FINLANDS INNOVATION STRENGTHS AND WEAKNESSES

Element Assessment* Key strengths Key weaknesses

Money: investment in science and innovation

Strong Strong overall, business and government investment in R&D, even when adjusted for industrial structure; good access to seed, start-up and early stage VC funding

Relatively more limited access to later stage venture capital and growth finance; somewhat lower investment in non-R&D intangibles

Talent: people and skills for innovation

Medium strong

Strong basic (literacy, numeracy, problem solving) skills; high proportion of population with tertiary education; relatively high proportion of work force are STEM graduates; strong researcher base in industry; high absorptive capacity of firms, including SMEs

Limited critical mass of internationally mobile students and researchers; somewhat limited ability to attract world-class researchers; [no benchmarking data on management skills]

Knowledge assets and exploitation: access to and exploitation of science, ideas, expertise and collaboration

Medium strong

Strong academic/business collaboration, including with SMEs; high quality research institutions in targeted technology areas; large number of patent registrations (but can be misleading as a metric as highly sector dependent)

Limited internationally recognised academic research; relatively weak international collaboration networks in science

Innovation policies: governments actions to encourage innovation

Strong High quality intellectual property regime; established and well-regarded national innovation agency; successful growth support programmes; strong open data initiatives; relatively pro-innovation public procurement; innovation policies relatively well coordinated (based on systems view of innovation); policy evaluation well-established

Fragmented policy approach in previous parliamentary period (2011-2015); uncertain impact of recent introduction

of R&D tax credits

Broader environment: ease of and incentives for innovating

Medium Relatively business-friendly environment (except some labour market policies); high-quality infrastructure (especially broadband); a number of highly effective technology clusters; firms relatively fast adopters of new technology; school instils entrepreneurial attitudes (and entrepreneurship is part of curriculum)

Mixed ability to attract foreign R&D investment; surprisingly negative attitudes towards scientific research; inflexible wage determination and hiring and firing practices; relatively low levels of entrepreneurial activity; small and not very competitive local market

Innovation outputs: overall innovativeness of the economy

Medium Relatively high proportion of innovative companies and company sales from new innovations; comparative advantage in knowledge-intensive, high-tech products; strongly positive technology balance of payments

Mediocre overall labour productivity; relatively low level of early stage, growth-oriented and internationally oriented entrepreneurial activity; relatively small proportion of exporting firms; lower levels of service sector and non-technological innovation

* Strengths and weaknesses have been assessed relative to comparable countries rather than on an absolute basis

Sources: Insights from international benchmarking of the UK science and innovation system (Tera Allas for Department, for Business,

Innovation and Skills, 2014); European Commission Innovation Union Scoreboard 2015; OECD Science, Technology and Industry

Outlook 2014; The Global Innovation Index 2014; World Economic Forum Global Competitiveness Report 2014 - 2015