1) KPI's and output parameters
In March, VARIO received a request from the Flemish minister for Innovation and the Economy Muyters to draw up a qualitative and measurable set of output parameters and Key Performance Indicators (KPIs) for the benefit of the next Flemish Government. They should expresses the Flemish ambition to be among the European leaders in innovation.
It is expected that the next Flemish Government will continue to build on the broad lines of the Coalition Agreement 2014-2019 and will also take the recommendations from the VARIO Memorandum into account. In the Memorandum, VARIO called for ‘smart’ KPIs and output parameters.
This advice is scheduled for May 2019.
2) Buy from start-ups
Adequate participation of start-ups in public procurement stimulates competition and creates opportunities for growth for these enterprises, while allowing public authorities to make use of their innovative services. In practice, however, both find it difficult to find each other because of all kinds of barriers; start-ups are not familiar with the procurement market, the procurement procedures are too complex ... The Flemish Government wants to remedy this and has launched a new initiative 'Buy from start-ups' to exploit their potential. The Flemish Minister of Economy and Innovation has asked VARIO for advice on the draft concept note.
3) Budgetary growth path: an analysis of the past and a strategy for the future
To make Flanders a top region in a worldwide innovative knowledge society, sufficient budgetary resources for research and innovation must be deployed. To this end, the Flemish government, the business-world and the knowledge institutions committed themselves to the Innovation Pact in 2003. In it, Flanders endorsed the Lisbon objective of spending 3% of GDP on research and development (R&D) by 2010. The Flemish government is responsible for 1%; companies generate the remaining 2%. The subsequent Flemish governments have repeatedly renewed this commitment and carried it out to the best of their ability. During the present legislature (2014-2019), R&D&I became a top priority, alongside healthcare. This has been expressed in an ambitious budgetary growth path for 'R&D and business measures', with a total of 500 million euro of recurrent extra resources at the end of the legislation. The EWI Budget Browser (Speurgids) 2018 shows that the public expenditure for R&D in Flanders in 2019 can be estimated at 0.81% of GDP, which brings the achievement of the 1% goal in sight. Achieving this goal by the end of the next legislature must be the objective, which, according to the current economic climate, would mean a further structural effort of at least 500 million euros. But in order to have overall beneficial effects, it is not only the total amount of resources that counts, they must also be used intelligently and in the most efficient way.
Based on a quantitative and qualitative analysis of the extra resources for science and innovation in the past, VARIO wishes to gain insight in the manner of deployment: recurrent versus one-off, the beneficiaries, order of magnitude, ... and possible areas for improvement. This forms the basis for recommendations on the desirable way to attribute the extra resources in the future, whereby the goal is not only for the government to achieve its 1% target for public resources, but at the same time create maximum leverage for private R&D.
Because VARIO wishes to provide his advice to the next Flemish Government, this advisory report is planned for the end of May 2019.
4) Top 5 regions of knowledge: comparative evaluation of Flanders
To realize the ambition of Flanders (in Belgium) to advance towards the top 5 of innovative knowledge regions in Europe, we perform an assessment of success factors on which Flanders should further focus, as well as on top European innovation regions from which we can learn.
First, a strengths weaknesses analysis of Flanders is carried out, based on international regional indicators, in particular RIS (Regional Innovation Scoreboard) and RCI (Regional Competitiveness Index). Secondly, we zoom in on the R&D and Innovation systems of a limited amount of top innovation regions, as well as on runner-up regions that made a lot of progress in a short period of time. Special attention will be paid to the role of urbanized areas for innovation and competitiveness.
5) Excellence policy in basic scientific research
Excellent research has more impact and makes Flanders internationally attractive as a knowledge region. Conversely, internationalisation also increases the excellence of research. An important lever for this is international mobility of researchers and international cooperation.
Researchers and knowledge institutions in Flanders generally score well on criteria for excellence, but how can this be improved? For international mobility of our researchers, the margin for improvement seems to be lager. VARIO wants to map existing data and investigate how international mobility can be stimulated. Furthermore, how can Flanders specifically attract more excellent researchers from abroad? For this advisory trajectory, VARIO is also considering an evaluation of existing initiatives such as the Odysseus and Methusalem programmes (FWO and BOF respectively). A further specific topic is how to increase the success of Flanders in the EU Framework Programme for Innovation and Research, in the parts falling under the excellence pillar in the current Horizon 2020 (2014-2020): ERC, Future and Emerging Technologies (FET), MSCA and research infrastructures. What can we learn from successful examples from abroad, such as Switzerland, which is strong in attracting foreign ERC grant holders?
6) Attracting and retaining foreign R&D centers
One of the Flemish 2030 objectives (VIZIER 2030) is 'By 2030, Flanders will increase the number of knowledge-driven foreign investments in Flanders, which also generate employment...' In 2017, foreign companies invested 2.08 billion euro in branches in Flanders; this concern 215 projects that generated a total of 5377 new jobs. The 43 projects specifically aimed at investments in research and development created a total of 1367 jobs (FIT). Besides the impact on employment, foreign investments in R&D can also offer other opportunities for a host country: an increase in aggregated R&D expenditure, knowledge dissemination, increase in the demand for skilled labour, etc.
In Belgium, 60% of business R&D expenditure takes place in branches under foreign control (2013). According to VARIO, it is therefore relevant to look in more detail at the specific added value of incoming foreign investments in R&D for Flanders.
Questions for analysis include:
- How important is the establishment of foreign R&D centres in Flanders for our region?
- Which factors are important in determining the location of R&D activities?
- What measures exist to support the location of new R&D activities through incoming foreign direct investment?
- What is the economic and innovation contribution of these R&D centres for Flanders?
- How can Flanders attract and retain more foreign R&D centres?
7) Intersectoral mobility
The intersectoral mobility of researchers between the academic and private sector is consistently cited in innovation reports as an important driver of companies' ability to absorb new knowledge. The European Commission believes companies in Europe do not optimally convert such newly developed knowledge into commercial applications (the so-called 'innovation paradox'). Consequently important economic potential is not realized. Therefore, VARIO has put the theme of 'intersectoral mobility' on its agenda.
The most obvious focus group is academic researchers. According to a recent study of the European Commission, academic researchers in the EU appear to have only limited interest in gaining experience in industry, e.g. in the form of dual positions or short exchanges. This appears to be related, among other things, to the perception of a limited positive, or even negative, impact on career prospects. VARIO has set itself the goal to map the current situation in Flanders for this important group: not only how mobile researchers are, but also which factors influence mobility. Does it make sense for the Flemish government to take measures to stimulate this form of mobility? And if so, which ones?
In addition, VARIO is aware of the fact that innovation is not the exclusive terrain of PhD holders. Graduates with other degrees also hold key positions in the Flemish innovation landscape. VARIO will therefore take a broad focus what concerns the target group/focus of its advice, as intersectoral mobility of Bachelors and Masters also has an important impact on knowledge spillovers: think, for example, of the inflow of experts in education.