Innovation can be defined as the adoption of new products, processes, marketing or organisational approaches that create a valuable outcome in terms of financial benefit, wellbeing or efficiency, to name a few. Given its impact on smart, inclusive and sustainable growth, innovation is at the heart of European policies and one of the priorities of the Dutch Presidency of the Council of the European Union for the first six months of 2016. The innovation process occurs in an ecosystem in which companies, public research institutions, financial institutions and government bodies interact through the exchange of skills, knowledge and ideas. The model of open innovation is used to describe the flows between these actors.
New insights on the innovation process and the organisation of the innovation ecosystem lead to the requirement to design a new policy mix that includes, above all, policies in support of research and development to foster innovation; policies for education and training to provide the workforce with the relevant skills; and policies to promote a sound business environment and to encourage engagement in innovation and entrepreneurship.
In addition to supporting the more technical aspects of the innovation process and ecosystem, these policies also need to spur the development of a culture of innovation which involves creative thinking, collaboration, initiative, openness, a positive approach to failure, and high trust within organisations and society as a whole. Despite its positive aspects, innovation is capable of inducing potential long-term negative social, environmental or economic outcomes. Approaches involving responsible ways of undertaking research and innovation, as well applying the precautionary principle, aim to address these shortcomings.