An IQ Test For Countries, Regions, Sectors and Companies

The capacity to innovate is the key to economic success in the competitive 21st century marketplace. But what makes one country a better innovator than another? And how is it possible to measure the innovation capability of economies, regions, sectors or companies? Whereas the majority of conventional innovation indicators generally examine innovative performance, the indicator developed by the Institute for Innovation and Technology (iit) focuses on the underlying ability to innovate. The iit Innovation Capability Indicator provides decision makers from politics and the private sector with a reliable instrument with which they can measure the ability of individual countries, regions, sectors and companies to translate new ideas into competitive products and services.

The main factors that contribute to the innovation capability of economies, regions, sectors and companies are the available knowledge and the combination of knowledge. The decisive factors are the quality of the workforce’s education and training, the diversity of useful knowledge and the ability to skilfully combine various stocks of knowledge. For this reason, the iit indicator includes values from four areas in its calculations for depicting innovation capability. Together, these areas determine the capacity for innovation: in-depth specialist knowledge (human capital), the diversity of the relevant knowledge (complexity capital) and the ability of companies to collate these different stocks of knowledge, both internally (structural capital) and outside of the organisation (relational capital).

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