In this interview the rationale behind the establishing of ESIC is revealed and Reinhard Büscher, the former Head of the 'Clusters and Support for SME's' Unit at DG ENT, will also tell what gains he is anticipating from the model demonstrator approach and what will regions need the most to achieve the systemic change that the EC would like to see.
The European Service Innovation Centre (ESIC) is a two-year initiative contracted by the European Commission's DG Enterprise and Industry to raise and spread awareness about the role of service innovation in economic development. What was the rationale behind the establishing of ESIC?
Reinhard Büscher: In recent years, the importance of service innovation to competitiveness and economic development has become more and more apparent. However, we should not only look at service innovation as such, but at its transformative power. Service innovation is not only creating new business opportunities for start-ups but is sometimes changing entire value chains and industries, for good or for bad. ESIC should help to promote a better understanding of these structural changes. Not only enterprises, but also policy-makers must be prepared for such disruptions and not be over-reliant on current strengths and competitive advantages that could disappear overnight.
DG Enterprise and Industry has considerable experience of supporting service innovation-related initiatives. What gains do you anticipate from the model demonstrator approach?
Reinhard Büscher:The idea behind ESIC is not to support service innovation as such, or the companies driving such innovations. The challenge is much broader: how does service innovation affect industrial structures of a regional economy, both in manufacturing and in services, and how well are regions, for example through their smart specialisation strategies prepared to capitalise on service innovation or to survive disruptive effects resulting from service innovation? Too many policies are still too focused on defensive strategies to protect existing industrial structures or to support individual enterprises. The model demonstrator regions should illustrate how modern industrial policy facilitates structural change and capitalises on all forms of innovation. This requires, in my understanding, a more systemic approach that both facilitates structural change and promotes cross-sectoral cooperation.
European regions face several grand challenges and there is a growing need to act ‘differently’. What will regions need the most to achieve the systemic change that the Commission would like to see?
Reinhard Büscher:Most importantly, regions should accept structural change and not follow a narrowly defined sectoral approach. The boundaries between sectors are increasingly becoming blurred, often because of service innovation. New markets are most often created at the borders of different sectors and generally in a rather unpredictable manner. Intelligent or ‘smart’ industrial policies create space for such innovations that result from interactions between different sectors, technologies or people. In times of global competition, regions must seek to create as much value as possible in their economies. This is best achieved by combining the different strengths and assets that are available in a region more intelligently.
How can regions and the work of ESIC best put flesh on the bones of the innovation components of the EU 2020 Strategy?
Reinhard Büscher:ESIC can open people’s eyes to the need to combine different policies and instruments intelligently in promoting structural change within regions. Firstly, by showing what really drives service innovation and how regions are positioned in this respect. Secondly, by assessing the capability of regional policies and strategies to capitalise on service innovation and drive structural change. At this stage, ESIC will not tell regions exactly what to do, but will help them to take a critical look at the design of their policies and strategies: their openness to embrace structural change, the way they support all forms of innovation and take advantage of all the talents and creativity, the incentives they provide for cross-sectoral innovation and the way they promote entrepreneurial spirit.