Innovation is a driver of economic success and growth. That’s why everyone talks about innovation. Companies and countries that consistently invest in innovation by prioritizing research and development and allocating funds and resources for this activity are proven to be more successful than those that don’t.
A new report, 2016 State of Innovation, says there is a convergence of collaboration, innovation, cultivation, cross-pollination and calibration, between corporations, universities, government agencies. research centers, and startups to drive new levels of innovation. Physical and mental boundaries are being lifted. Like-minded, similar-goaled organizations are finding each other. A web of information is aligning partners and best practices in an effort to collaboratively innovate.
This is creating a powerful process of bringing inventions to life with strategic partners and suppliers. Coming up with a novel idea can be a feat in itself, but actually bringing one to market is an entirely different game. The lifecycle of innovation, from discovery and protection to commercialization and launch, involves everything from research and prototyping to intellectual-property protection and product monetization.
The report says many breakthroughs happened over the last year. It was the first time astronauts from different countries embarked on the longest human space mission by two men: American Scott Kelly and Russian Mikhail Kornienko, occupying the International Space Station for nearly a year. It was the first time self-driving cars were tested on public roadways in certain jurisdictions around the world. And, the first time a biosimilar drug was approved in the US, while certain other drugs were being tested on 3D printers. It was also the year when the Internet of Things (IoT) garnered mass appeal, allowing homeowners to manage their dwellings with omnipotent-like intelligence, while cloud storage became mainstream.
It adds that these firsts were possible because of the massive investment in innovation made by organizations around the world. Overall, global innovation activity saw a notable uptick over the last year, with medical devices, home appliances and aerospace leading the charge. These sectors all experienced year-over-year, double-digit growth, as did information technology and oil & gas. In fact, every sector was in the black except one: biotechnology.
The sectors covered in the State of Innovation 2016 report are:
- Aerospace & defense
- Automotive
- Biotechnology
- Cosmetics & wellbeing
- Food, beverage & tobacco
- Home appliances
- Information technology
- Medical devices
- Oil & gas
- Pharmaceuticals
- Semiconductors
- Telecommunications
We present extracts of the summaries of each sector below. To view the full detailed report, see the link at the end of this article.
Aerospace & defense
The aerospace & defense sector saw a significant jump of 15 percent over prior year activity, with the largest jumps occurring in space vehicles & satellite technologies (23 percent), followed by production techniques (19 percent) and propulsion plants (15 percent). There’s no denying the race is on to find a sustainable way for humans to inhabit space, as part of global strategies to handle the exploding human population and ill effects of climate change on earth.
The top 10 innovators in this sector are from the United States, China, France, South Korea, Germany and Japan. And, they include a mix of expected and unexpected companies, including United Technologies Corp., Airbus and Boeing as well as General Electric, LG Electronics and Toyota, respectively.
Automotive
Automotive innovation accelerated by 8 percent from year-end 2014 to year-end 2015. All but two of the 12 subsectors jumped up, with the largest gains in seats, seatbelts & airbags (34 percent) followed by suspension systems (17 percent) and alternative powered vehicles (15 percent), respectively.
Asia continues to dominate the field overall with 60 percent of the top 10 headquartered there. Japan’s Toyota takes the top spot again, followed by the same top-five-priority-order of last year: Hyundai (South Korea), Bosch (Germany), Denso (Japan) and Honda (Japan). In terms of alternative-powered vehicle innovation, Japan’s Toyota is in a category almost unto itself with nearly 10,000 unique inventions in that area alone last year. The next closest competitor in that space is Germany’s Bosch, with just over 3,000 unique inventions.
Biotech
Biotech was the only technology area of the 12 studied that decreased its year-over-year innovation output, experiencing a 2 percent decline over 2014. This is after having had a 7 percent overall increase from 2013. And all but one of the subsectors, general biotechnology, declined from the earlier period, with the steepest drops in the diagnosis of diseases (20 percent) and drug discovery (13 percent).
The US dominates biotech scientific-and-scholarly research output with 80 percent of the top 10. The remaining two institutions are from Europe, one of which is headquartered in the UK and the other is in Germany. Once again the Broad Institute takes the lead spot with the most impactful research, whereas MIT was bumped from second to third place by the European Molecular Biology Lab.
Cosmetics & wellbeing
Despite plastic surgeons being busier than ever (skin-related innovation is up 12 percent), the bulk of the cosmetic subsectors dipped over the prior year. Fragrances experienced the largest drop, of 15 percent. The world’s most active cosmetics & wellbeing innovator is, surprisingly, South Korea’s LG Household & Healthcare. This is the first time since the inception of the annual State of Innovation that a traditional cosmetics company has been trumped by a technology-based company.
Brazil once again takes the top spot in terms of cosmetics-related scientific research, with the University of Sao Paulo and State University of Campinas taking the first and eighth spots in terms of research output, respectively. This perhaps isn’t a huge surprise as Brazil is also among the top five nations in the world in terms of the overall number of aesthetic plastic surgeries performed annually.
Food, beverage & tobacco
While food-related innovation can be found in the biotechnology sector where GMO crops and engineered-organism inventions are categorized, this section covers inventions specific to the manufacturing and composition of items outside of what is genetically modified. The sector remained predominantly flat over the last year, growing by just 1 percent or about 300 inventions more than the prior period. The largest growth was in the area of brewing, which bubbled over 18 percent to 7,662 unique innovations last year, followed by bakery, which puffed up 6 percent. Meat, tobacco and sugar & starch all experienced declines.
