The Ministry of Economic Affairs and Employment, the Finnish Funding Agency for Innovation TEKES and the Finnish Innovation Fund SITRA organised in autumn 2016 an international workshop to compile international research data on developing ecosystems. Totti Könnölä, CEO of Insight Foresight Institute, presented the paper “Co-creating Pan-European Innovation Ecosystems: reflections from the EIT”. Industrial Policy for New Growth Areas and Entrepreneurial Ecosystems Research workshop in Helsinki 28.-29. November 2016 Convenors: Timo Hämäläinen, Sitra and Antonio Andreoni, SOAS University of London Organizers: Sitra, Tekes & MEE Invited lecture

1. EUROPEAN INSTITUTE OF INNOVATION AND
TECHNOLOGY: POLICY EXPERIMENTATION FOR
PAN-EUROPEAN INNOVATION ECOSYSTEMS
Industrial Policy for New Growth Areas and
Entrepreneurial Ecosystems
Research workshop in Helsinki 28.-29. November 2016
Convenors: Timo Hämäläinen, Sitra and Antonio
Andreoni, SOAS University of London
Organizers: Sitra, Tekes & MEE
Invited lecture
José Manuel Leceta & Totti Könnölä
Insight Foresight Institute (IFI), Madrid, Spain
Twitter: @IFI_Institute
Web: www.if-institute.org/
Email: info@if-institute.org

2. EIT was set up in 2008 to
promote and strengthen
synergies and cooperation
among businesses,
education institutions and
research organisations
through Knowledge and
Innovation Communities (KIC).
EUROPEAN INSTITUTE OF
INNOVATION & TECHNOLOGY (EIT)

3. FEW ACADEMIC ANALYSIS ON THE EIT
Studies around its foundation (Jones, 2008; Jofre et al, 2009; Gornitzka and Metz,
2014; Didier, 2010; Tindemans and Soete, 2007; Huisman and de Jong, 2014)
Key performance indicators for the EIT to steer its operations. Rohrbeck and Pirelly
(2010)
Thematic priority areas for a new wave of KICs. Haegeman et al (2012)
Networked foresight in one of the KICs. Heger and Boman (2015)
There is no substantive research about the EIT’s “setup” (2009-2010) and “consolidation”
(2011-2014) periods.
Missing the ‘insider view’ from the EIT Headquarters to learn from the EIT model and
management practices as a European innovation policy experiment.
25 November 2016 3

4. OUR APPROACH AND OBJECTIVE
Our empirical analysis on the EIT builds on the action research
(Checkland, 1981; (Argyris et al., 1985)
The authors are former EIT employees over the period of 2011 and
2014.
­ Interviews across the EIT community & day to day interaction subject to
interpretation biases (Yin, 2003).
­ Attested by proofs documented in empirically grounded materials developed by the
EIT and its stakeholders.
The paper examines EIT practices as a policy experiment and opens up
an avenue for further work on governance of Pan-European Innovation
Ecosystems.
25 November 2016 4

5. PREMISES: SCHUMPETERIAN DEVELOPMENTAL
AGENCIES & PAN-EUROPEAN INNOVATION
ECOSYSTEMS
A new paradigm, from project collaboration to long-term partnerships for
enabling ecosystems:
­ Capitalising on existing capabilities and alignment of public support available in Europe;
­ Bottom-up community-driven partnerships for co-creation and multilevel synergies;
­ Focus on the emergence and growth of world-class young dynamic firms
(‘yollies’)/scaleups;
­ Acceleration, the exploitation of tacit knowledge and addressing societal challenges.
‘Schumpeterian developmental agency’, continuous policy experimentation
(Kuznetsov, 2009). Breznitz and Ornston (2013):
­ at the periphery of the governmental structures, in low-profile set ups with relatively few
hard resources and limited political prestige and less vulnerable to political interference.
25 November 2016 5

6. ENTREPRENEURIAL INNOVATION
ECOSYSTEMS
Ács et al. (2014)
­ “National System of Entrepreneurship is the dynamic, institutionally embedded interaction between entrepreneurial attitudes, ability, and
aspirations, by individuals, which drives the allocation of resources through the creation and operation of new ventures.”
Russell et al (2011
­ Innovation ecosystem entails: “the inter-organizational, political economic, environmental and technological systems of innovation
through which a milieu conducive to business growth is catalysed, sustained and supported. An innovation ecosystem is a network of
relationships through which information and talent flow through systems of sustained value co-creation.”
Entrepreneurial innovation ecosystem:
“the dynamic, inter-organizational, political, economic, environmental and technological milieu of…
interaction between entrepreneurial attitudes, ability, and aspirations, by individuals, and moderated by
institutions, …
which drives knowledge and value creation towards the structural change and the enhanced allocation of
resources.”
Herein, we consider a Pan-European entrepreneurial innovation ecosystem the one that wires up local
ecosystems across Europe (see also Pombo-Juárez et al, 2016).
25 November 2016 6

