Co-Evolution of Innovation Policy and Industrial Structure in Sweden - Term Paper Example

Co-evolution of innovation policy and industrial structure in Sweden TABLE OF CONTENTS 1. Abstract of the paper…………………………………………………………………..3 2 .Introduction……………………………………………………………………………4 3. Present economic situation of Sweden………………………………………………..5 4. Research and Innovation in Sweden…………………………………………………..5 5. Institutional Innovation and Sweden………………………………………………….7 5.1 Sweden: The functional food ‘cluster’ of Scania and its success story…………....7 5.2 Factors determining high growth in the food industry…………………………….7 6. Co evolution of innovation policies and the Swedish food industry –Relevance with the three dimensional model……………………………………………………………….……8 7. A framework for analyzing innovation in food sector ………………………………9 7.1 SWOT analysis of Medicon Valley……………………………………………..10 8. Co evolution of Innovations in construction sector of Sweden .......................13 9. Role and impact of universities in the construction industries ……….………16 10. Inter-organizational interaction between the contractors and the material suppliers and innovation policies……………………………………………………………………..17 10.1 Weaknesses of construction industry……………………………………..….18 10.2 Recovery and present scenario of the construction industry.…………..……18 11. Co evolution of Innovations in service sector of Sweden……………………….…18 12.1 A present scenario of the services sector in Sweden ......................................19 12. Innovations at Research Institutes …………………………………………………20 13. Innovation within transport sector: R&D priority areas……………………………21 13.1 Environment …………………………………………………………………22 13.2 Safety and Security ………………………………………………………….23 13.3 Infrastructure …………………………………………………………………23 13.4 Intelligent Transport System …………………………………………………23 14. Other Sectors and growth potential…………………………………………..….….24 15. Conclusion………………………………………………………..……..…………..25 Abstract: Primordially the focus is on the co-evolution of innovation policy and industrial structure in Sweden and their explicit microanalysis starting with the theoretical analysis of underlying concepts of institutional innovation, the co-evolution between innovation and institutional systems and their success mechanics. The paper then focuses on the prime variables determining these above process and how far and to what extent Sweden’s industrial structure has been successful in adopting these processes has been elucidated in a detailed fashion. Introduction The product of varied dynamic interactions amongst social agents in the society leads to the emergence and evolution of several types of institutions which may be economic, political or cultural. As interaction in the society gives rise to the development of institutions, manifold arbitrary behaviors ushers in those institutions which comes in practice and thus become stereotyped norms of those institutions followed through time. So institutions become dire indicators of several outcomes of the many domain of the society. It is a general notion that the key indicators that promote economic development are the levels of investment, education, culture, governmental policies, income etc. But if rather viewing in a more magnified way, the social scientists of the modern world have claimed that it is the primary role of social institutions where by the lieu of interaction between independent agents play a dominant role in accumulating valuable resources and fetching profits for the society. This notion of institution acting as the primordial driving force of economic development is resonated in different arrangements of the society like property rights, microfinance, business associations, advices of developmental agencies in proposing minimal state intervention implying pro market paradigm etc. Institutional variations are a huge domain of study and focus in the modern industrialized world as it has been the real fact that the so called differences between developed and developing nations have emerged. Many countries have emerged as super powers and many countries are still stuck in vicious circle of poverty and the main reason for this can be attributed to the diverse institutional innovation policies adopted and successfully implemented in the former case and lack of implementation of institutional innovation policies in the latter case. However there are many instances of developing countries coming from the periphery and emerging as a nucleus of growth potential. Examples can be cited that unlike most of Africa Botswana’s property rights and public agencies helped the country achieve some of the highest growth rates in the world. In Southeast Asia, Indonesia became a self sufficient producer in rice through its successful macroeconomic policies and agricultural logistics. Latin American country Chile has also been very successful in institutional innovation through its technology transfer mechanism (Doner, 2010, pp. 9-10). Present economic situation of Sweden Sweden, officially the Kingdom of Sweden is a Nordic country on the Scandinavian Peninsula in Northern Europe with a low population density of approximately 21 inhabitants per square kilometer with high income distribution, one of the world’s lowest poverty levels, ranks high in the Human Development Index, hovering life expectancy, well maintained standard of living, cheap medical facilities, good educational levels( free except nursery and high education although partly funded by the government), hi-tech infrastructure and well