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Innovation ecosystems require "systems integrators"

John Howard, April 10, 2024


There is strong policy interest in nurturing and growing innovation ecosystems as “sets of interacting internal and external actors that support and reinforce one another in creating new knowledge, methods and technologies toward self-renewal and long-term sustainability for the collective whole” (Cheng et al., 2020).


Ecosystems may be in the form of what are otherwise termed regions, districts, precincts, and hubs.  


But do these place-based institutional forms reflect convenient co-location rather than a wellspring of genuine knowledge spillovers and "triple helix" effects of collaboration and institutional convergence between technology-intensive businesses, research universities, public research organisations, and governments?


In recent years a great deal of research has been applied to identifying and “mapping” innovation ecosystems using location and agglomeration analysis. There is often a presumption that co-location delivers logical connections between participants, sometimes represented in complex maps or wiring diagrams.


A “logical connection” does not mean that actual organisational connections and human interactions are present, that information and knowledge flows are occurring, or that valuable spillover benefits are being delivered.


Connections may be little more than contractual and transactional relationships between suppliers and customers — or creators and users of knowledge. The concept of an Innovation Intermediary was developed to facilitate this form of knowledge exchange and transfer. 


In application, innovation is an interactive process with strong social, spatial, physical, and technological linkages between people and organisations. Innovation ecosystems have all the hallmarks of highly complex adaptive systems.


In that context, the discussion of innovation intermediaries must move into an analytic framework of systems integration that develops cooperation, collaboration, partnership, and trust-based relationships among participants.   


Innovation ecosystem integrators are organisations that specialise in joining different components to create a cohesive and functional system. They work towards connecting participants and introducing new participants. That is a very considerable task, and its significance should not be overlooked.


Generally, integrators facilitate delivery and access to start-up funding, provide advice on commercialisation and knowledge transfer, deliver mentorship and coaching, promote collaboration and networking, provide resources and infrastructure (facilities and equipment, office space), advocate for public infrastructure, provide education and training, run innovation contests, facilitate access to markets and generally foster a culture of innovation,


Ecosystem integrators may be member-based or government-funded entities, universities, private companies, industry associations, non-profit organisations, or start-up accelerator programs.  


The Acton Institute for Policy Research and Innovation has commenced a project to understand how innovation system integrators create value in Australia and internationally. The project is looking at business models, governance structures, and funding. The project will also seek to identify better practices for an Australian context.


An ecosystem can still function without a system integrator, but it may be less efficient, effective, and coordinated. Start-ups may have more difficulty accessing resources and expertise, and business-to-businessness and business-to-government collaborations and partnerships may be less common.


Without a system integrator, there may be less (or no) coordination and communication within the ecosystem, leading to less effective use of resources and a less cohesive community.


The project will cover a range of contemporary issues concerning effective innovation ecosystem performance, including:

  • The extent to which place-based investments in physical and human capital formation are sufficient to create an innovation ecosystem, and whether an innovation district driven by an objective of urban renewal will operate as an innovation ecosystem beyond normal agglomeration effects.

  • The impact of remote working options and strategies arising from technology professionals’ location priorities and preferences, greater knowledge-worker mobility, and individual concerns over safety in innovation ecosystem locations.

  • The mix of economic, socio-cultural and sustainable development objectives, particularly about creating jobs, addressing social inequality, affordable housing, access to healthcare, and amenities, such as parks, restaurants, and cultural activities, encouraging the use of renewable energy, and promoting energy efficiency in the construction of energy-efficient buildings and infrastructure.


These matters are or are likely to be, an increasing concern to systems integrators and urban and regional development policymakers.


For inquiries, contact Dr John Howard, Executive Director, Acton Institute for Policy Research and Innovation at john@actoninstutite.au

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