7. CASE STUDY: THE EIT –
A POLICY EXPERIMENT
7

8. THE EIT: A POLICY EXPERIMENT
The EIT, an experimental shift from today’s EU-level
interventions and current emphasis in trans-national
collaborative projects (in R&D) to a new paradigm in
fostering Pan-European innovation ecosystems.
25 November 2016 8

9. • Climate-KIC:
Co-location Centre
RIC (Regional Implementation
and Innovation Centre)
• EIT ICT Labs:
Co-location Centre
Associate Partner
• KIC InnoEnergy
Co-location Centre
(**) Composite map of CLCs for the three first KICs
THE FIRST 3 KICS’ HOT SPOTS
9

10. POLICY EXPERIMENTATION WITH
BUSINESS LOGIC AT EIT: KIC DESIGN
­ Business logic
­ an independent legal entity, gathering
knowledge triangle partners; a minimum
of 7 years to eventually become self-
sustainable
­ governed by a Board of KIC partner
organisations; run by a CEO and a
management team
­Investment logic
­ EIT funding to KICs is max. 25 %
­ KICs’ Business Plan with measurable
deliverables, results and impact.
­ The investment culture is promoted
25 November 2016 10

11. THE EIT MANAGEMENT AGENDAS
i) Monitoring
­ EIT Governing Board defined a Scoreboard which the EIT further elaborated jointly with the three KICs into a
Performance Monitoring System (PMS); applied as one of the criteria to determine the annual funding allocation.
ii) Simplification
­ Access and exit of European partners in the KICs as “living partnerships”
­ Empower KIC Legal Entities for secure internal controls vis-a-vis their KIC Partners.
­ Setting up criteria to select projects at KIC level.
­ ‘Derogations’ for approval by EU institutions; e.g. SMEs and individuals do not need to become formal partners to
receive financial support.
­ Since 2014 part of the Horizon 2020.
iii) Dissemination
­ Dissemination of results and practices through studies and conferences; EIT Stakeholder Forum.
25 November 2016 11

12. EIT AND ITS INITIAL IMPLICATIONS ON
POLICY AND PRACTICE
Towards networked excellence in enabling spaces
­ KICs’ operations in five to six innovation ‘hot-spots’ or so-called ‘co-location centres’ (CLCs) which the
amended Regulation in 2013 finally defined as follows: "co-location centre" means a geographical area
where the main knowledge triangle partners are based and can easily interact, providing the focal point for the
KICs’ activity in that area".
Beyond mobility, trans-national incubation and acceleration
­ While CLCs work together, exploit and take advantage of their diversity, thereby fostering actual synergies
and complementarities across European borders.
­ CLCs to facilitate ‘soft landing’, mutual exchange of support, exposure of the start-up business plans to
other marker environments, match-making international partners along the value chains to scale up trans-
national impact, etc.
­ KICs facilitate opportunities to high growth potential ventures which can be nurtured and their growth
accelerated with large corporations in the KIC partnerships.
25 November 2016 12

13. Concluding remarks
CONCLUDING REMARKS

14. DISCUSSION
KICs impact and their legal and management set up fit remain to be seen.
­ ‘Too large’ communities risk losing the focus and even leading to incremental rather than radical and/or disruptive innovations.
Monitoring – measuring impact
­ Both in societal and economic terms, including behavioural additionality.
Simplification – a ‘trusted partner’
­ KIC financial reporting, simplified costs, risk assessment incl. systematic ex post and ex ante verifications, and applying
financial instruments either alone or in combination with grants.
Dissemination
­ New innovation models and bringing about a systemic change to the European innovation landscape.
Design of multi-level initiatives developing international (or Pan-European) innovation ecosystems.
­ ‘Clusters of innovation’ (Engel and del-Palacio, 2009; Engel, 2014)
25 November 2016 14