distributed social equality and welfare (Swedish Society, n.d.). Research & Innovation in Sweden Sweden is one of those countries that make huge investments in combined research, development and innovation. Sweden has the potential for a sustainable growth in the R&D in the long run. The major portion of the investments is done by private sectors. It must also be mentioned here that the bulk of R&D activities is controlled by some multinational corporations. However, since 2001 there has been a decline in the R&D investment as a percentage of GNP. This decline can be seen in both public funding and in some major industrial sectors. In Sweden, public investment in R&D is less than other countries. Sweden also does not have tax incentives for R&D activities to encourage investments. The nature of R&D financing has altered and many research institutions and universities are depending more and more on national and also international investments. More focus is given on the competitive aspect of R&D. This scenario means that the institutions have to maintain a clear strategy based profile to attract larger investments. The institute sector is small in Sweden compared to other countries. But, industries that are associated with specific industries are restructuring themselves. This may improve the level of international competitiveness in the institute sector. Currently, Sweden holds a strong position in the international arena in the field of R&D. This is because there has been an increasing number of qualified researchers, who are still young and have a long way to go. Compared to other countries, larger numbers of business in Sweden are involved in innovation activities and much of the innovations are done through collaboration. In spite of this, statistics reveal that communication between R&D in business world and in the academic world is not extensive like other countries. In Swedish universities, investments on corporate research is low and this show be rectified because most R&D companies are situated near the universities. The quality of research in Sweden is high because of high level of competency among the researchers, especially in biomedicine and clinical medicine. Sweden holds a stable competitive position in technology. Sweden is counted among the top ten nations in regard to the number of international patents it holds. The patents are owned by corporations which focus on R&D. Globally, patent applications are increasing in the IT and telecoms. Sweden is going through a declining phase in this field which signifies decline in competition. (The Royal Swedish Academy of Engineering Services, 2008. p.5) Institutional Innovation and Sweden Swedish economy has faced hard times from global financial crisis although it has encountered boom periods during the past decade with high economic growth above the European average, lower inflationary rates and exaggerated employment scenario and the credit is attributed to the institutional innovation policies in Sweden. The focus will be on some selected industrial sectors of this Nordic country and the co evolution of innovation policies in those sectors along with success stories and loophole analysis (Asheim, and Coenen, 2004). Sweden: The functional food ‘cluster’ of Scania and its success story Food processing industry in Sweden is a huge market and the case for Sweden. Food processing and life science industry is a highly prospective and competitive sector. Innovation dynamics crippled into this sector and several fragmented dedicated institutions and research and development industries developed (Asheim, and Coenen, 2004, pp.10-11). These companies are responsible for the production and marketing of functional foods as well as providing with grass root regional scientific research. Scania is one of the fastest growing food industries in the world and it is the center for Sweden’s food industry. Presently the food cluster that consists of food-processing industry, packaging, production machinery, distribution, warehousing and quality control is a major part of the European market and authorizes its supremacy over the Scandinavian food market (Lagnevi, n.d, pp. 209-210). Factors determining high growth in this industry There are numerous factors for the success story. Firstly Strong scientific and technology based innovation policies development of improved new products. Secondly, highly educated people in the field of science and technology are involved. Thirdly, there is severe involvement of stakeholders of all types. Fourthly it can be said that there has been throughout support of the government with necessary funding in the field of research. Lastly it can be concluded that wide access to private investment capital with spontaneous informal network and focus on the competitive environment is responsible for this sector (Lagnevik, n.d, pp.95-96). Co evolution of innovation policies and the Swedish food industry –Relevance with the three dimensional model Previously the Swedish food market was protected from international competition. The first step which the Swedish government took was in 1986 when it adopted the policy of departure from a consumer-benefit approach and promoted the gradual exposure of this industry to international competition. The second major step of the Swedish government was the collaboration of Sweden with the European community on 1 January, 1995 which resulted in easy entry for the finished food products. Thirdly a major phenomenon occurred on 1 May 2004 with the