How innovative are South Tyrolean companies?
Innovation is an essential requirement for ensuring the competitiveness of the company, in terms of production efficiency and the attractiveness of the range of products (goods or services) offered to customers. At the same time, it is a very important factor for economic growth, as it improves productivity and, as a result, increases the per capita income and wealth of the population. The high proportion of innovative companies in South Tyrol (both in terms of products and processes) is therefore a strong signal of the good health of our local economy. In some ways, considering the structural characteristics of our local production system, this result seems surprising. In fact, the South Tyrolean economy is characterized by the high influence of the "traditional" industries (agriculture, tourism, trade), which usually do not have a strong innovation activity. Moreover, most of the companies are small or very small: This can be a disadvantage as large enterprises are more likely to innovate. After all, large companies often operate in sectors with a high level of technology and knowledge intensity and, since they are active also in international markets, they are driven to innovate in order to be able to compete. Indeed, our study has confirmed that large companies are more likely to introduce new products and production processes, invest more financial and human resources in innovation and research, make greater use of public incentives, cooperate more frequently and apply for more patents.
For this reason, it seems contrary to the structural characteristics of our economy that our province is characterized by a high proportion of innovative companies. The explanation probably lies in the way in which local enterprises innovate their products and processes: often the necessary know-how in different forms simply comes from other enterprises. For example, this may be done by acquiring patents or licenses or by cooperating with other - perhaps foreign - companies. Process innovation is usually "acquired" from suppliers in the form of assets, equipment and other production goods. In the case of local subsidiaries of large enterprises or groups of enterprises, the idea for the introduction of new products or processes often comes from the head office, which also provides the necessary technologies. All this is confirmed by the statement regarding "Novel Innovators": The proportion of companies in South Tyrol that have introduced product innovations and launched "for the market new" goods or services is below the European average. Overall, local companies always keep pace with the competition and are susceptible to innovation but tend to imitate rather than to really develop new products and processes. If we analyze the proportion of South Tyrolean companies that spent a certain amount of money on innovation, we can observe that only a few companies invested in R&D (both internal and external), design and product design. On the other hand, investments in the acquisition of plants and equipment, the purchase of technology and the training of employees are very frequent.
The fact that in our province the investments intended for research are very limited is also confirmed by the latest ASTAT survey on R&D activity. This survey shows that the total expenditure on intra-enterprise research and development (public and private) amounts to barely 0.33% of the province's gross domestic product. In this context, it should be mentioned that by 2010 the Lisbon Agenda for the European Union has set a target of 3% of the gross domestic product to be invested in R&D. Low investments in research and development create risks as opportunities for further strengthening of our production system are wasted. The innovation activity carried out by South Tyrolean companies, even if it is quantitatively relevant and sufficient to maintain competitiveness, would probably require a further creative effort that could lead our companies to become truly competitive. Obviously, due to the small size of many South Tyrolean companies, it is not possible to make large investments in research and development. Once again, cooperation between companies and between companies and universities is a way of remedying the problem. In addition, better information on the support that the various institutions provide to innovative enterprises would be useful: Many respondents stated that they did not know the initiatives carried out for this purpose by the BIC (Business Innovation Centre, now TIS - Techno Innovation South Tyrol), the Province and the Chamber of Commerce. It is also regrettable because there is great satisfaction among those who have made use of it! Companies have often mentioned that they would like to have information and service centers for various topics: Technologies, financing, regulations and, above all, new markets. Of course, public subsidies play a fundamental role in promoting innovation which should be allocated using the quickest possible procedures. The time required and the burden of bureaucracy for the receiving companies must be minimized. In addition, people often mention the need to improve the opportunities for professional training and development of staff, especially in the field of information technology. Finally, several entrepreneurs have highlighted the need for better coordination between the various institutions involved in innovation. The efforts made by the provincial administration in creating the TIS could provide a solution for this problem. Indeed, TIS is a structure that not only supports companies in the start-
up phase, but also ensures the transfer of technological knowledge and the strengthening of business networks. On the other hand, the Innovation Service of the Chamber of Commerce supports companies by carrying out projects and providing advice regarding the companies' innovation strategy, the management of innovative processes and the protection of intellectual property rights. As a result, South Tyrolean companies have access to many valuable instruments that support innovation, the potential of which must be fully exploited.