This is a crucial question when designing any innovation policy, yet a very difficult one to answer. There is a broad acknowledgment that education, training and skills are important for the economic and social advancement of any society, here including innovation performance. However the lack of conceptual clarity in the academic literature on these matters has not helped answering this question. The literature in the field of business management devoted to study innovation processes in firms has developed a set of relevant notions like “core competencies”, “dynamic capabilities” and “absorptive capacity”. Each of these notions represents different analytical perspectives that put focus how firms’ innovativeness is linked to the development of different sets of knowledge competences. Therefore, they are quite useful from the perspective of the management decisions of individual firms and to understand the general dynamics of these through time. However, this literature has tended to disregard the role that more formal educational and training frameworks outside the firm generally play in the development of these competences, such as primary and higher education systems, vocational training arrangements, etc.

In a recent article, Charles Edquist and I suggest one way to bridge this important gap. We start by defining competences as the set of knowledge, skills and expertise that individuals and organisations have. These are the result of a process to which individuals and organisations are exposed to (typically, a training scheme or a series of new tasks). From an innovation system perspective, one of the most important aspects to consider is the process by which competences are created, maintained and developed in that system; and the fit between the supply of these competences and their demand so that the innovation system has the “knowledge man-power” to be innovative. So far so good. But what competences more concretely? Here comes the conundrum because each society and economy is different, hence, it has a specific set of competences portfolio, and it has particular supply-demand dynamics in this regard.
In order to approach this matter, we suggest a typology of competences along two dimensions. The first one is the set of individual competences (those acquired and developed by individual persons through the education system, vocational training and other formal or semi-formal processes); and those that are organizational competences (which are acquired and developed inside firms or other organizations, like specific know-how, or formal assets like intellectual property rights). Moreover, there is another dimension, namely, those competences that are internal to the firm (typically the human resources of employees developed specifically by the firm), and those competences that are external to the firm, typically acquired by the firm from other organisations through for example university-industry collaboration, user-producer interactions, etc.
This typology of competences might serve to make generic diagnosis of particular deficiencies in an innovation system. Governments are constantly engaged with public, private, and non-profit actors in the creation, maintenance and further development of a broad set of knowledge competences for the innovativeness of their society and economy. Therefore, they need a holistic approach that bridges the world of business management studies’ understanding of competences development, and the complex world of the provision and design of formal and semi-formal education and training schemes.

Reference and link to the article:
Borrás, S and Edquist, C. (2014): Education, training and skills in innovation policy

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