joining of new member states with European Community which completely exposed the Swedish food industry to cut throat international competition. Two important technological revolutions have been encountered by the Swedish food industry that is the IT and Biotech revolutions which radically changed the environment of working for the food companies (Lagnevik, n.d, pp.10, 11). A framework for analyzing innovation in food sector (Traill and Grunut, 1997, p.3) It has been observed that mobility of highly qualified professionals from large companies to new innovative firms is increasing. They joined the research and development sectors and brought about new innovative ideas and formulated them which came to the forefront and led to this huge development in the industry. At the regional and national level the firms cooperate with other firms and other research organization bodies with close proximity to Lund university which is well equipped with world class research and educational facilities in the field of functional food and this university stands to be the base pillar of commercial outperformance of functional food in Scania and as one of the further development of true functional food cluster. Prestigious research concerning food is conducted at the Lund University especially at the Lund Institute of Technology of Technology (LTH), at the School of Economics and Management and the Swedish University of Agricultural Science, Alnarp (SLU). Every kinds of scientific knowledge in the food chain from plough to plate as well as scientific knowledge in industries related to and supporting the food chain is executed in the research domain in the region and which led to the development of a number of organizations to provide the platform for exchange of research and development between the food industry and industry (Lagnevik, n.d, p.211). Role of information technology has been also an important driver to this fine-tuned condition of the Swedish food industry. Information technology uses data and participates in the transfer of these useful data with lower cost and with greater speed and accuracy. For the food industry the information technology has significantly devised in the delivery of logistics, handling of goods, delivery of goods, business to business transactions, economic planning systems in a much accelerated pace. Apart from that biological sciences and biotechnology has played significant role in the food industry of Sweden. The main governmental body in Sweden is VINNOVA (Swedish Agency for Innovation Systems) established in 2001 has an annual budget of EUR 110 million to sustain innovation at a national, regional and sectoral level with the partnership with industry and academics (Lagnevik, n.d., p.216). The technology adopted by the food industry which revolutionized the same in Sweden is the “Triple Helix” system. The crux of Triple Helix is the mutual co-operation and interaction between companies, researchers and the government. Along with that corporate exposure also has been immense from food ingredient companies and packaging companies. The main objective of the Triple Helix model is innovation and (Lagnevik, n.d, p.216) through the cooperation of this project highly operative development between university, industry and regional government has been encountered. One example in this case is worthy to mention. Medicon Valley Academy/Alliance is currently recognized among the Europe’s’ top 3-4 largest biotech regions and also one of the world’s largest bioregions (OECD, 28-Oct-2010). The important element of initiative behind the establishment and development of Medicon Valley is the efficient and well functioning public-private partnerships with respect to research collaboration between university and both, Big Pharma and small DBFs, venture capital raising, and general support for cluster formation (OECD, 2009). With this view in mind the SWOT analysis regarding the Medicon Valley project can be mentioned here. SWOT analysis of Medicon Valley (OECD, 2009, p.151). Strengths Weaknesses Opportunities Threats Local Presence of Big Pharma Cluster fragmentation along national borders Inter sector collaboration Dependence on big pharma Large number of small and medium sized DBF Imbalance Increased cross border integration Strong academic research Weak commercialization of academic research Quality of life Extensive breadth in value chain components World leading in four therauptic strongholds Presence of network organization in Medicon Valley Alliance Embedded in global knowledge networks Secondly the “VINNVAXT” initiative adopted in Scania functional food sector, international marketing of food and a policy initiative of building regional innovation system backed by ten year support to promote global competitive industries. Thirdly, it can be said that a phenomenal development of internet and wireless communication access project named “Mobile Heights” around Scania and the neighboring country of Blekinge was thereby developed (OECD, n.d.; OECD, 2009, p. 83). Thus the food industry in Sweden has developed immensely with the co-evolution of innovation and the above stated brief analysis can be said to have complete parity with the second base structure of three dimensional model that is the Entrepreneurial organization and culture. Co evolution of Innovations in construction sector of Sweden The construction industry in Sweden took a diversified change after the policy of deregulation in the mid 1990s prior to which the construction industry