Cooperation with Scientific Institutions Drives Corporate Top Innovations
ResearchCompanies Benefit from New Products and Increased Sales When They Work Together with Public Research Organisations
According to a recent ZEW study, companies that cooperate with research institutions have a significantly better chance of successfully introducing new ideas to their market and worldwide. Cooperation between companies and scientific institutions is therefore a key driver of innovation in Germany. In addition, these companies generate higher shares of sales with innovative products. However, the results of the study also show that bureaucratic hurdles and a lack of public funding often pose significant obstacles that complicate or even prevent cooperation.
“Our analyses show that companies that cooperate with scientific institutions are up to 69 per cent more likely to develop world market innovations. These findings highlight the central role of public science in maintaining Germany's competitiveness,” explains Dr. Bastian Krieger, head of the junior research group “Co-Creation” at ZEW Mannheim. “Increased public funding and the removal of bureaucratic obstacles are crucial to fully exploit the potential of such partnerships for the German economy.”
Gaining advantage through cooperation
When companies cooperate with scientific institutions, they increase their chances of developing world market novelties – i.e. innovations that are introduced for the first time worldwide – by 69 per cent. For ordinary market innovations, the increase is still 41 per cent. In addition to the enhanced development opportunities, companies also benefit economically from such collaborations.
The share of market novelties in sales is on average 55 per cent higher for cooperating companies, and for world market novelties it is even 79 per cent higher than for companies without such cooperation. These figures underscore the central importance of scientific collaboration not only for the innovation process but also for the international competitiveness of the German economy.
Bureaucracy and a lack of funding slow down innovation
Despite the clear advantages of collaborating with scientific partners, many companies face significant challenges in attempting to do so. A lack of public funding is the most common obstacle, either preventing the start of collaboration or jeopardising existing partnerships from continuing. In addition, a lack of financial or human resources on the part of companies or scientific institutions often leads to potential projects failing before they even start or to them being abandoned.
Administrative and legal conditions also pose problems. Bureaucratic hurdles, such as complicated contract negotiations, unclear intellectual property rules or burdensome reporting requirements are the most frequent difficulties encountered by an existing collaboration and in some cases even lead to projects either being cancelled or never beginning in the first place.
