Internal Market, Industry, Entrepreneurship and SMEs

Acronyms and Definitions

Acronyms and Definitions
CIS Community Innovation Survey
EPISIS European Policies and Instruments to Support Service Innovation
ESIC European Service Innovation Centre
ESIS European Service Innovation Scoreboard
GDP Gross Domestic Product
KIBS Knowledge-Intensive Business Services
KIS Knowledge-Intensive Services
LSD Large-Scale Demonstrator
MS Member State
SI Service Innovation
SMEs Small and Medium-sized Enterprises

Service Innovation
This term covers new or improved service concepts and offerings, irrespective of whether they are introduced by service companies or manufacturing companies. It also includes innovation in the service process, service infrastructure, customer processing, business models, commercialisation such as sales, marketing and delivery, service productivity and hybrid forms of innovation that simultaneously serve various user groups in different ways.

The Expert Panel on Service Innovation
This panel was comprised of 20 service innovation experts, policy-makers and practitioners. The role of the panel was to explore policy instruments and initiatives that had been applied to support innovation in services in Europe and to assess the best use and value of these policies. The final report of the Expert Panel on Service Innovation can be found via this link (2 MB).

The Transformative Power of Service Innovation
In its final recommendations (2 MB), the Expert Panel on Service Innovation introduced the term of 'transformative power of service innovation'. This term refers to the process when services “disrupt traditional channels to market, business processes and models, to enhance significantly customer experience in a way which impacts upon the value chain as a whole.” In this way, service innovation shapes emerging sectors, industries and markets and contributes to structural change and industrial modernisation.

Large-Scale Demonstrators
The origins of this concept can be found in the recommendations of the Expert Panel on Service Innovation (2 MB). The Panel referred to large-scale demonstrators that “represent a means for de-risking the development and scale-up of novel service systems, encouraging engagement with stakeholders and users, sharing experience across Europe, identifying clusters of expertise and opportunities for partnerships.” This approach involves a very significant shift from small-scale prototypes or pilot projects to large-scale, near-market, initiatives. In such initiatives, a range of solutions can be tested under real-life conditions with a view to better exploiting the transformative power of service innovation in tackling societal challenges, in addressing specific problems or needs, or in supporting a vision of a "change for the better”. The concept is both outcome-oriented and user experience-oriented and needs to be driven by a clear ‘owner’ of the challenge or problem that is being confronted, such as a municipal authority.

Smart Specialisation
This implies more targeted innovation policy in post-2013 Cohesion Policy. The mandatory Regional Research and Innovation Strategies for Smart Specialisation (RIS3 strategies) are integrated and have location-based transformation agendas. The agenda focuses on policy support and investments, builds on regions’ strengths, supports both technological and practise-based innovation and ensures that stakeholders are fully involved.

Traditional Manufacturing Industries
Traditional manufacturing industries can be understood as sectors involved in the processing and production of goods and services that have existed for a long time without much disruption or change and without having faced a major transformation such as merging with other sectors or introducing new business concepts or service innovation. They are usually referred to as the ‘secondary sector’ within industrial classification systems. Classical examples of such traditional manufacturing industries are automotive, food and beverage, textiles, consumer goods, chemicals and metal production.

Emerging Industries
Emerging industries can be understood as either being new industrial sectors or existing industrial sectors that are evolving or merging into new industries. The changes are most often driven by key enabling technologies, new business models, such as innovative service concepts, or by societal challenges, such as sustainability demands. Many emerging industries, like creative industries, mobile and mobility industries or eco-innovative industries, grow out of existing industries. Thus, they cut across different traditionally-defined sectors and build new industrial landscapes and value chains that integrate cross-sectoral competences and linkages.

Service Innovation-intensive Industries
Service innovation-intensive industries are those industries, across the whole range of private sector activities, which are service innovation intensive. This means that they have a significant share, or a growing share, of firms with service innovations.

The following service innovation-intensive industries have been identified using statistics based on Community Innovation Statistics data:

  • Manufacture of paper and paper products;
  • Publishing activities;
  • Telecommunications;
  • Computer programming, consultancy and related activities;
  • Information service activities;
  • Financial service activities, except insurance and pension funding;
  • Insurance, re-insurance and pension funding, except compulsory social security;
  • Architectural and engineering activities, technical testing and analysis, scientific research and development and advertising and market research.