26 February 2014

Africa's Firms Revealed As Innovative but Unsupported

Firms in low-income countries (LIC) have vibrant cultures of innovation, but policymakers' failure to recognise this fact is undermining the private sector's development impact, a research project is starting to reveal.

Preliminary results from a case study in Ghana, described by its author as a "breakthrough" and presented during the inaugural African Innovation Summit in Cape Verde this month (4-6 February), challenge the common assumption that innovation is a Northern phenomenon.

"There are a lots of creative activities taking place, but people think innovation is not relevant for LICs," says the lead author of the study, Xiaolan Fu, a professor of technology and international development at the University of Oxford, United Kingdom.

"That is why people have not paid enough attention to it and this is one reason why Africa is lagging behind," she tells SciDev.Net.

Previous, rare attempts to study innovation in LICs have used questionnaires originally designed to measure this trait in developed nations, says Fu.

Instead, she says that she combined case studies, company and trade data, and a survey of more than 500 firms to provide a deeper view of Ghana's complex innovation landscape.

The study's design could act as a template for further research, paving the way for better understanding of innovation in other LICs, she adds.

The research revealed innovative products and production practices as well as novel marketing and management strategies, but most of this activity was incremental and based on the diffusion of ideas across Ghana. Little knowledge comes from outside the country and the limited collaboration between businesses was also stifling creativity, it found.

Governments must therefore implement policies that build national and international business networks, create incentives for innovators and provide funding to overcome common financial restraints, says Fu.

Her team has already met with officials from the United Kingdom's Department for International Development - which helped fund the research - and UN agencies to discuss how the findings could feed into policy.

Fu believes the project's focus on certain industries common across Africa, such as textiles, construction, and processing of resources such as minerals, might allow conclusions to be applied to different countries.

Mammo Muchie, a board member of Globelics, an international academic network for innovation, and an advisor on the project, says the research demonstrates how to study innovation across LICs.

"It shows there is a way we can do serious research in a complex environment where you have a mix of formal and informal sectors," he says.

But Teresa Soop, a research advisor for the Swedish International Development Cooperation Agency, says the "very low" levels of researchers from developing countries investigating innovation need to be increased if the field is going to make real progress.

More opportunities for innovation studies academics to meet and collaborate, such as the annual Globelics conference - the next instalment of which is scheduled for October in Ethiopia - need to be created, she adds.

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