Open Innovation Ecosystems for Horizon 2020 - New Approach

Helsinki/Espoo, April 2013

Bror SalmelinAdvisor to the DG, Innovation SystemsEuropean Commissionbror.salmelin@ec.europa.eu

European Commission Vice President Neelie Kroes (18/12/2012)

2013 will be the busiest year yet for the Digital Agenda. My top priorities are to increase broadband investment and to maximise the digital sector's

contribution to Europe's recovery.

The digital economy is growing at seven times

the rate of the rest of the economy, but this

potential is currently held back by a patchy pan-

European policy framework.

The digital economy is growing at seven times

the rate of the rest of the economy, but this

potential is currently held back by a patchy pan-

European policy framework.

Very fast internet supply and demandBroadband drives competiveness

Correlation Fixed Broadband Penetration and Competitiveness

4

4.2

4.4

4.6

4.8

5

5.2

5.4

5.6

5.8

0.1 0.15 0.2 0.25 0.3 0.35 0.4 0.45

Fixed broadband lines per 100 population

WE

F's

Glo

bal

Co

mp

etit

ive

Ind

ex s

core

DenmarkNetherlands

KoreaLuxembourg

Sweden

Germany

FranceBelgium

UK

Finland

Malta

USJapan

Austria

Estonia

Ireland

Slovenia

Cyprus

Spain

Italy

Czech Rep.

Hungary

LithuaniaPortugal

LatviaSlovakia

Poland

Bulgaria

Romania

European Commission, 2011

A 10% increase in the broadband penetration rate results in 1 to 1.5% increase in annual GDP per-capita. Faster broadband = higher GDP growth. (Czernich et al. -

University of Munich, 2009)

Sustainability

• Sustainable innovation is full of disruptions!

• Sustainable innovation is about (value) choices!

• Sustainable innovation is beyond (political) buzzwords

• Sustainable innovation is holistic!

Diversity means breakthrough probability

•

High low

Low

high

Val

ue

of

inn

ova

tio

n

Breakthrough

average

insignificant

Alignment of team members’ disciplines

New entrepreneurship -> new skills, attitude, talent! Connectivity!

Policies

• Open innovation processes and environments (e.g. Living Labs)

• Technology enablers (ICT, KET)• Societal innovation

• -> Business model innovation a weak point in Europe

Maslow 2.0 for organisations

Schwarz’ Universal Values

Innovation?

• Make things happen!

Science based linear innovation is NOT mainstream anymore!

• User-centric innovation • Open innovation• Systemic innovation• Experimental mash-up

• Leadership with courage -> new management skills

Innovation as parallel activities

Kn

ow

led

ge

Mark

ets

ResearchResearch

PrototypingPrototyping

Pilot roll-outPilot roll-out

ProductionProduction

Each activity collects knowledge about product/market fit

Innovation moving out of the Lab

Centralized inward looking innovationClosed Innovation

Ecosystem centric, cross-organizational innovation Innovation Networks

Sources: Chesbrough 2003, Forrester 2004, von Hippel 2005

Externally focused, collaborative innovation Open Innovation

The European Perspective

Towards a EuropeanDigital Single Market

Smart Cities andRegions

Regional/Cohesion PolicyContributing to Smart growth

Innovation UnionDigital Agenda for Europe

CIP/CIP/ICT-PSPICT-PSPPilots in specific domainsPilots in specific domains

across bordersacross bordersFP7/ FP8FP7/ FP8

ICT theme: FI PPP, EIPs, JTIsICT theme: FI PPP, EIPs, JTIs

Other policies: industrial policy for the globalisation era, youth on the move,Agenda for new skills and jobs, resource efficient Europe, the green digital charter…

Future Internet for citizen-centric innovation

Other instruments:Structural Funds, National funding, Financial Instruments

Europe 2020 “smart, sustainable and inclusive growth”

EIT / KICs : bridging EIT / KICs : bridging education research education research

innovationinnovation

Common strategic Framework for Research and InnovationHORIZON 2020

Essential drivers

• connectivity• open• interaction• “organic” (OrganiCsations..)

• NON-controllable, only catalyzing possible

Innovation Activities (examples) H2020 Instrument/scheme

Pilots (prototyping, pilot lines, demonstration, testing)

Research and Innovation grant

Pre-commercial procurement PCP

Public procurement of innovation PPI

Result based award Recognition, Inducement prizes

Targetting SME SME instrument (also for individual SMEs)

Non prescriptive calls; open, light and fast Open Distruptive Innovation scheme (using lumps sums and R&I grants)

Road-map based, critical mass Contractual PPP (using all instruments), JTI

Targetting societal challenge European Innovation Partnership (using all instruments)+Smart specialization

Clustering, bridge to accelerators, incubators Coordination and Support action

ODI scheme using complementary H2020 Instruments

Phase 1: Technical market feasibility and prototyping R&I grant lump sum x 3-9 months

Phase 2: Validation & piloting of scalable solutions R&I grant covering eligible costs x 12-18 m

Support measures Succesful projects reaching end of Phase 2 = EU Disruptive Innovation

Label/Prizes Exposure on dedicated platforms (e.g. crowd-funding and V.C. seeds)

Ph.1

EU Disruptive Innovation

Label

On-line assessment EU Disruptive Idea Label & Exposure on EU Dedicated Platforms & events etc.

Ph. 2

20

SME instrument?

IDEA continued support throughout the project MARKET

Phase 1: Concept & Feasibility

Assessment

Phase 2: Demonstration

Market ReplicationR&D

Phase 3: Commercialisation

Idea to concept, risk assessment, technological &

commercial feasibility

Demonstration, prototyping, testing ,

market replication, scaling up, miniaturisation,

research

Quality label for successful projects,

access to risk finance, indirect

support

SME window EU financial facilities

Pre-commercial procurement

Hierarchy of Prize schemes for ICT in H2020

PCP and PPI PCP and PPI complementarycomplementary

Supplier B

Supplier C

Supplier D

Phase 1 Solution design

Phase 2 Prototypedevelopment

Phase 3 Original developmentof limited volumeof first test products /servicesSupplier A

Supplier B

Supplier C

Supplier D

Supplier B

Phase 0 CuriosityDrivenResearch

Phase 4 Deployment of commercial end-productsDiffusion of newly developedproducts / services

Supplier D

Public Procurement of Innovative Solutions (PPI)

Supplier(s) A,B,C,Dand/or X

Two possibilities in H2020 (for PCP/PPI) & CEF (for PPI)– EC can co-finance PCPs/PPIs carried out by grant beneficiaries– EC or EU agencies can carry out PCPs/PPIs on their own behalf or jointly with Member States

PCP to steer the development of solutions towards concrete public sector needs, whilst comparing/validating alternative solution approaches from various vendors

PPI to act as launching customer / early adopter / first buyer of innovative commercial end-solutions newly arriving on the market

R&D / Pre-commercial Procurement (PCP)

Integrating R and I

Grand Coalition

Important considerations

• Cost of NOT doing something?

• How to make innovation space fluid?

• How to move from control to encouragement?

• Rules of the game clear, ex post control

• Rules to share and build value

• Experimentation mentality (fail fast in small things, not in the big one)

•

More information

www.ec.europa.eu/research/horizon2020

http://ec.europa.eu/digital-agenda

https://ec.europa.eu/digital-agenda/en/grand-coalition-digital-jobs-0

http://ec.europa.eu/digital-agenda/en/open-innovation

bror.salmelin@ec.europa.eu