The Innobarometer 2013: Investing in Intangibles

Transcription

1 The Innobarometer 2013: Investing in Intangibles II IRIMA Workshop: Counting (and accounting) R&D and non-r&d intangibles Brussels, 10 December 2013 Sandro Montresor Dept. of Economics, University of Bologna (IT) (JRC-IPTS, European Commission, Seville (E))

2 Agenda 1 Previous JRC-IPTS (IRI) tangibles on intangibles : i. Motivations; ii. iii. Data and methodology; Results and policy implications: snapshot. 2 The Innobarometer-2013 : i. Motivations; ii. Conceptual and factual pillars; iii. Characteristics (originality); iv. First analysis: methodology and main results; v. Conclusions and policy implications.

3 1 Previous IRI tangibles on intangibles WP 06/2011, Intangible resources: the relevance of training for European firms' innovative performance, by Daria Ciriaci; WP 08/2011, Design and European firms' innovative performance: A less costly innovation activity for European SMEs?, by Daria Ciriaci; WP 09/2011, The relevance of marketing in the success of innovations, by Abrham García; PB 10/2012, Bridging ideas with markets: the impact of training, marketing and design on innovation, by Daria Ciriaci and Fernando Hervás.

4 1 Previous IRI tangibles on intangibles i. Motivations: ex-irma and IRIMA Taking innovation at large: beyond the linear model (R&D-centric); The non-r&d drivers of innovation: Which ones? How much do they matter (innovation)? with respect to R&D (IRI Scoreboard)? Other innovation policies than R&D stimuli?

5 1 Previous IRI tangibles on intangibles ii. Data: Community Innovation Survey (e.g. CIS3) Methodology: Econometric estimates (system of multiple equations á la CDM (1998)).

6 1 Previous IRI tangibles on intangibles iii. Snapshot of results and policy implications Impact on innovative sales, of a 10% increase of: Training +1.5% Marketing +7.0% Design +3.5 o o o No significant size differences in TRAINING returns ; DESIGN more cost-efficient than R&D for SMEs' innovation ; MARKETING, the innovation impact increases with size". DESIGN for INNOVATION (DG ENT)

7 Innobarometer sheds light on innovation across Europe Annual opinion poll on innovation // policy issues Investing in Intangibles

8 IRI s actions and outputs in the Innobarometer-2013 Step 1: stock-taking of the scientific contributions and survey experiences; Step 2: detailed analysis of the NESTA-sponsored IIA and adaptation of its approach to a flash CATI survey; Step 3: integration in the draft questionnaire of additional questions requested by the users; Step 4: design of the questionnaire according to the needs of the data collectors.

9 Outputs

10 i. Motivations: complementing other sources of microdata on intangibles: a. Accounting-data: stringency of accounting standards (IAS38) in identifying and reporting intangible assets; b. Voluntary disclosure: un-systematic and with traces of negative effects (e.g. market value, profitability, ); c. Consultancy experiences (e.g. Balanced Scorecard): heterogeneity and scanty monetary evaluations; d. (Public) Business surveys: country-specific experiences (INSEE (FR) 2004; NESTA-ONS (UK): 2009, 2010, 2011).

11 ii. Conceptual and factual pillars: 1. Accounting-like definition of intangibles (IAS/ISFR 38).

12 ii. Pillars (cont d): 2. NESTA-like (IIA), spending-based categorization of intangibles (CHS2005 classification).

13 ii. Pillars (cont d): 3. Capability-based approach (Dosi et al., 2000; Arrighetti et al., 2013).

14 ii. Pillars (cont d): 4. Intangible resources vs. intangible services (innovation) (Penrose, 1959).

15 iii.characteristics: common Innobarometer features; 1. Multi-purpose, qualitative survey, not to be used for single purposes (e.g. estimate of R&D expenditure); 2. CATI survey, with no room for detailed description of the topics covered (10 QUs); 3. Flash approach, with small samples extracted from commercial databases (limited size/sector breakdown see later).

