Lost in Translation? National characters and perception of “innovation”

GOTO Akira
Faculty Fellow, RIETI

What is perceived to be an innovation?

How innovative does something have to be in order to be perceived as an innovation? Is the expected degree of innovativeness the same across all countries? Consider the following case examples:

  1. A photographic film manufacturer was first to use photographic film technology in developing a protective film for liquid crystal display screens.
  2. A manufacturer, continuously advancing in energy-efficiency for their products, has reduced the annual energy consumption of its latest large home-use refrigerator model by 5%.
  3. An anti-virus software vendor has released a virus detection program to counter a new type of computer virus.

Asked whether they perceive Case 1 to be an innovation, 34.5% of Japanese respondents said they do, compared to 54.1% of Americans and 46.4% of Germans. Likewise, Case 2 is perceived to be an innovation by 14.9% of Japanese, 32.4% of Americans, and 30.4% of Germans, and Case 3 by 7.9% of Japanese, 32.3% of Americans, and 23.0% of Germans.

These are some of the findings from a very interesting and meticulous survey conducted by Yutaka Yonetani, a researcher at the National Institute of Science and Technology Policy (NISTEP). The survey presented a total of 25 case examples such as those listed above and asked respondents in Japan, the United States, and Germany whether each of those cases constitutes an innovation. Overall, the proportion of respondents recognizing innovativeness is the highest in the United States and the lowest is in Japan with Germany in between. (For the details of the survey, refer to Yonetani, Y., “A Report on the Comparative Survey regarding the Perception of ‘Innovation’ in Japan, USA and Germany,” NISTEP Research Material No. 208, March 2013.)

The survey was conducted in a way to answer my long-standing question. In 1997, I conducted the first-ever innovation survey (questionnaire survey) in Japan, with the same survey carried out by my fellow researchers in the United States, to compare the two countries regarding the appropriation of innovations (See Cohen, W., A. Goto, A. Nagata, R. Nelson, and J. Walsh, “R&D Spillovers, Patents and the Incentives to Innovate in Japan and the United States,” Research Policy, Vol.31, 2002, pp.1349-1367).

Perception of innovation differs across countries

In the course of this joint research, I realized that my American colleagues and I have different ideas of what constitutes an innovation. Simply put, even those that seemed to be no big deal to me were regarded as innovations by them. It would be reasonable to define “innovation” as a product or production method that is novel and different from existing ones. But this brought me to another question: Do we all have the same idea about the degree of differences that would make a product or production method an innovation? I suspect that different countries have different ideas.

In Japan, the term “innovation”?or “inobeshon” as pronounced in Japanese?is used as a borrowed word. As such, it may be the case that the term is taken as meaning something very impressive. If we conduct a survey of small and medium-sized enterprises (SMEs) and ask about their innovations, many of them would say that they are engaging in no such inordinately ambitious activities.

This may be related to the fact that innovation in areas other than technology such as organizational innovation has been categorically excluded from “innovation” as perceived in Japan probably because the government's white paper on the economy once used “gijutsu kakushin” (which literally translates as “technological innovation”) referring to innovation.

Innovation surveys often find that Japan has a lower percentage of businesses engaged in innovation than the United States and Europe. However, does this necessarily mean that Japanese companies are not innovative? Such survey findings might be in no small part attributable to differences in the perception of innovation.

The aforementioned survey by NISTEP was conducted in response to this long-standing question of mine, and, as discussed above, my suspicion has been confirmed. Professor Patarapong Intarakumnerd, my colleague from Thailand and an innovation researcher, points to the same tendency in his country where innovation is generally perceived to be something highly sophisticated and refined. It may be the case that non-English-speaking countries, developing countries, and SMEs actually have made few achievements that can be called “innovation” regardless of its definition. However, I infer that differences in perception have had an impact on the survey results.

Appropriate criteria for what constitutes an innovation

What degree of novelty or departure from the conventional standard is enough to be considered an innovation? This is a very difficult question that gives rise to another, more fundamental question: What constitutes an innovation? Some definitions of “innovation” are provided in the Frascati Manual of the Organisation for Economic Co-operation and Development (OECD) as well as in its Oslo Manual, a set of guidelines for innovation surveys, but they do not provide an answer to the question. It is impossible just to draw a line on a continuous spectrum of the degree of novelty or departure from the conventional standard to separate those that are considered innovations and those that are not. This means that international comparative studies of innovations may end up providing wrong interpretations of survey findings if they fail to pay due consideration to country-specific systematic bias. Although we may all talk about innovation, what we have in mind can be quite different depending on our nationality.

May 20, 2014

May 20, 2014

Article(s) by this author