Background

What is innovation and why is it important?

''Innovation is producing something new, whether that is a service, a product or the development of a new market'' – Martin Schuurmans, former Chairman of the EIT Governing Board at the Lisbon Council’s 2010 Innovation Summit.

Innovation: key to our future

Innovation is the key to growth, competitiveness and thus social well-being in the 21st century. The capacity of a society to innovate is crucial in an ever more knowledge-intensive economy, and society’s success is increasingly being determined by its ability to adapt quickly to the fast pace of development, to be one step ahead in providing solutions to rapidly emerging societal problems and to develop products that meet the demands and desires of consumers.

To illustrate the link between innovation and growth: creating something new necessitates a whole chain of different actions from conception to end-result and involves many different actors along that chain: from the initial conceptualisation, research into the feasibility of an idea, the development of the product itself, the development of the business strategy surrounding the product, the marketing and internationalisation thereof, to mention but a few.

As a result, new innovative products and services have the potential not only to dramatically alter the shape of our society by virtue of their ingenious solutions, but also to create significant employment opportunities and growth.

EU innovation gap and birth of the EIT

The concept of the EIT was developed within the framework of the Lisbon Strategy for Growth and Jobs, specifically to address Europe’s innovation shortcomings.

Originally put forwards in 2005 as part of the mid-term review of the Lisbon strategy, the initial European Commission proposal was based on the results of a wide public consultation taking into account more than 700 contributions by experts and the general public, and various stakeholder position papers.

It is clear that Europe could – and must - do much better at innovation. Although there are excellent European education and research institutions, they are often isolated from the business world and do not obtain the "critical mass" necessary for innovation. They are fragmented not only geographically but also thematically, in that they do not work together to create market-driven solutions. As stated by Ján Figel’, European Commissioner for Education, Training, Culture and Multilingualism at the time of the EIT’s conception, ‘Europe consistently falls short in turning R&D results into commercial opportunities, innovations and jobs’.

The Commission concluded that a solution was needed to address five specific areas of concern in Europe:

• the difficulty in translating R&D results into commercial opportunities,
• the difficulty in reaching critical mass in certain fields,
• the fragmentation of the EU’s research and higher education system, which does fully use the excellence that exists in Europe,
• the lack of innovation and entrepreneurial culture in research and higher education,
• the lack of critical mass in small and medium sized enterprises.

The solution sought would focus on integrating fully the three sides of the so-called "Knowledge Triangle", i.e. the Higher Education, Research and Business sectors. And thus the novel approach of the EIT was born.
The EIT vision and approach were first submitted in a European Commission Communication in February 2006, and subsequently approved by the Council and the European Parliament. The EIT Regulation entered into force in April 2008, and the EIT Governing Board held its first meeting in September 2008. The EIT became operational with its own staff and out of its Budapest location in April 2010.

Although the concept has been refined and developed since its conception, the basic proposition remains the same: the EIT seeks to allow Europe's excellent universities, research centres, businesses and other innovation actors to grow and capitalise on their innovation capacity and capability. In doing so, it will stand out as a world-class innovation-orientated reference model, inspiring and driving change in existing education and research institutions. By boosting the EU's capacity to transform education and research results into tangible commercial innovation opportunities, the EIT will further bridge the innovation gap between the EU and its major international competitors. The EIT will favour sustainable economic growth and job creation throughout Europe by generating new products, services and markets responding both to public demand and to the needs of the knowledge economy.

What is different about the EIT?

Its concept: the Knowledge Triangle

The EIT is the first EU initiative to fully integrate all three sides of the Knowledge Triangle (higher education, research and business) by way of so-called Knowledge and Innovation Communities (KICs). The link between all three sides and the effective transmission and sharing of knowledge, information and skills for joint exploitation is crucial to delivering the jobs and growth opportunities that Europe is seeking, because excellent researchers, students and entrepreneurs working in isolation are much less efficient in delivering the results needed and wanted by the market and consumers.

By connecting European business and research, businesses stand to gain as they will be given fresh opportunities to commercialise the most up-to-date and relevant research findings, with the aim of giving Europe first-mover advantage in the latest technological and non-technological fields as well as in open innovation. In return, research organisations will benefit from additional resources, an enhanced networking capacity, and new research perspectives stressing interdisciplinary approaches in areas with strong societal and economic importance. By adding higher education into the mix, businesses will be able to take advantage of a workforce with skills tailored to their needs able to drive their market share forwards; and students will benefit from an education that will make them more attractive to future employers and also more apt at contributing to the development of those employers’ businesses.

Bringing entrepreneurship to the fore

Innovation needs entrepreneurial people. One of the EIT's main objectives is therefore to create a favourable framework for promoting a fresh entrepreneurial culture in Europe. Through its business-oriented approach as well as through its educational component, the EIT will help to train a new generation of entrepreneurs, who have the right skills and knowledge to turn ideas into new business opportunities.

Higher education and the EIT: a new approach to learning

In the past, higher education has notoriously been the absent member of innovation partnerships. However, new skills and talents will be crucial to the concrete exploitation of Europe's innovation potential and the EIT will advocate the change of mindset required to make this possible. Participating higher education institutions will offer prestigious Masters and PhD degrees which will be encouraged to bear an "EIT" label in order to reflect their high quality and innovative character. Business partners will benefit directly from new education programmes integrating entrepreneurship, innovation and risk management as core modules.

Its governance: a two-level structure

In order to foster new ideas and inspire innovation, the EIT combines expertise with a vision. Decisions can be taken on the sole basis of expertise and visions can be implemented without unnecessary constraints. This is a result of the EIT's light two-level structure, which combines an efficient governance structure with a solid operational base, drawing upon Europe’s most excellent innovation actors.

A fully independent Governing Board, comprising a balance of high-calibre professionals from business and academic backgrounds. The Board provides strategic guidance, and co-ordinates, stimulates, and facilitates the integration of partner organisations. It is supported by the EIT Headquarters, a streamlined, non-bureaucratic administrative structure for greater efficiency. The EIT’s strategic priorities are laid down in a seven-year draft "Strategic Innovation Agenda (SIA)" outlining the EIT's long-term vision, priorities and financial needs. The EIT’s SIA was submitted to the European Commission on 15 June 2011. The Commission will present a proposal for the first SIA to the Council and the European Parliament by 31 December 2011 at the latest. The final SIA will be published once the European Parliament and Council have adopted it, based on the European Commission's proposal.

Operational base

Top-class businesses, research centres and universities form the highly integrated, excellence-driven partnerships known as Knowledge and Innovation Communities (KICs), accumulating the necessary “critical mass” for excellence in innovation. They are the EIT's operational powerhouses, taking new ideas to the market. Direct involvement of business stakeholders, including SMEs, in all strategic, operational and financial aspects of the Institute is the cornerstone of the initiative.

The KICs are selected by the EIT Governing Board on a strategic basis as responses to the foremost challenges currently facing the European Union. Because the EIT represents a novel approach to innovation at EU level, it needs to be set up gradually based on a phased implementation in view of its long-term development perspectives. The first three KICs address the following themes: climate change adaptation and mitigation; renewable energy, and the future information and communication society. Future KIC themes have been proposed by the EIT in its SIA for the period 2014 – 2020.

KICs will form enhanced partnerships within the innovation web, sharing common strategies and objectives, and going beyond traditional networks of innovation actors in terms of scale, ambition and life-span (7-15 years). They will seek to form strong innovation cultures and identities, driven by common visions and goals, and to build innovative "webs of excellence".