16 iii.characteristics (cont d): original features; 1. Updated (2011), cross-country (EU28 + 8), cross-industry (manuf. and services), and cross-size (micro, SMEs, large); 2. Qualitative, but with an important quantitative benchmark info: % of turnover; 3. Distinction internal/external intangibles: theoretical ground and empirical position (wrt national accounting); 4. Selection of innovating-respondents (in Oslo terms) and matching between intangibles/cis-like data.

17 iii. Characteristics in the Questionnaire: Strategic role of intangibles

18 iii. Characteristics in the Questionnaire: Intangibles as assets

19 iii. Characteristics in the Questionnaire: Institutional and economic drivers Monetary and non-monetary obstacles

20 iii. Characteristics in the Questionnaire: Step 1 Step 2 Innovative use of intangibles

21 iv. First analysis: methodology; a. Statistical check: Systematic reporting-bias (e.g. right respondents ): potential group of outliers (k-means clustering, SAS/FASTCLUS) negligible influence (no required exclusions); Rates of response: CIS aligned national rates, but 50-70% lower than business statistics (minimum n. of respondents by country); Sampling rates: population of millions of enterprises (36 countries), low sampling rates and non-detailed industry/size stratification; Low precision levels (robustness unaffacted) and confidence intervals.

22 iv. First analysis: methodology (cont d); b. Descriptive statistics: Statistics by questions (see the Questionnaire); Principal Component Analysis; Multiple Correspondence Analysis; Country/size/sector weighting.

23 iv. First analysis: results; 1. The strategic role of intangibles: Q2 and Q3: How much? Make or buy? Which intangibles? Q4 and Q5: How long (benefits)? Reporting? 2. Intangibles for innovation: Q9 and Q10 How much? Which innovators? Which intangibles? 3. Context conditions and business incentives: Q6 motivations; Q7 obstacles. NB: Crossing with enterprises objectives and structural features (e.g. size, sector,..): D1 D8.

24 PCA of Q4 2 The Innobarometer-2013 iv.1 - The strategic role of intangibles: intensity (internal and external) and expected benefits PCA of Q2 and Q3

25 iv.1 The strategic role of intangibles: internal intangibles and firm size. Intangibles more strategic for SMEs (especially in services); Micro and large companies more reliant on external providers.

26 iv.1 The strategic role of intangibles: separable intangibles and industry. Services more reliant on transversal organizational intangibles (training, reputation/branding, organization competencies).

27 iv.1 The strategic role of intangibles: intangibles and business priorities. Intangibles more for "differentiation" than "cost advantages" Separable intangibles strategic for innovationoriented firms

28 iv.1 - The strategic role of intangibles: EU vs US. Intangibles more strategic for US than EU companies? More intensive, internal, but also more unseparable (training, reputation, organization) than "separable" intangibles (e.g. R&D, software an design).

29 iv.1 The strategic role of intangibles: service-life. > 2 years: 50% companies for reputation and branding, R&D and design; 40% for software, organization and training. Longer benefits, larger intensity, higher internal efforts

30 iv.1 The strategic role of intangibles: reporting. Shares of reporting firms not dissimilar across industries; Reporting increases progressively with firm size.

31 iv.2 Intangibles for innovation: the Innobarometer innovative firms. TECHNO? Remarkable shares of multi-innovative firms in the sample, though with different combinations.

32 iv.2 Intangibles for innovation: the Innobarometer innovative firms. Innovators with consistent mappings: 1. Customised solutions: TECHNO 2. New prod/proc development: MARKT 3. Increase labour productivity: ORG

33 iv.2 Intangibles for innovation: intangibles and kind of innovation. TECH MKT ORG The largest shares of innovators in general invest little (1-5%) of their turnover in their intangibles; But non-technological ones more frequently invest 5-15% of it.

34 iv.2 Intangibles for innovation: intangibles and kind of innovation. TECH MKT ORG The largest shares of innovators invest in different intangibles: TECH: software; MKT: organization; ORG: training.

