Home > Statistics > Innovation > 2018 > 11. Most significant factors hampering innovation activity were lack of skilled employees, high costs and challenging market situation as well as different priorities within the enterprise

11. Most significant factors hampering innovation activity were lack of skilled employees, high costs and challenging market situation as well as different priorities within the enterprise

The Innovation Survey inquired from both enterprises with innovation activity and from enterprises with no innovation activity during the survey period about factors that hampered the decision to start innovation activity or in general hampered the execution of innovation activity.

The hampering factors were felt more generally in enterprises with innovation activity than in those that did not have innovation activity in the reference period.

For example, 30 per cent of enterprises with innovation activity estimated uncertain market demand had hampered innovation activity or its starting at least to medium degree, while nearly 10 per cent of enterprises with no innovation activity thought so.

Figure 15. Factors hampering starting or execution of innovation activity by importance in 2016 to 2018, share of those with innovation activity

Figure 16. Factors hampering start or execution of innovation activity by importance in 2016 to 2018, share of enterprises with no innovation activity

According to the survey, factors hampering innovation activity most and most generally were lack of skilled employees in the enterprise, different priorities within the enterprise, market situation or uncertain market demand for the enterprise’s products and too much competition and too high costs of innovation activity.

As many as over 40 per cent of those with innovation activity felt that lack of skilled employees in the enterprise was of at least medium importance. One third assessed that different priorities within the enterprise were at least moderately hampering the enterprise’s innovation activity.

Factors connected to the market situation and uncertainty of demand for the enterprise’s products, as well as views of high costs and lack of internal finance were generally challenges for developing new. Instead, availability of financing and public support – or the enterprise’s access to external knowledge and finding of collaboration partners – did not appear as critical challenges from the viewpoint of innovation activity.

Manufacturing enterprises feel factors hampering innovation activity slightly more generally than enterprises in service industries. For instance, uncertain market demand for the enterprise’s ideas was at least of medium importance for more than every third manufacturing enterprise with innovation activity. In service industries the corresponding share was 25 per cent. Costs of product and process development work are also a more common challenge for enterprises in manufacturing than in service industries.

As a rule, assessments of the importance of different hampering factors with respect to each other appear very similar in manufacturing and services. In manufacturing enterprises lack of skilled employees was a big or moderate hampering factor for 43 per cent of those with innovation activity. The share was 39 per cent in services. Lack of external knowledge was a big or moderate hampering factor in manufacturing for 17 per cent of those with innovation activity and in services for 13 per cent of innovators.

Lack of skilled employees was at least of medium importance for a significant part of enterprises in all size categories. In large enterprises innovation possibilities are burdened by various priorities within the enterprise. Big and extensive markets, alternative technologies and several product lines can cause questions of choice for which reason it is not easy to allocate development work.

As with enterprises with innovation activity, enterprises with no development and introduction of innovations in 2016 to 2018 most often mentioned too much competition in the market as well as lack of skilled employees and different priorities as the factors hampering innovation activity.

Further information about factors preventing and hampering innovation activity by industry and size category

Effect of legislation on innovation activity and factors hampering innovation activity by industry group and enterprise size category

Effect of legislation on innovation activity and factors hampering innovation activity by industr y

Source: Innovation 2018, Statistics Finland

Inquiries: Mervi Niemi 029 551 3263, Heidi Pirkola 029 551 3246, tiede.teknologia@stat.fi

Director in charge: Mari Ylä-Jarkko

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Updated 23.4.2020