Many factors can either hamper innovation activity, or discourage businesses from innovating at all. This chapter looks at the overall factors cited by businesses as hampering innovation, and explores the differences in these factors by business size and industry.
- The most common factor that hampered innovation to a high degree was the ‘cost to develop or introduce’ an innovation.
- ‘Government regulation’ was the factor that showed the greatest variation in results across industries.
Please view detailed tables 23–24b (in chapter 17 of the pdf or in the available files section online) along with this chapter.
Overall results for factors hampering innovation
The Business Operations Survey asked businesses to rate the degree to which a number of specific factors hampered their ability to innovate. These obstacles or barriers to innovation may have been reasons for not starting innovation activities at all, or for restricting innovation activities.
Figure 11.01 shows ‘costs to develop or introduce’ was the most significant factor hampering businesses’ ability to innovate (19 percent reported that it hampered them to a high degree and 21 percent to a medium degree), followed by lack of management resources (15 percent to a high degree and 20 percent to a medium degree).
Figure 11.01
The factors that businesses reported as not hampering their ability to innovate were:
- access to intellectual property (82 percent)
- lack of cooperation with other businesses (72 percent)
- government regulation (66 percent)
- lack of information (63 percent).
Similar results were obtained in 2007 across most categories.
The factor showing the most change was government regulation. In 2009, 34 percent of businesses cited this factor as hampering their ability to innovate, compared with 42 percent in 2007.
Other impediments to innovation that showed noticeable reductions between 2009 and 2007 were:
- lack of management resources – 52 percent in 2009 and 59 percent in 2007
- lack of appropriate personnel – 46 percent in 2009 and 53 percent in 2007.
These changes could be due to many factors, such as changed business conditions between the two collection periods.
Figure 11.02
Results by industry and business size
Some factors affected certain industries less than others. For example, government regulation was a hampering factor for a high proportion of businesses in the education industry (24 percent), but a low proportion in the other services industry (1 percent).
Some factors also affected certain business sizes less than others. For example, 15 percent of smaller businesses (6–49 employees) saw lack of management resources as hampering innovation to a high degree, compared with 11 percent of larger businesses (50+ employees). All other factors show little variation with business size.