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Innovation Process – Managing Complexity through Financial Aspects

Authors:
Borut Likar
Peter Fatur

Keywords: innovation; R&D; technology; economic performance; productivity; complex systems

Abstract:
The research investigates one of the most complex parts of the business system – innovation process. The relationship between the company’s innovation inputs and its innovation performance was studied on a sample of 2503 companies from manufacturing and selected service sectors. The research was based on official Eurostat statistical data. As these data were essentially not adapted for analysis of companies’ innovation performance, the methodology for companies’ innovation-business performance was developed. The groups of non-innovators, innovation followers and innovation leaders were formed. In the group of leaders, ROE is 40% higher as regards the group of innovation followers. Each euro invested into innovations yields 13.9 Euros in the same group. But an increase in investments is related with the growth of productivity of invested assets only in the group of followers. Interestingly, increasing a portion of »breakthrough« innovations reduces the productivity of these assets in the group of leaders. On the basis of these findings recommendations are provided as to which policies of innovation investments should different types of innovation followers adopt so as to catch up with the group of innovation leaders.

Pages: 145 to 149

Copyright: Copyright (c) IARIA, 2011

Publication date: January 23, 2011

Published in: conference

ISSN: 2308-4243

ISBN: 978-1-61208-114-4

Location: St. Maarten, The Netherlands Antilles

Dates: from January 23, 2011 to January 28, 2011