was subjected to strict building standards with engagement of a large number of economic and legal experts but post deregulation the scenario totally changed and emphasis was given on every pros and cons with the focus on the building as a whole including overall efficiency, indoor climate and security of the building. As a result of this transformation employment scenario changed and urge for highly qualified personnel were required for the Swedish contractors which as a consequent gave rise to the importance of universities and relations with them became inevitable (Hakansson, 2007, p. 55). Role and impact of universities in the construction industries Two giant contractors of Sweden were Skanska and NCC who emerged as the pioneers in the construction sector of Sweden. In order to recruit technical personnel with sound technical know how the managers thought it the best to recruit the people from the universities and regarded the universities to be the specialist source of knowledge. It has been found that several highly qualified doctorate students are employed by giant corporate construction companies and they carry on in house projects within the university to develop new innovative technologies which can be adopted and utilised in optimal fashion in the construction sector. An example can be cited where it was found that a dozen post graduate students were recruited by NCC Company and they were engaged in the laboratories of universities developing ideas and technology only on “basic” construction techniques. Again for instance in 1999 NCC along with the help of government funding 29 PhD. students were recruited in a project on ‘Constructive building’, roads, dams, tunnels and sustainable buildings . They were also given strong financial support from contractors and they believed that funding in the knowledge sector like research institutes, universities was worthwhile as continuous research and development on an existing thing may result in the development of new technologies which will turn out to be evolutionary in construction mechanics. ENCORD (European Network of Construction Companies and Development) includes Swedish contractor Skanska, German contractors Holzman and Hochtief and recently French contractor Boygues and it has formulated three basic priorities; firstly it emphasizes on the Research and development scenario including recycling of construction materials, development of new and innovative techniques, shaping the fundamental areas of construction domain etc. Secondly, in order to increase the competitiveness of the partner firms, a drive has been created in the strong connection in the EU commission for information exchange, develop specialist knowledge and create a structural base of knowledge domain. Again a giant European contractor SEC whose counterparts are Swedish contractor NCC, German contractor and UK contractor Liang all emphasized on the knowledge based expertise domain in the construction industry and dedicated huge resources in the development of technical management expertise and experience in alternative procurement and project financing contracts (Miozzo and Dewik, 2004). Inter-organizational interaction between the contractors and the material suppliers and innovation policies Contractors in Sweden have a tendency to maintain a long term relationship with the material suppliers. Large contractors own concrete and prefabricated concrete suppliers, asphalt plants, gravel suppliers and window manufacturers. Contracting company NCC has its own business area supplying crushed products, asphalt products, ready mixture concrete and engineering services and they invest in these sectors and emphasize on knowledge base in these sectors. Sometimes due to high price competition the work may not be in all cases done by integrated suppliers and sometimes the work is subcontracted in a more informal sector with lower cost and on tender basis. This has produced conflicts in many cases but also has reaped benefits in various cases like JM, the fourth largest contractor in Sweden which has a three year contract with Kune, a Finnish supplier of elevators supplying at a fixed rate which entails in the financial certainty of both parties. NCC also has a few year contracts with a well known supplier in order to maintain a fixed and certain revenue generation. Thus a trend of long term organizational interrelationship between the contractors and suppliers and big contracting companies and universities and educational institutions can be regarded as the synthesis for the success and innovation mechanism and thus keeping in parity with the three dimensional mechanics of institutions. (Miozzo and Dewik, 2004, p. 55) Weaknesses of construction industry Successful innovation development in the construction industry can be attributed to the strong long term relationship between the contractors and suppliers but if seen in the other way round it can also be said that architects have lost their power in the sector of supply and this has created a negative externality in the field of architects (Miozzo and Dewik, 2004, p. 55) The Swedish construction sector has also a small home market and fierce competition has been generated with foreign companies plunging into cut throat competition market , and minimal margins (Market Monitor, 2011, p. 20). Recovery and present scenario of the construction industry The Swedish construction sector has been encountered to recover from its slump of 2009, with regaining of activities accelerating up