35 iv.2 Intangibles for innovation: intangibles for inno. R&D (26% inno-firms with more than 5% of the investment used for inno-projects) vs. training (19% inno-firms). Larger share (more than 50% of the investments dedicated to innovation) for a large group of large companies (25%).

36 iv.2 Intangibles for innovation: intangibles for inno. Compare with reputation and branding

37 iv.3 Context and incentives: motivations. From the TNS report: - Economic motivations more pervasive than the institutional set-up. - Search for better relationships with business partners (55%) and for higher efficiency of the business processes (43%) selected by more than twice the firms than industry's regulatory framework (23%) and receipt of a public support (13%).

38 iv.3 Context and incentives: motivations (cont d). Dimension 2 (vertical axis): surveyed firms clustered into economic vs. institutional driven in intangible investements Policy concern: Who is whom?

39 iv.3 Context and incentives: motivations (cont d). Unlike micro and large companies, SMEs have invested in intangibles mainly for institutional reasons (+ upper part); Investments more consistently driven by economic motivations (- lower part) in service firms only.

40 iv.3 Context and incentives: obstacles. From the TNS report: Main obstacles: costs associated with the investments in intangibles (45% of the firms); availability of monetary resources: limited public financial support (35%) and unfavourable tax treatment of intangible assets (33%).

41 iv.3 Context and incentives: obstacles (cont d). Dimension 2 (vertical axis): surveyed firms clustered into monetary (i.e. costs, public finance) vs. non-monetary barriers (i.e. regulatory, accounting) Policy concern: Who is whom?

42 iv.3 Context and incentives: obstacles (cont d). Monetary obstacles (+ upper part) more binding for micro and SMEs in manufacturing; Regulatory and accounting barriers (- lower part) operate as obstacles mainly in the construction and utilities sectors.

43 iv What s about the economic impact? Strong interest of the data user: Q8 (Has the previous investment in intangible assets benefited your company in terms of? ). However: Caveats are required by problems of: - Perception bias; - Indistiguinshable benefits: all the potential benefits highly correlated for the respondents.

44 iv What s about the economic impact (cont d)? Dimension 2 (vertical axis): distinguishes firms that indicated a lot, rather than some or little impact along the indicated economic realms. How does dimension 2 score?

45 iv What s about the economic impact (cont d)? Economic impact of intangibles more clearly reported by large enterprises (but in construction and utilities) than small ones; However, dimension 2 scores positively overwhole only in services.

46 Conclusions and policy implications. Systematic evidence on intangibles to cross-check with countrysurveys: e.g. consistencies and inconsistencies with the UK IIA. Interesting results: 1. Internal intangible intensity pivotal for firms and SMEs in particular public support to internal investments and higher accountability of internal intangibles; 2. Organizationally separable and non-separable keys for different firms (e.g. manufacturing vs. services, technological vs. nontechnological innovators) tailoring intangible support to different innovators and resolving the accounting bias against inseparables; 3. R&D is the unique intangible large firms (only) use intensively for innovation support to other intangibles as assets with longlasting returns, with possibly indirect innovation impact (e.g. AC).

47 Conclusions and policy implications (cont d). 1) Internal intangible intensity : Fiscal incentives to make intangibles more important than supporting buy of intangibles (transfer); Supporting internal development of intangibles could help Europe closing its US-gap; Making internal intangibles emerge more evidently from accounting data and national accounts. 2) Organizationally separable and non-separable intangibles : Matching the support to intangibles investments with the innovative profile of the targeted firms (e.g. R&D and software investments for product/process innovations); Making non-separable intangibles emerge more evidently from accounting data (in particular for service firms pursuing organizational innovations).

48 Conclusions and policy implications (cont d). 3) Use of intangibles for the sake of innovation : Supporting innovation projects mainly amounts to supporting R&D investments, but for large (mostly manufacturing) enterprises only. Supporting the firm s capabilities to master and/or absorb the knowledge outcomes of their intangible activities is a crucial policy target (open innovation paradigm?).

49 Thanks for attention