There is broad agreement that innovation relies on conducive and sustainable ecosystems. But what exactly are these ecosystems and how best to nurture them?
In late 2017, Saraswati conducted research with support from KOMPAK on promoting sustainable innovation ecosystems for social impact in Indonesia—with a focus on East Java. This research took a systems approach—which suggests that sustainable development outcomes rely on the contributions of multiple and connected actors—and referred extensively to commonly agreed stages of innovation for development. Key findings from this research, which were presented and discussed at the Indonesia Australia Digital Forum 2018 in Jakarta on 1 February.
There were many positives to highlight, such as the proliferation of technology companies, technology hubs, co-working spaces, developer groups, social enterprises, start-up communities, incubators, accelerators, impact investors, philanthropy associations and so forth—and all of these in additional to local governments, civil society organizations and universities that are becoming more active in supporting innovation for development.
Key challenges include the following:
- Adhere to the recognized stages of innovation for development
- Pressure to scale. There has been excessive attention on ideation, prototyping and rushing to scale. The result—often driven by innovation-related competitions—has been a glut of ideas, numerous prototypes, but few sustainable, let alone scalable, innovations.
- Competition fatigue is settling in. While competition is an important ingredient for driving innovation, this may be better encouraged at different stages in the innovation process, rather than solely at the ideation stage. Thousands of prototypes are wilting through neglect.
- The missing middle. The result of pushing for prototyping and then scale is a “missing middle.” This middle is the critical stage of early and later incubation or mentoring, during which partners not only develop their ideas, but iterate in design and develop business plans or action plans that marry operational design with projected revenue models—in order to better plan to market the innovation and ensuring sustainability. A commonly-held perception is that this is not only the result of ideation-focused competitions, but also project cycles that demand tangible impact (a working prototype) and cannot accommodate sustained engagement. This discourages support for the less marketable ongoing process of mentoring and capacity building. In conclusion: innovation ecosystem support should accommodate the innovation cycle rather than project cycles.
- Effective ecosystems benefit from effective information sharing and collaboration
- Lack of information sharing. Innovation partners still work in silos and do not effectively share information—whether this be about innovations produced, lessons learned, available resources or funding opportunities. Stronger information sharing would support replication through inspiring around successful innovation.
- Cross-sectoral collaboration is thin. The most striking examples of working in silos are in the sectoral approaches. Kibar—while noted for its start-up incubation program in collaboration with the Ministry of Communication and Information and some local governments, including the Surabaya municipal government—has never systematically engaged with any development partner. Conversely, the largest development programs do not engage with relevant private sector actors beyond occasional events. And yet there is recognition of the importance of cross-sectoral engagement. Romy Cahyadi from Ltd Indonesia cited important examples of NGO and social enterprise collaborations, where each party focuses on what they do best: NGOs advocate for local needs and enterprise connect emerging markets with buyers. And social enterprises can increasingly consider local governments as a buyer. Many of the companies supporting start-ups and social enterprise acknowledge the growing prospects of these enterprises selling social impact-focused innovations to local government.
- Tailored approaches for innovation ecosystem support are essential
- Don’t force square pegs into round holes. Significant innovation stakeholders include local government, CSOs, social enterprises and start-ups. While there is merit in connecting these actors, ecosystem support should recognize the strengths, limitations and incentives of each—and provide appropriate support to address these. Social enterprises and start-ups benefit from strong business planning. NGOs do not design business plans, but also benefit from strengthening their financial resilience to ensure sustainability. As noted, local governments are guided by regulatory, planning and budget considerations but also view innovation as a source of political capital.
- Social enterprises and start-ups are a significant source of innovative thinking, design, and practice. They should play a central role as an engine of innovation ecosystems. However, support for these enterprises has not traditionally stressed engagement with development partners, NGOs or local governments and has not—in the case of start-up incubation—explicitly addressed support for social impact.
- Universities are an important source of sustainable and locally-based technical assistance for regional innovation ecosystems. Local governments rely on universities for technical assistance and a range of development programs support university based trainers, facilitators and researchers. University-based facilitators on designing for innovation could benefit from learning a more cross-sectoral approach that recognizes the value of different ecosystem actors in supporting and driving innovation.
- Women remain significantly under-represented in the technology for development sectors. This is just as true in Indonesia as it is in worldwide—although in Indonesia the evidence is more anecdotal in the absence of reliable data. While development partners acknowledge the importance of promoting women in civic tech, there are no comprehensive initiatives in Indonesia that engage women technology innovators (such as developers and designers), support their knowledge and skills building, and proactively connect them with suitable job opportunities. Supporting women’s participation and leadership should be an explicit component of any comprehensive approach to supporting innovation ecosystems.
Without being overly prescriptive, recommended approaches to address these challenges include the following:
- Greater attention to promoting local capacity—particularly in universities—through ongoing training and mentoring, rather than facilitation of “hit-and-run” external assistance.
- Development of more systematic cross-sectoral collaboration—including local government, private sector and development partners—through more diversely funded co-design, co-implementation and co-incubation of social impact innovations.
- Greater online sharing of information and knowledge around technology and innovation for development (rather than being sectorally or geographically focused) that marries online information sharing with routine offline events.
- More concerted support for education, training as well as job placement for women in technology.Image credit: George