again and by the first half of 2011 and new residential construction have increased by 8% . As compared to 2009, profit margins have bounced up and increased turnover volumes and turnovers have increased significantly and solvency has been achieved (Market Monitor, 2011, p. 20). Co evolution of Innovations in service sector of Sweden European countries have shifted its very focus towards the services sector inculcated with several successful innovative policies. In Sweden, innovation in services has received significant policy documents. In Sweden several reports have revealed the significant role of regional actors in the service innovation policies as for example in the business service development regional policy activities are dominant activities whereas in the public sector services the public sector plays a dominant role in innovation policies. In the regional level the activities are mainly cluster type activities which are relevant to certain specified classes of services such as tourism, financial services, digital market. Some regional actors have cluster policies confined to certain specific industries such as software, medical and healthcare industry, digital content etc (Spath and Ganz, p. 78). A present scenario of the service sector in Sweden Although the issue of service sector has been stressed manifold times but in reality it imparted limited impact on Sweden’s economy but presently most policy makers and other stakeholders in the public argue that services in Sweden have increased fairly in the degree of importance. The three major service sectors in Sweden are education, healthcare and social services which are more or less regulated and performed within the sphere of public sector and resulted in much of the public discussion and several concerns have crippled up regarding the way of improving the effectiveness of public services. Some noteworthy developments in the service sector in Sweden which have developed recently can be mentioned here which bears some significance. Firstly, coordination of the ICT activities within the public sector have been adopted to fetch progress. Secondly, a service foresight has been launched by VINNOVA together with Almega (an organisation with a service sector focus a member of the Confederation of Swedish enterprises). Thirdly, VINNOVA and the Hotel & Restaurant Workers Union together with the Swedish Hotel and Restaurant Association have published a document with integrated R&D areas within the tourism sector. In early 2007, NUTEK (the Agency for Business Development) a strategic paper was published for the development of the tourism industry. As climate change has been a current issue on the policy agenda, urge for clean technology services inquiries have been launched to present a picture of the Swedish landscape for. To enhance the public sector administration and to find innovative policies for the same a move to cut business administrative bureaucracy by 25% has been adopted. VINNOVA has started a program which does sector based research, development and demonstration. This program is called ‘Service Innovation 2007’. This program provides a new concept of service innovation and deal with ‘service logic’ which means that value created in a service firm is equivalent to the value perceived by the customer. The purpose of the program is to create service by newer scientific methods and to extract better value from the services. This program had public financing of SEK40 million. (Cunningham, n.d., p.23,34) Innovations at Research Institutes In Sweden R&D activity at research institutes is controlled by the private sectors. In Sweden, the government has given priority to universities as resource for primary research. This has affected the size of the institute sector. Research activities in institutes focus on various aspects of technologies. There are about 30 research institutes in Sweden out of which 16 are under IRECO. It is the administration body of research institutes and used to be under the Ministry of Enterprise, Energy and Communications. IRECO institutes receive investments from both private and public sectors. The government invests in R&D so that quality is maintained in the research activities so that competition remains strong. Public funding is also needed for long-term research projects which carry a certain amount of risk. The main objective of R&D is to provide technological innovations in the Swedish industry. The results of such research can produce new commercial products and processes. The research institutes provide partners for research and suppliers of technology to others who are involved in research activities for enterprises. Different kinds of services are provided by the industry research in Sweden. There are ‘joint research projects” which invites any person who is interested in the research subject. These projects are jointly funded by private and public sectors. There are ‘multi-customer projects’ which provide research opportunities to national and international companies. These projects split the costs and are also jointly funded by private and public sectors. There are also projects that are funded solely by individual companies. Industry research institutes sometimes offer information and services without charging any price and at other times provide information and services which are paid by individual companies. In the year 2001/02, the Swedish government proposed a restructuring process with the objective of “creating a flexible and effective