Where is the economic dynamism, where is wealth created, what are the drivers of innovation? Where are we today in terms of territorial dynamics and innovation dynamics?

The National Academy of Technologies of France devoted its 2017 annual seminar (11 and 12 October) to studying this vital subject for France. This seminar shows that at a time when France has experienced both a territorial reform (NOTRe law of 2015) and a metropolitan development of (MAPTAM law of 2014), and multiple initiatives aimed at developing its potential for competitiveness and innovation, the challenges of innovation in the territories are still fundamental.

France, a country well placed in R&D spending but less so in terms of innovation?

The 2018 European Innovation Scoreboard ranks France 9th, with a performance close to the European Union average, with no significant change since 2010. The explanation comes from a problem of the efficiency of innovation processes, and not from a lack of resources devoted to innovation in terms of R&D spending or human capital (France ranking between 5th and 9th on the resources indicators).

– Innovation is only secondarily technological. Innovations are, in fact, multiple: disruptive or incremental, it is generally accepted that 20% of innovations are technical in nature and 80% are social, organisational, commercial, marketing or financial in nature (Godet,2010). Innovations are often based on the ability to rethink business models, economic and social activities and relationships between players in the value chain (e. g. “ubérisation”), rather than on major technical projects alone. Innovation requires being creative and inventing but, more importantly, going downstream in the value chain, integrating design, marketing and user experience, alone and, above all, in a network. For this, managerial and entrepreneurial skills are essential. How to stimulate them?

– Connect the players and strengthen valorisation. More than ever, innovation requires cooperation between research and training institutions, companies and other local players. Numerous actions have been undertaken, both to enhance the value of public research (Allègre incubator, 1999, Carnot Institutes, 2006, Technology transfer acceleration companies, 2010, regional technology transfer platforms, 2013) and to better connect private and public players (competitiveness clusters, 2004, Technological Research Institutes/Energy Transition Institutes (IRT/ITE), 2010). The assessments emphasize that the results are favourable when the mechanisms are based on pre-existing dynamics (example of Grenoble), and take into account the need for working for the long term.

– Create for growth. Innovation can be achieved through new activities within existing companies, but also through spin-offs and the creation of innovative companies (star t-up).
France is now praised for being on the world podium of large patent filing companies (Top 100 Thomson-Reuters surveys), but – despite progress – the situation is lagging behind for the rest of the productive fabric: lack of mid-cap champions and SMEs still to be stimulated despite the impact of competitiveness clusters.

The creation of spin-offs based on non-strategic innovations for large companies is still lagging behind and, even more so, the challenge is now to enable the growth of innovative companies. Indeed, while France now appears to be an important player in the creation of innovative companies, they remain small in size (2 to 3 employees). Too few unicorns, i.e. companies under 10 years old whose value exceeds $1 billion, are French. Is this embarrassing? Not if the innovations of start-ups contribute to the creation of new activities in France. Yes if start-ups achieve their development abroad… Fostering the development of spin-offs and start-ups in France is then as important as encouraging their creation.

How to improve the efficiency of the French innovation system?

The territorial dimension is central. Innovation is based on the ability of local players – ecosystems – to be mobilised for building innovative projects. Stimulating the energy of entrepreneurs is essential, but to do so, building cooperation between local players – local authorities, companies, research and training centres – is no less crucial. In addition, the focus on the Region is reinforced by national reforms (CCI reforms, NOTRe law of 2015) and European policies (Smart Specialisation Strategy).
Metropolisation (A Trend) Or Metropolarisation
Metropolises, these urban areas with more than 500,000 inhabitants, are essential players in the regions. However, recent years have seen a new phenomenon: the increasing metropolisation of activities. The urban area of Paris and the dozen or so of other regional urban areas are experiencing both stronger growth in their activities and more jobs with good potential than the rest of the territories (61% of managers, engineers, etc. are located in these metropolitan areas). It is then necessary to elucidate the role of metropolises in the dynamics of innovation.
However, a precise analysis raises multiple questions about “metropolarisation”, seen as a homogeneous and unavoidable trend. On the one hand, there are significant disparities between metropolitan areas: they differ in their specialisations, but also in terms of performance! Occitania or New Aquitaine thus contrast sharply with Normandy, the “Grand Est” or the less dynamic “Hauts de France”. On the other hand, relations within metropolitan areas, between the centre and the periphery, are diverse.
Beyond an imagined homogeneity between metropolises, the trajectories diverge: some territories, on the periphery or outside the metropolises, maintain a notable dynamism (example Vendée or Bressuirais). Understanding how to create or stimulate innovative territories is then necessary.
This seminar focused – without being exclusive – on four players and initiatives that are crucial in this dynamic process:

– Competitiveness clusters: more than 10 years after their creation, the 67 competitiveness clusters now seem to be proving their impact on R&D spending and having a positive effect on the SMEs that join them. The challenge of the transition to the market is now in the forefront;

– The role of chambers of commerce and industry (CCI): as central players in local economic development, the 150 institutions that make up the CCI network have undergone both financial and operational reforms. They appear more than ever as the go-between the different entities of the economic fabric, the coaches of local companies, while having a significant training activity (620 000 people trained each year by their 500 training institutions);

– The role of universities and engineering schools: since the Allègre law and the Pécresse law on university autonomy, the French higher education system has been engaged in the development of activities to promote research, while undergoing regular overhauls and reforms (mergers, COMUE – Communities of Universities and Establishments);

– The role of the vocational training system is essential both for employees, who are required to undergo lifelong training, and for companies that are looking for skills. This vocational training system is at the heart of reforms that lead us to think about how it can be linked to regional training needs.

Finally, the last chapter placed the work carried out in an international perspective, underlining, on the one hand, how much the dynamics of wealth creation and income distribution identified at the French level are also present at the European level and, on the other hand, showing how Flanders has been able to strengthen its territorial innovation dynamics over the past ten years.