The top 10 most active innovators in this category are all from China except one: Philip Morris in the US. This makes logical sense since China has the world’s largest population, which it will need to find a way to sustain in the coming decades as earth’s population nears 10 billion people, and smoking is still an accepted habit in this culture.
Home appliances
The home appliances industry experienced 21 percent year-over-year growth, with all subsectors seeing double-digit jumps. The most active subsector is kitchens, however the largest increase occurred in human hygiene, which was up 29 percent over the prior period. Human hygiene items include things such as a body scrub brush with a built-in soap dispenser, hair-styling devices and nail clippers, to name a few.
Asia is the undisputed leader in home appliance innovation. All but one of the top 10 innovators reside there, the lone wolf being BSH Hausgeräte, based in Germany. China takes the top three spots with Midea Group, Zhuhai Gree Electric Appliances and Haier Group, respectively.
Information technology
The companies leading the top 10 in the global IT pack are predominantly from Asia: China, Japan and South Korea, with just two outsiders: IBM (US) and Google (US). The world’s leading three innovators are State Grid Corp of China (China), Canon (Japan) and Samsung (South Korea). Each of these leaders’ activity is significant, with thousands of unique inventions annually.
Computing is by far the most active subsector, comprising 82 percent of IT’s overall activity. This includes inventions to see through walls (Vayyar), etch 3-D printed logos into almost any surface (Glowforge), charge smartphones at stations (NRG-Go) and uniquely light objects to photograph them in high detail. In the smart media subsector, Samsung is the clear frontrunner with more than twice as many unique inventions as its nearest competitor: Toshiba. Giesecke & Devrient leads in Europe and Sandisk in the US, but with much less overall activity than their Asian counterparts.
Medical devices
Japan is home to 40 percent of the world’s top 10 medical device companies, including the world leader Olympus. China and South Korea also have their hands in this sector, with the Fourth Military Medical University and Samsung Electronics, respectively. Europe and the US also make contributions to the global top 10, with two and three innovators each, respectively.
In the diagnosis surgery subsector, Japan has 90 percent of the top 10 innovators in Asia, demonstrating the nation’s proclivity in this field. South Korea’s Samsung is the only non-Japanese company in that top 10. Germany is the clear leader in Europe, with 60 percent of the top 10 companies, and the US takes all of the top spots for North America, with Covidien at the top followed by General Electric and Boston Scientific.
Oil & gas
The sector’s innovation pace ignited beyond the prior period, jumping up 14 percent overall, with refining and transportation & storage seeing the largest subsector jumps of 32 and 31 percent, respectively. China leads the world’s innovation activity taking the top two spots globally. Sinopec and Petrochina rank first and second, respectively. China National Offshore Oil is fifth. The US is the next most active region with Halliburton, Schlumberger, Baker Hughes and PRAD Research & Development making the top 10 list.
In the exploration, drilling & production subsector, China again dominates, with 80 percent of the top 10 for Asia, including the same three innovators as above securing the first three positions. Japan rounds out the remaining two in the top 10 with, interestingly, Toyota as part of the mix. The Imperial College of London is the most influential scholarly research institution in the Oil & Gas sector, followed by the US Department of Energy and Stanford University.
Pharmaceuticals
Pharmaceuticals experienced 4 percent year-over-year growth, with the most significant increase occurring in inorganics, which jumped up by 190 percent, from 1,373 to 3,975 unique inventions for the period. Inorganics include all non-carbon-based chemical compounds, featuring an array of metallic compounds as well as those that are synthesized in a chemical plant or lab.
Globally, China is the world’s leading region for pharmaceutical innovation with 50 percent of the top 10 pharmaceutical companies residing there: University of Jiangnan, University of Zhejiang, Foshan Saiweisi Pharma Technology, University of Shanghai Jiaotong and University of Guangxi. The most influential top 10 scientific research organizations in pharmaceuticals have balanced representation across China, Europe and North America, with China’s Tianjin University taking the top spot.
Semiconductors
Semiconductors saw a 3 percent year-over-year increase in activity, with memories, films & hybrid circuits jumping 16 percent, the most of any subsector. The largest segment: semiconductor materials and processes, however, declined by 3 percent over the period.
Asia continues to lead in the overall Semiconductor landscape, with Samsung Electronics taking the top position and logging over 4,000 unique inventions in just one year. LG and SK Hynix (both from South Korea) also rank in the top 10 overall. China, Japan and Taiwan all also place in the world’s top 10, with China taking four of the 10 slots, compared to just one each by Japan and Taiwan. IBM, which previously held the number one position in this sector globally, is now eighth. Samsung has 328 percent more inventions annually than IBM. Europe does not even place in the top 10.
Telecommunications
Telecommunications was up 3 percent year-over-year, despite three-quarters of its subsectors declining slightly in activity from the last period. The subsector telemetry & telecontrol, which covers measuring, transmitting and receiving apparatus, experienced a whopping 38 percent jump from 18,437 unique inventions at year-end 2014 to 25,417 unique inventions at the close of 2015. All the other subsectors declined between 2–7 percent except for data transmission networks, which was up 3 percent.
Like in the semiconductor sector, Asian companies lead the top 10 list in telecommunications innovation with 80 percent of the representation. Samsung (South Korea) takes the most innovative spot, followed by Huawei (China) and LG (South Korea). In addition to the two companies from South Korea and three from China, there are three Japanese organizations and one each from Sweden and the US in the leading 10.
We have only presented extracts of each of the 12 sectors in the report. For full details of subsectors, top innovator lists and top scientific research institutions in each sector, visit the 2016 State of Innovation report.