structure with fewer but stronger institutes that are internationally competitive and have a strong industrial base”. In response to such restructuring process, the industry research institutes focused on several sectors like “fibre, paper, packaging and printing technology, material science and engineering mechanics, information and communication technology and biotech, environmental science and structural engineering” (The Royal Swedish Academy of Engineering Services, 2008. pp.14-15) Innovation within transport sector: R&D priority areas Sweden is characterized by long distance and severe winters. During the 20th century Sweden was transformed from a backward nation to one of the most developed industrial nation. The transport industry played a major role in this development process. Sweden’s sophisticated infrastructure is seen in all transport systems. Sweden is one of the leading countries that invest in R&D and the nation focuses on achieving the world’s first ‘oil-free economy’. Although there is improvement in the energy efficiency of vehicles, overall fuel consumption has not reduced. This is because the size and power of vehicles are increasing along with the volume of transport. The Swedish government’s primary goal regarding transport is to “secure a socially, economically efficient and long-term sustainable transport system for citizens and industry in the country as a whole”. (VINNOVA Information VI, 2006, pp.3-4) Environment The environment aspect is an important part of Sweden’s transport sector. The emphasis must be on maintaining its position. However, it is seen that emission levels on local basis are decided in international forums, while the problems relating to global climate are based on ‘voluntary agreements and national initiatives’. (VINNOVA Information VI, 2006, p.5) The research institutes of Sweden offer absolute competence to the customers who are conscious about the environment. For the last 30 years, Sweden has been one of the leading country in the development of an alternative source of energy. This has been possible because of high demand of environmental friendly vehicles among the nation’s population. There are also insufficient sources of fossil fuels within the country. Various companies like Volvo Trucks, Scania, Saab automobiles work together in close association with small companies that engage in innovation activities to develop extensive ‘green technology programs’ in order to advance the technology. Swedish governments make investments on research programs that focus on ‘fuel efficient cars and renewable fuel’. Foreign research companies that are established in Sweden can also get financial help. There is a ‘Swedish Electric Mobility Initiative’ projects that has the target to achieve 600,000 electric vehicles by 2020. This project has already reached an advanced stage. (Invest Sweden, 2011, p.3) Safety & Security Another important area of research is traffic safety. In the late 1990s the goal was set to reach ‘Zero Vision’ which means in the long run there will be zero cases of people dying or getting injured because of traffic accidents. The Swedish government proposed new research organisations with the primary target of ensuring maximum traffic safety. (VINNOVA Information VI, 2006, p.6) Infrastructure This area of research includes maintenance of not only roads, tunnels and railways, but also energy, telecommunications and computer techniques. Currently the technical aspects related to construction of roads have deteriorated in Sweden. On the other hand digital technology is increasingly becoming important for efficient use of infrastructure. (VINNOVA Information VI, 2006, p.6) Intelligent Transport system (ITS) The aim is to maximise the efficiency of transport infrastructure with minimum use of the country’s resources. For this purpose a complete transport solution is required. Another issue is to reduce the road transport by creating more water and rail transport. Further, it is required to reduce the load on airfreight by introducing more fast running trains. There should be optimum use of infrastructure to increase movement of vehicles, safety of traffic and productivity. Different kinds of traffic control have always been used within air and rail transports. (VINNOVA Information VI, 2006, pp.6-7) Sweden is among the leading countries in the implementation of ITS. It has the world’s most “extensive network of weather measurement stations which monitor road conditions and send out salting vehicles before the surface has the chance to freeze”. The world’s most widely used technology is in Stockholm that can automatically recognise number plates to reduce congestion. Sweden has the most advanced form of intelligent speed in vehicles. Volvo cars are leaders in the implementation “distance-keeping and lane-keeping systems in vehicles”. (Invest Sweden, 2011, p.6) Other Sectors and growth potential Sweden’s economy is believed to be dominated by traditional basic and engineering industries for a very long time in the future which creates most of the value growth of Sweden’s industry. Growth is a factor depending on the interaction between old and new systems and between different industries and technologies and from the above analysis it can be said that demand for products with high knowledge content, now steadily growing for services that are connected with traditional manufacturing goods in one way or another. Another important industry which grew up as a result of innovation is the retail market