Exploring innovation management strategies in the Flemish bioeconomy: An organizational innovation system perspective

The current fossil-based economy faces a number of challenges, such as an increasing and aging population, depleting resources and materials and a changing climate. Many countries around the globe believe that the development of a more bio-based economy can be one of the solutions to cope with a number of these challenges. This bioeconomy, defined as a collection of activities that sustainably produce biomass and transform this biomass into a range of products including food, feed, paper, biofuels, bioplastics and biopharmaceuticals, could greatly reduce our dependency on fossil resources such as oil and allow for the production of goods and services at a lower environmental cost.

Although many scholars from a broad array of scientific disciplines have been working for over 15 years on the development of knowledge and technologies to facilitate the transition towards the bioeconomy, it is still in its infancy. Many techno-scientific questions remain unanswered, but even more socio-economic questions are still open. One of the key socio-economic questions that has been severely under-researched is how organizations should configure their innovation management strategies in the bioeconomy context. In essence, the transition towards a more bio-based economy requires radical innovations implemented by traditional and new firms. Despite an overwhelming agreement on the importance of knowledge creation, research and development, and innovation to realize this transition, few innovation management studies have been performed with the bioeconomy as its subject. The overall aim of the research presented in this manuscript is to develop insights in how organizations can configure their innovation management strategies to better realize the transition towards a more bio-based economy and to derive implications for researchers, supporting businesses, and governments on how to develop a stimulating environment.

We use state-of-the-art knowledge on innovation management to investigate the innovation management strategies and practices of organizations in relevant sectors. First, using an extensive literature review, we identified five key contextual factors that affect the innovation behaviour of the firms that want to innovate towards the bioeconomy: (i) the need for radically new and disruptive innovations; (ii) the complex knowledge base these innovations will be built on; (iii) the necessity of cooperation between different actors in order to exchange knowledge and create the required new supply chains; (iv) the expected issues with commercialization of a large amount of new bio-based concepts; and (v) the complex and fragmented policies and legislation that regulate the bioeconomy.

Second, taking these five aspects as a basis, we developed the BioID model, a model containing guidelines and recommendations for innovation management in the bioeconomy, using a structured review of the innovation management literature. In the BioID model, we postulate the use of transdisciplinary innovation processes with open boundaries to include a network of diverse relevant actors, organized in a non-linear way to allow for iteration and feedback between different process phases and actors. We propose seven stakeholder groups that can be relevant in the bioeconomy context and discuss their potential contribution to the innovative firm. To foster interaction between innovative firms and these stakeholders, we advocate a layered network management scheme which divides stakeholders into a core group and a periphery group. Last, the model lists a number of organizational prerequisites that increase the capacity of organizations to develop such an open approach to innovation and implement it efficiently and effectively. These organization prerequisites are: (i) an innovation culture; (ii) leadership support; (iii) good project team configuration; (iv) a clear appropriation strategy; and (iv) adequate resources and capabilities.

Third, we introduce the novel concept of Organizational Innovation System (OIS). This theoretical-conceptual framework adds a micro level to the innovation systems theory based on the Open Innovation and related literature. It can be used as a guiding model for the design and/or analysis of radical innovation projects. The four main structural components of the organizational innovation system are discussed: (i) the innovation process; (ii) the actors; (iii) the innovation network; and (iv) the institutions. The conceptual framework identifies seven functions that an OIS can provide to the innovating organization, including providing opportunities, trends and ideas, reducing uncertainty about the innovative idea, and facilitate supply chain formation. Additionally, ten groups of system failures are listed, i.e. aspects that can hinder the organizational innovation system to work optimally, leading to subpar innovation performance. The combination of the main components, functions and system failure groups allows the analysis of innovation management strategies in different contexts, including the bioeconomy.

Fourth, in the main empirical part of the dissertation, we used a combination of the OIS framework and BioID model to analyse innovation strategies towards the bioeconomy in two very distinct contexts: (i) at the project level at a public research institute and (ii) at the organizational level at private firms. In the first empirical study, we analysed the idea generation phase of three innovation processes originating from a public research institute (PRI). We find that the open innovation approach, which was relatively new to the public research institute, produced a number of positive outcomes, such as increased resources, more and better ideas for innovation, legitimacy for the research, and increased reputation. However, the implementation of the open innovation approach was accompanied with a number of challenges. We found up to twenty-four factors contributing to these challenges, which can be grouped into five main groups: (i) factors related to the environmental context surrounding the PRI; (ii) factors connected to the configuration of the networks that were built by the case researchers; (iii) factors concerning the availability of internal resources; and (iv) internal capabilities; and (v) issues with the organizational structure, culture, and leadership.
In the second empirical study, we analysed the innovation management strategies of fourteen firms in several sectors relevant to the bioeconomy. We took a closer look at the view of the industry on the bioeconomy concept and the innovation management strategies applied in these firms. Most firms find the bioeconomy to be a vague concept that has limited practical use. As to the innovation strategies used, we found considerable levels of communalities regarding strategies across different firms, such as the strong focus on appropriation, the openness to external actors, and the emphasis on creating an innovation culture. Nevertheless, a number of differences exist, which relate mostly to how innovation is perceived in the different firms and how long ago the firms formalized their innovation management strategies.
Fifth, a reflective discussion is made that builds on the lessons learned. We elaborate on four main issues hindering the transition to the bioeconomy: (i) the ambiguous definition of the bioeconomy and related biorefinery and biomass cascade concepts; (ii) the lack of standardized measurement tools and methods for key bioeconomy aspects; (iii) the lack of insight on what contextual factors influence how innovation management should be approached in the bioeconomy; and (iv) the lack of knowledge on how innovation management strategies should be shaped at the organizational level in the bioeconomy. We conclude by formulating a number of recommendations for three of the most important actor groups in the bioeconomy transition. We posit six recommendations for policy makers that can help stimulate innovation towards the bioeconomy, we introduce ten good practices for innovation management in the bioeconomy context, and we suggest a number of recommendations for innovation management researchers on the bioeconomy, aggregated into three main groups.