15. CONCLUSIONS
The EIT is building Pan-European innovation ecosystems but KICs still to
demonstrate their strengths.
­The sustainability of KICs after the seven years commitment is open.
The EIT was proposed by former President Barroso and this created
high expectations leading to risk averse governance sometimes over
innovation and experimentation.
­Hence, with hindsight, similar kind of initiatives could benefit from some more
distance to political spheres and from higher autonomy to operate.
25 November 2016 15

16. ACKNOWLEDGEMENTS
We are grateful to Professor Gonzalo Leon (UPM) and anonymous reviewers for their
comments to the earlier versions of this paper.
The preparation of the paper was made possible due to the financial support of
Madrid-based Insight Foresight Institute specialised in transforming innovation and
entrepreneurial ecosystems.
The opinions presented in the paper are the authors’ only and do not represent an
official view of the European Institute of Innovation and Technology.
25 November 2016 16

17. www.if-institute.org
info@if-institute.org
@IFI_Institute
Insight Foresight Institute (IFI)
Avda. Concha Espina, 8-1 Dcha.
28001 Madrid, Spain
THANK YOU!
“With us, achieve game-changing strategies, implement
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18. Ben Martin (UK)
•SPRU, Univ. of Sussex
•(University of Cambridge)
Charles W. Wessner (US)
•Georgetown Univ.
•(National Academy of Sciences)
Dan Breznitz (CA)
•University of Toronto, Munk School of
Global Affairs, Georgia Tech Enterprise
Innovation Institute
•(Georgia Tech, MIT)
Dirk Pilat (NL/FR)
•Deputy Director of the OECD Directorate
for Science, Technology and Innovation
•(OECD Committee on Industry, Innovation
and Entrepreneurship)
Emma Fernández (ES)
•Advisor, Corporate Leader
•(Indra)
Gonzalo León (ES)
•Vice-President of the Technology for
Defence and Security Program, CESEDEN
•(Universidad Politécnica de Madrid)
Göran Roos (SE/AU)
•Value Add and Ind. Growth, Econ. Dev.
Board in Adelaide
•(Innovation Performance Australia,VTT)
John Kao (US)
•Institute for Large Scale Innovation
•(Global Advisory Council on Innovation of
WEF, Harvard Business School)
Ken Guy (UK)
•Wise Guys, Ltd
•(OECD, EC JRC-IPTS, Technopolis)
Kurt Deketelaere (BE)
•LERU
•(Flemish Gov., Univ. Of Leuven)
Maria Bejuméa (ES)
•Startup Spain (South Summit)
•(Serial entrepreneur)
Mariana Mazzucato (IT/US)
•SPRU, Univ. Of Sussex
•(INNOGEN, The Open University)
Ray Garcia (US)
•European Commission, , Buoyant Capital
•(University of Pisa, MIT Media
Lab,University of Arizona)
Riel Milller (CA/FR)
•UNESCO
•(xperidox, OECD)
Ron Johnston (AU)
•Australian Centre of Innovation
•(Australian Commission for the Future)
HIGHLEVELADVISORYBOARD

19. MANAGING DIRECTOR
Totti Könnölä
Background: Impetu Solutions, EIT,UP Comillas, IE,
JCR-IPTS, VTT
DIRECTOR OF TECHNOLOGY
Francisco Jariego
Background: Telefónica
DIRECTOR OF BUSINESS DEVELOPMENT
David Cano
Background: TECOPY, IDOM
Leadership
SOCIAL CAPITAL MANAGEMENT
• Renowned global leaders and thinkers
High-level Advisory Board
• Recognised senior experts and mentors
Innovation Council
• Experts engaged in projects
Expert Network
• User-side representatives
Challenges Committee
• Strategic partner organisations
Strategic Alliances
Communities

20. ECOSYSTEM
Businesses
Academia
Government
Investors
Society
Media
“We work with businesses, governments, academia and other stakeholders to foster insight
and foresight that transform entrepreneurial innovation ecosystems with lasting impact on
society.”
OUR MISSION
The entrepreneurial innovation ecosystem is
• the dynamic, inter-organizational, political, economic,
environmental and technological milieu of
• interaction between entrepreneurial attitudes, ability,
and aspirations, by individuals, mediated by institutions,
• which drives knowledge and value creation towards the
structural change and the enhanced allocation of
resources.
(Leceta & Könnölä, 2016)

21. OUR APPROACH
Government
incl. Agencies
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incl.
Universities
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incl. Large
Firms
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