Innovation: What It Takes & Why It Matters

Posted by Sophia Barnhart

As concern grows with the slowing and struggles of various global economies, it can be difficult to be optimistic towards the future of international business. However, billionaire venture capitalist Jim Breyer disagrees with the disheartened moods shared by many of his peers and colleagues; the founder and CEO of Breyer Capital and partner at Accel Partners voices his excitement: “Innovation is happening in centers of excellence around the world faster than ever before.” The best antidote to stagnation is innovation, but it can be challenge for countries to find that certain spark of creativity that will bring them out of their lethargy. Bloomberg has compiled a list of 2015’s 50 most innovative countries, based on six tangible activities that formulaically contribute to their innovativeness.

Research and Development

World’s leader: South Korea

Why it’s important: Research-intensive countries have the ability to modernize their entire economy. From research and development come new ideas to improve efficiency and solutions to problems that hinder a country’s growth. Innovative companies that emphasize their R&D industries have the ability to participate and engage markets others can’t, as well as minimize costs that yield even better results than their competitors.

Manufacturing

World’s leader: Switzerland

Why it’s important: Bloomberg measures the value added by manufacturing, prioritizing countries that focus on high-tech output that genuinely contributes to the ability for a country to remain a global leader, such as pharmaceuticals, autos, and computers. The role of manufacturing is changing into one that provides more opportunities for productivity and global trade as a means of moving a country forward.

High-tech Companies

World’s leader: United States

Why it’s important: Measuring the ten largest tech companies by market capitalization, the United States wins by a landslide—in fact, the vast majority of those top ten companies are American. Boasting tech giants like Apple, Google, and Microsoft, it’s no question that the sheer power of American tech sector contributes significantly to the world’s innovativeness.

Postsecondary Education

World’s leader: South Korea

Why it’s important: Clearly, education can be a strong indicator for innovativeness; however, many countries that support strong education policies are hardly competitors when it comes to global innovation. Bloomberg uses four different methods to measure the education level of a country’s workforce. While South Korea dominates overall, these countries topped the individual standards but failed to generate enough opportunities for their new college grads:

Greece: #1 in postsecondary education as a percentage of college-age population

Russia: #1 in the percentage of the labor force with a postsecondary degree

Tunisia: in annual new science and engineering graduates per thousand people in the labor force AND #1 in annual science and engineering graduates per thousand postsecondary graduates

Research Personnel

World’s leader: Finland

Professionals working in R&D per 1 million population

Why it’s important: With no creative minds, there can be no innovative research. While a country’s size can contribute to other resources for innovation, that isn’t the case when it comes to engineering talent; among the top five are small, prosperous nations like Iceland, Denmark, and Singapore. These small countries have developed their own strength in research tech that flourish in their more open economies. Developing these technologies allow the entire world to reap the benefits, as less-developed countries can innovate by adopting and adapting this research.

Patents

World’s leader: South Korea

Why it’s important: Patents reflect and protect innovative ideas, forcing others to invent their own ideas. However, this can hinder inventors as patented existing technologies could otherwise have offered opportunities for innovation. That being said, countries like South Korea that host many patent holders are generally top competitors in science and tech industries.

As your company undergoes its global expansion, it’s vital to understand how to rank your prospective country markets based on their growth and success as well as their relevance to your product or service offering. Innovative countries hold promising economies that welcome incoming business in order to share and capitalize on their wealth of knowledge. Targeting countries that specialize in entrepreneurship and experimentation makes for a smart strategy for investors and marketers. Will these top innovators be on your radar? For more information on how we can help your company improve your globalization efforts, visit us at www.ondemand.lionbridge.com.