meet innovation needs across the economy is arguably the
best approach, particularly in light of the increased blurring between different
activities in the economy. Van Ark et al (2003) 35 argue
‘...given the increased intertwining of service and manufacturing
innovations the distinction between separate innovation systems for these
two sectors also seems inappropriate. Instead of focusing policies
specifically on sectors or individual functions, the appropriate approach is
to recognise perceived innovation problems where the supply of and
demand for innovations do not match...’
Similarly, Tether (2005) 36 notes that while services tend to have an orientation to
innovation that differs from manufacturers, this difference shouldn’t be
overstated – noting that there are a variety of modes of innovation found in both
services and manufacturing. He concludes by noting that we still know much
less about innovation in services, and that what is important in thinking about
innovation is not which sector they belong to but which approach to innovation
they use.
The Council for Science and Technology also warn against adopting a separate
model: 37
‘...we are not convinced that it would be helpful to maintain a distinction
between services and manufacturing innovation and to develop a separate
model for service innovation [...] the growing interdependence of service
provision and manufacturing suggests to us that it would be better to aim
for models which look at how value is added without imposing a priori
division between manufacturing and services. [..] Maintaining the divide
may simply stall discussion.’
In line with the ‘emerging’ nature of academic study of services innovation,
international policy evidence on services is also being developed. Forfás (2006)
from Ireland are one of the few Government agencies pursuing a distinctive
service and innovation policy. Forfás argue: 38
‘...merely re-branding or repackaging of policy and supports will not be
enough. Although it must be understood that many of the national
supports do in fact have the “potential” to be re-oriented and expanded to
be more effective but through a new and distinctive national innovation
policy’
35 van Ark, B,. Broersma, L. and den Hertog, P (2003) ‘Service Innovation, Performance and Policy: A Review’.
36 Tether, B. (2005) ‘Do Services Innovate (Differently)? Insights from the European Innobarometer Survey’, Industry
and Innovation, Vol 12, No 2, pp 153-184.
37 Council for Science and Technology (2003) ‘Links between knowledge intensive services and the science base’.
38 Forfás (2006) ‘Services Innovation in Ireland – Options for Innovation Policy’.
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