which has been predominantly influenced by the food processing industry which deals with aspects of retailing and consumer behaviour. The prime focus of this area is to measure the number of innovations in food retailing with the yardstick of comparison between innovations in private labels with innovations in manufacturers’ brands. By studying various parameters like price levels, product characteristics and consumer response it has been found that this project has already become a centre of attraction for the trade and retail industry and has led to several discussions in order to promote innovative projects in the food production and retailing arena (Lagnevik, 2010, p. 219). Conclusion Thorough analysis and propounded research has led to the conclusion that innovation is indeed an indispensable yardstick for evaluating and structuring of the co-evolution of innovation policy and institutional systems and Sweden one of the leading OECD countries has been brought into the limelight for developing this highly philosophical and crucial exposition embedded within the dynamics of the society and also in the evolution or transformation of the society into absolutely new faces which has contributed mankind with egalitarian and immense benefits through time immemorial. Firstly, the concept of innovation in social institutions and their parallel co-evolution has been thoroughly described with focus to several developing markets. Then the analytical approach of the three dimensional mechanism of the institutional system has been formulated which has been the base structure for analyzing further. Then within the purview of economic backdrop the short the focus is concentrated on the institutional innovation in the Swedish market. A part of the discussion has been scrutinized and focused on the food industry in Sweden along with analysis of pros and cons in that industry as for example the growth dynamics, role of technology, biological sciences in that sector, SWOT analysis of a highly potential sectors, potential of growth, geographical, cultural significance keeping relevance with the three dimensional structure of institutions. Then further focus have been concentrated on the leading industries and developing sectors of the country like the construction sector, services sector, research sector, transport sector and a short glimpse of other leading developing industries of Sweden and the germination of innovation within them in a quite synchronized pattern. References 1. Asheim, B. T., Coenen, L. ( 28th April, 2004), THE ROLE OF REGIONAL INNOVATION SYSTEMS IN A GLOBALISING ECONOMY: COMPARING KNOWLEDGE BASES AND INSTITUTIONAL FRAMEWORKS OF NORDIC CLUSTER, Department of Social and Economic Geography, available at: http://www.druid.dk/conferences/summer2004/papers/ds2004-166.pdf (accessed on March 15, 2012) 2. Cunningham, P. (n.d.) Innovation in Services: Thematic Report, Pro-Inno Europe 3. Doner, R.F. (2010), Explaining Institutional Innovation, Social Science Research Council, available at: http://www.ssrc.org/workspace/images/crm/new_publication_3/%7B4356d6c4-99db-df11-a822-001cc477ec84%7D.pdf (accessed on March 15, 2012) 4. Hakansson, H. (2007), Knowledge and Innovation in Business and Industry, Taylor & Francis 5. Invest Sweden, (January, 2011), Transportation systems 2011: Innovation the Swedish way, available at: http://www.investsweden.se/Global/Global/Downloads/Publications/Transport-systems-2011.pdf (accessed on March 27, 2012) 6. Lagnevik, M. (2003), The Dynamics of Innovation clusters, Edward Elgar Publishing 7. Lagnevik, M. (n.d.), FOOD INNOVATION AT INTERFACES, School of Economics & Management, Lund University, Sweden, available at: http://library.wur.nl/frontis/research_triangles/10_lagnevik.pdf (accessed on March 15, 2012) 8. Lagnevik, M. (2010) Food Innovation at Interfaces, The British Journal of Sociology Vol. 61 No. 2, available at: http://library.wur.nl/frontis/research_triangles/10_lagnevik.pdf (accessed on March 16, 2012) 9. Market Monitor (2011), Firm foundations on shaky ground?, available at: http://www.atradius.cn/en/images/stories/Market%20Monitor/MM_Sept2011.pdf (accessed on March 16, 2012) 10. Miozzo, M. and P. Dewik (2004), Innovation in Construction, Edward Elgar Publishing 11. OECD, (19-Aug-2009) Clusters, innovation and entrepreneurship, Local Economic and Employment Development (Program), OECD 12. OECD, (28-Oct-2010), Higher Education in Regional and City Development Higher Education in Regional and City Development: Rotterdam, The Netherlands 2010, OECD Publishing. 13. OECD, (n.d), Higher education in regional and city development: Rotterdam, Contribution of Higher education to innovation, OECD 14. Singh, J.C., Brodbeck, F.C. and R.J. House (2007), Culture and Leadership across the world, Routledge 15. Spath, D. and W. Ganz (2008), The Future of Services, Hanser Verlag 16. Swedish Society, (n.d), available at: http://www.sweden.se/eng/Home/Society/ (accessed on March 15, 2012) 17. The Royal Swedish Academy of Engineering Services, IVA, (2008), Research & Innovation in Sweden- An International Comparison, available at: http://www.skane.se/Public/Naringsliv/Dokument/Vinnova_rapport.pdf (accessed on March 27, 2012) 18. Traill, B.G. Grunert, K., (31-May-1997), Product and process innovation in the food industry, Springer 18. VINNOVA Information VI, (3-June-2006), Paving the road for transport innovation and research, available at: http://www.vinnova.se/upload/epistorepdf/vi-06-03.pdf (accessed on March 27, 2012) Read More