North Netherlands innovation benefits still insufficiently capitalized

While businesses in the Northern Netherlands are innovative, they could capitalize more on the benefits of research and product development. This is the outcome of research by Dries Faems, Professor of Organization and Innovation at the Vinci Expertise Centre of the University of Groningen together with the Northern Netherlands Provinces Alliance (SNN).

Investing in research and development carries substantial costs and even has a negative effect on the net profit margin of many companies. ‘Research and development only truly pay off when companies are able to combine their technological innovations with organizational innovation’, says Professor Faems.

2017 Innovation Monitor

Faems draws this conclusion based on data from the 2017 North Netherlands Innovation Monitor, a study among the many different SMEs in this region. Faems claims that companies can only start benefiting from research and product development if they succeed in actually anchoring the innovations in their business operations and in the structure of their organization. ‘Combining technological and organizational innovation allows for maximum innovation at low cost. This not only leads to a more innovative business, but also to a financially healthier one.’

More focus on organizational innovation

There are also lessons to be learned from the research at the regional economic level. Economic subsidies, for instance, have mostly been aimed at technological innovation. Faems: ‘It would be good if subsidy schemes paid more attention to organizational innovation as well. This would increase their economic impact.’

Smart specialization

The professor further advocates smart specialization in the Northern economy. He has high expectations of businesses and knowledge institutions that are experimenting with new technologies and sustainable materials. Faems also points to existing regional initiatives, such as Region or Smart Factories and Technologies Added, as important hubs for experimenting with advanced production technology.

For more information

• Contact: Dries Faems

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