Recent work on the relationship between technological development, innovation and economic performance has focused on the concept of the "national innovation system". In this, the emphasis is not just on the constituent actors within that system—firms, universities, government research laboratories and so on—but more importantly on the relationships and linkages between them. The notion of a national innovation system was first described by Professor Freeman (from SPRU) in relation to Japan; he defined it as "the network of institutions in the public and private sectors whose activities and interactions initiate, import, modify and diffuse new technologies².The concept has since been developed by others and fleshed out with various empirical studies³. (A useful summary of the concept and these empirical studies can be found in a recent OECD report⁴.)

  The concept of the national innovation system has come to prominence for several reasons. One is the growing economic importance of knowledge, with many economic activities becoming increasingly knowledge-intensive. A second and closely related reason is the widening range of institutions involved in knowledge generation⁵. Another reason is the emerging interest in systems approaches to the study of technological development, not least because of widely recognised limitations of the traditional linear model of innovation⁶.

  As the foresight exercise in the UK (and indeed foresight activities more globally) have all demonstrated, many important potential innovations and the emerging generic technologies likely to underpin them are characterised by the confluence of a number of component technologies⁷. This creates the need for multi-disciplinary, multi-institutional and even, in a number of cases, multinational effort, and hence for networks, co-operation and partnerships. The development of such networks is becoming more crucial.

  At the heart of the concept of the national innovation system is a belief that a better understanding of the linkages between the component actors in the system is the key to improved technological performance:

The national innovation systems approach stresses that the flows of technology and information among people, enterprises and institutions are key to the innovative process. Innovation and technology development are the result of a complex set of relationships among actors in the system. For policy-makers, an understanding of the national innovation system can help identify leverage points for enhancing innovative performance and overall competitiveness. Policies which seek to improve networking among actors and institutions in the system are most valuable in this context⁸. (original emphasis)

  The policy implications of the national innovation system concept are far-reaching. As OECD has argued, it suggests a new rationale for government funding of research and technology based on correcting systemic failures—in other words, the lack of effective interactions between the actors in the system. It also points to the need for new types of policies to address those systemic failures, policies that develop, extend and strengthen the communication and the flows of information, and the networking, co-operation and linkages between the component organisations that make up the national innovation system⁹.

  On the basis of experiences with the Foresight Programme in the UK and similar activities in other countries (eg Germany, Japan, the Netherlands, Australia), foresight would seem to offer a fruitful mechanism for pursuing such policies. In particular, the process benefits have proved substantial¹⁰. These process benefits are captured in "the five C's"¹¹:

—  foresight has enhanced Communication (among companies and among researchers, and between researchers, users and funders);

—  it has resulted in greater Concentration on the longer-term future;

—  it has provided a means of Co-ordination (again among researchers, and between researchers, users and funders);

—  it has helped create a level of Consensus on desirable futures over the next 10-20 years;

—  it has generated Commitment to turning the ideas emerging from the foresight programme into action.

  These five C's correspond to areas where the UK was previously perhaps rather weak in comparison with countries such as France, Germany and Japan. Foresight provides a mechanism for developing strategies without engaging in top-down planning.

  These process benefits associated with foresight are very much concerned with fostering productive long-term partnerships and networks—among researchers and among firms, across industrial sectors, and between industry, universities, government and society at large. Thus, foresight offers a means of "wiring-up" and strengthening the connections within the national innovation system so that knowledge can flow more freely among the constituent actors, and the system as a whole can become more effective at learning and innovating.

  The above arguments are also related to notions of organisational learning (within an organisation) and system-wide learning (in this case, in the national innovation system). Such learning requires a process for stimulating, nurturing, encouraging and strengthening interactions between the actors so that the linkages between them become more permanent. In the case of system-wide learning, we need a process capable of wiring up the national innovation system so that it too becomes more effective at learning. The more this wiring up takes place, the more effective the national innovation system should become in terms of learning and hence innovating. Foresight is a process for achieving this goal.

  Mathews has made a similar point in relation to "high technology" industrialisation in East Asia, arguing that such industrialisation depends on the level of interdependence between the players involved. "The more sophisticated this network of institutions, the faster the economic learning, and the more secure the process of high technology industrialisation"¹². From this, he develops the concept of the "national system of economic learning". Whereas organisational learning is concerned with each organisation learning individually, economic learning involves learning in the wider industrial system comprising the interactions between firms, the market and the state more generally.

  Technology foresight offers a means to facilitate such economic learning. With this should come an increase in the "knowledge distribution power" of the national innovation system¹³ and hence in its capacity for innovating. Effective knowledge-distribution and learning are becoming ever more important as we move towards the knowledge-based economy. To strengthen the national innovation system, we need to stimulate, extend and deepen those interactions if the system is to learn and innovate more effectively. The Foresight Programme is providing a fruitful mechanism to help achieve this.

REFERENCES

  1  This memorandum draws upon B R Martin and R Johnston, Technology Foresight for Wiring Up the National Innovation System: Experiences in Britain, Australia and New Zealand. Technological Forecasting and Social Change, 60, 37-54 (1999).

  2  C Freeman, Technology and Economic Performance: Lessons from Japan, Pinter, London, 1987.

  3  B A Lundvall (ed), National Innovation Systems: Towards a Theory of Innovation and Interactive Learning, Pinter, London 1992; R Nelson (ed), National Innovation Systems: A Comparative Analysis, Oxford University Press, Oxford, 1993. Other empirical studies include K Smith et al: The Norwegian National Innovation System: A Pilot Study of Knowledge Creation, Distribution and Use, STEP Group, Oslo, Norway; and S Numminen, National Innovation Systems: Pilot Case Study of the Knowledge Distribution Power of Finland, VTT Group for Technology Studies, Helsinki, Finland.

  4  OECD Science, Technology, Industry, National Innovation Systems, Organisation for Economic Co-operation and Development, Paris, 1997.

  5  M Gibbons, C Limoges, H Nowotny, S Schwartzman, P Scott, and M Trow: The New Production of Knowledge, Sage, London, 1994.

  6  OECD, op cit note 4, p 11.

  7  J Irvine, and B R Martin: Foresight in Science: Picking the Winners, Pinter Publishers, London, 1984; and Kodama F: Technology Fusion and the New R & D, Harvard Business Review (July-August), 70-78 (1992).

  8  OECD, op cit note 4, p 7.

  9  Ibid, pp 41-42.

  10  Office of Science and Technology: Progress Through Partnership, HMSO, London, 1995; Office of Science and Technology, Winning Through Foresight, Office of Science and Technology, Department of Trade and Industry, London, 1997; Sir W Stewart: Technology Foresight in a UK Context, pp 48-57 in J Anderson, R Fears and B Taylor (eds), Managing Technology for Competitive Advantage, Cartermill International, London, 1997.

  11  See Irvine and Martin, op cit note 7, p 144; and B R Martin and J Irvine: Research Foresight: Priority-Setting in Science, Pinter Publishers, London and New York, 1989.

  12  J A Mathews, High Technology Industrialisation in East Asia, Journal of Industry Studies 3, 1-77 (1996) see p 64.

  13  P David and D Foray, Assessing and Expanding the Science and Technology Knowledge Base, Science, Technology, Industry Review 16, 13-68 (1995). See also P den Hartog et al: Assessing the Distributional Power of National Innovation Systems: Pilot Study of the Netherlands, TNO Centre for Technology and Policy Studies, Apeldoorn, 1995; and S Numminen, National Innovation Systems: Pilot Case Study of the Knowledge Distribution Power of Finland,VTT Group for Technology Studies, Helsinki, Finland.