Innovation in Business and collaboration with Universities

Banca d'Italia analyzes the effect of collaboration with universities on the innovation of Italian companies.

23 Mar 2023
T-GEN T-GEN

Innovation activities are increasingly crucial for the economic survival of companies. Rapid technological changes, shorter product lifecycles, and globalization processes have transformed the competitive environment.

In the process of knowledge creation within companies, a potential channel to enhance innovation is to have access to external knowledge to integrate with in-house ideas and technologies.

Does cooperation with universities stimulate the innovative performance of Italian companies?

To answer this question, analysts at Banca d'Italia have distinguished three different types of innovation:

  • Purely organizational innovation
  • Pure technological innovation (new products or production processes)
  • Joint innovation, which occurs when companies introduce both organizational and technological changes.

According to managerial literature, joint innovation activities are more likely to translate new ideas into market successes. The presence of a common strategy that goes beyond the launch of new products and services, also involving new business and management models, is often the determining factor.

Banca d'Italia's research highlights that:

  • cooperation with universities encourages companies to adopt this systemic approach to innovation (Universities not only promote technology transfer, but also the transfer of knowledge, making the innovation process more pervasive)
  • companies that do not collaborate with universities tend to focus on purely technological innovations.

The analysis uses data collected in 2007 and 2010 from the Survey of Industrial and Service Companies (Invind) conducted by Banca d'Italia.

Conclusions

Collaboration with universities does not encourage additional technological innovation, but increases the likelihood that companies will adopt a strategic joint innovation, which includes both technological and organizational improvements. The results, based on data collected over the last decade, suggest that collaboration with universities can be particularly useful for Italian companies in reducing the technological gap and increasing productivity.

However, this empirical evidence contradicts the low percentage of Italian companies that collaborate with one or more universities, as confirmed by the most recent available data based on CIS 2018. Further efforts are needed to stimulate business-university collaboration in Italy.

Source: Banca d'Italia | Firms' Innovation and University Cooperation. New Evidence from a Survey of Italian Firms (Daniela Bragoli, Flavia Cortelezzi, and Massimiliano Rigon).

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