Transformative Innovation Policy (TIP)

“Transformative Innovation Policies (TIPs) are based on the notion that addressing the key challenges currently facing our societies requires profound changes in current socio-technical systems (Weber and Rohracher 2012; Schot and Steinmueller 2018). To leverage such ‘socio-technical transitions’ calls for a broad mix of research and innovation policies, with particular attention being paid to societal experimentation. These are demonstration projects focused on societal and/or ecological challenges and involving many actors, including social, grassroots, and civil society innovators. They address long-term policy objectives often accompanied by long-term targets and plans to achieve them, and can be supported by strategic visioning and foresight processes. They may deploy policy mixes building on traditional policy instruments, such as R&D subsidies, tax incentives, programmes for building R&D and innovation platforms, and policies for stimulating entrepreneurship. To become part of the TIP mix, policies need to focus on enabling a transformation (Rogge, Pfluger and Geels 2020). Following Schot, Kivimaa and Torrens (2019), we argue that all TIPs should be executed as Experimental Policy Engagements (EPEs). This notion is introduced to signal that transitions are complex and long-term processes that can be modulated through TIPs but not controlled. In other words, TIPs engage with ongoing transitions that are influenced by many other actors and factors.”

[Source: Molas-Gallart, J., Boni, A., Giachi, S., Schot, J., 2021. A formative approach to the evaluation of Transformative Innovation Policies. Research Evaluation rvab016. https://doi.org/10.1093/reseval/rvab016]

“… focuses attention on addressing societal and environmental challenges through socio-technical system change (which is different from knowledge production and product and process innovation). From this perspective, the directionality of innovation, and the connection between the ecological, social, and the technological arenas become key concerns. Directionality means that innovation policy will not just stimulate specific technological options, but will look into the social and environmental drivers and consequences of each option, then aim for a deliberation on desirable policy directions and eventually foster some desired directions for innovation, while blocking undesirable ones. Of course, this is an iterative process, and not all consequences and directions can be known upfront, so a flexible approach is required. To address directionality, TIPs need to incorporate deep learning and reflexivity, which in this context we take it to imply the questioning and reframing of underlying assumptions about desirable directions. Deep learning or second-order learning typically emerges if the diversity of opinions and beliefs among stakeholders are acknowledged and embraced. Because focusing on disruptive change can result in disagreements among the stakeholders, TIPs require broad consultation processes to discuss different rationales and perspectives in order to broaden the scope of inputs into policy definition, uncover innovative ideas, and minimize legitimation problems later on.”

[Source: Molas-Gallart, J., Boni, A., Giachi, S., Schot, J., 2021. A formative approach to the evaluation of Transformative Innovation Policies. Research Evaluation rvab016. https://doi.org/10.1093/reseval/rvab016]

“A broad conceptualization of transformative innovation policy has, following our proposed framework, a broader understanding of the innovation process and its relevant actors, activities and modes of innovation. It is often expressed in terms of socio-technical transitions (Elzen et al., 2004) or societal transformations (Scoones et al., 2015). … These encompass many different ideas and concepts emerging that aim to address societal challenges but are grounded in a more broad-based understanding of innovation. They draw on a variety of discourses, including social innovation (Mulgan, 2012), complex adaptive systems (Gunderson and Holling, 2001), eco-innovation (Kemp, 2011), grassroots innovation (Smith et al., 2014), inclusive innovation (Chataway et al., 2013) responsible research and innovation (Owen et al., 2012) and theories associated with the diffusion of innovations (Rogers, 2010). What these discourses have in common is that they emphasize participative social innovation as an alternative to expert-led technological change. A broad transformative agenda therefore proposes that contemporary societal challenges are wider in scope, are often difficult to clearly define, and will require the actions of a broader and more diverse set of actors both to formulate and to address them (Kemp et al., 2007;Loorbach, 2010 ). These scholars argue that possible solutions include social, institutional and behavioural changes, as well as technological innovations (Geels, 2004). ….

…societal challenges are viewed as more than just a market failure requiring incentives for academia and industry to come up with technological solutions. A singular focus on supply-side activities is considered unlikely to suffice. Furthermore, it is increasingly being questioned whether it is likely that the state, which has traditionally led such mission-oriented research in the past, will be able and willing again to take up this role (Schot and Steinmueller, 2018). …. many civil actors that have proven to be indispensable in innovation processes, such as users and citizens (Schot et al., 2016), non-governmental organizations and charities (Kuhlmann and Rip, 2014) and cities (Bulkeley and Castán Broto, 2013). These concerns are sometimes coupled to suggestions for wider political and economic change.”

[Source: Diercks, G., Larsen, H., Steward, F., 2019. Transformative innovation policy: Addressing variety in an emerging policy paradigm. Research Policy 48, 880–894]

A narrow conceptualization of transformative innovation policy has, following our proposed framework, a narrow understanding of the innovation process and its relevant actors, activities and modes of innovation. It is often expressed in terms of academic- and industry-led technological “revolutions”. A distinction can be made between “techno-scientific production revolutions” with strong government support (Grubb, 2004; Balconi et al., 2010;Dechezleprêtre et al., 2016; Schwab, 2016) or slightly broader “techno-economic industrial revolutions” achieved by shaping and creating new markets through active government intervention (Perez, 2010;Mazzucato, 2013 ). The underlying premise for both narratives is that they see the advent of societal challenges as new priorities for R&D through dedicated mission-oriented public funding (see, for instance, European Commission, 2018). These approaches subscribe to a narrow understanding of the innovation process, meaning that they largely view innovation as the “commercialization of science”, with academia and industry as leading actors, a strong focus on R&D for new technologies informed by a linear model of innovation, and the need to address market failures. In the end, scientific breakthroughs are intended to lead to radical changes in technology, such as the transition to energy-efficient light bulbs, solar and wind energy, or electric vehicles (Geels et al., 2015). Although advocates of techno-economic paradigms have a broader and more systemic understanding of the innovation process and corresponding systemic failures, their approaches echo those of the past. This new challenge-led policy agenda is reminiscent of the missionoriented programmes such as the Manhattan Project or the Apollo Program (Ulnicane, 2016). It is often suggested that similar targeted R& D programmes are an appropriate response in addressing contemporary societal challenges. In other words, advocates suggest that the advent of societal challenges demands dedicated mission-oriented public funding for those fields of science and technology that could help in addressing them (Mazzucato, 2017).

readiness

Transformative Innovation policy is faced with the dilemma of technology readiness. The technology readiness level (TRL) of a applied research project determines whether and how high a project is funded. I.e. that the technological component (and whatever the funding agency defines as such) as well as the assumption that the innovation on which this builds has to be assumed to be new to a market (whatever this means for the funding agency) are the primary project selection criteria.  Even though the OECD has implicitly long recognised that market ready innovation is not necessarily based on new technology, by extending the definition to include products, services, processes, organisations and marketing, a contradiction has not been remedied.

[Source: Kubeczko, K., 2022. Transformative Readiness - Unpacking the technological and non-technological aspects of sustainability transitions. Presented at the IST 2023.]

~~DISCUSSION|Discussion Section - PAGE OWNER: Klaus Kubeczko~~