It has become commonplace to see Finland ranked among the most innovative countries in the world. In March, an article in the Harvard Business Review ranked Finland number two globally, while a month later the Economist Intelligence Unit placed the nation at number three. Finland’s high rankings are a result of a long-running national strategy to focus upon innovation, but this plan is also being followed at a local level. At the heart of innovation in this Nordic country is little Otaniemi, a small area to the west of the capital Helsinki.
Located on a green peninsula in the city of Espoo, Otaniemi is a unique mix of businesses, education and research institutions. It is a community that consists of about 16,000 students and an equal number of technology professionals. About 800 high-tech companies are based around the area, and almost one new company is founded each week. Altogether about 200 patents come out of Otaniemi’s companies and research groups each year.
Otaniemi is the heart of Finnish innovation in large part because of the major players based there. Nokia is the best-known example, but the mobile phone company is only one of many hi-tech firms in the area. Outotec, which supplies technology to the metals and minerals industries, is also located nearby. “In my opinion, the most important reason we maintain a competitive advantage in innovation is the level and efficiency of the education in Finland,” Tapani Järvinen, CEO of Outotec says. “That is the backbone for innovative and novel solutions.”
Otaniemi is home to the nation’s largest educational institution, the Helsinki University of Technology, which maintains close ties with the companies of the area. The technical school is currently merging with the Helsinki School of Economics and the University of Art and Design Helsinki to form Aalto University, named after Finland’s most famous architect and industrial designer Alvar Aalto.
“Aalto University is a marriage of technology, business and art and design,” says Kalevi Ekman, vice-rector of the University of Technology. “It is not a very new idea, but surprisingly this kind of marriage is very rare. I don’t know of any other example in the world. It is quite common that industrial design and engineering are organised in the same institute, but having all these three together is original.”
Innovation as a national and local strategy
One of the main purposes behind the merger of existing universities is an increased multidisciplinary approach in education aimed at strengthening innovation and entrepreneurship. In fact, the working title for the new institution was the Innovation University. Also telling is that the first organisation created by the students is the
Aalto Entrepreneurship Society.
The new university is just one more step in the strategic focus on sustainable innovation which has been on the national agenda since the collapse of the Soviet Union. Finland’s largest trading partner disappeared overnight, plunging the nation into one of the worst peacetime recessions of any developed country. The recovery was difficult, but the plan for a national focus on innovation worked. Economic Prosperity Recaptured, a new book published by MIT Press, makes the case that Finland’s above-average economic growth since the mid-1990s is largely a result of a structural transformation into an innovative, hi-tech economy.
To some extent, the focus on innovation was forced. Finland does not have the natural resources available to some of its neighbours. But while the economies of Norway and Russia are at the whim of the market price of oil, a broader strategy of focusing on innovation leaves Finland unscathed by falling commodity prices.
Strengthening innovation remains a priority in the highest reaches of government. President Tarja Halonen acts as patron to Innofinland, which promotes creativity and entrepreneurship while Prime Minister Matti Vanhanen chairs the Science and Technology Policy Council. The Finnish government distributes liberal funding via Tekes and Sitra, the national R&D and innovation funds. With public support R&D investment as a percent of GDP is the second highest of any OECD country. Finland is also ranked third in patents per capita.
At the local level, the city of Espoo’s strategy to continue developing the Otaniemi area takes the same multidisciplinary approach found at Aalto University. The ambitious goal of the City Council is to attract the best businesses, researchers and students in order to create one of the leading centres for innovation in Europe. New residential areas, parks, metro stations, conference facilities, office buildings, sports halls and culture centres are all in various stages of planning or construction. While a great deal has already been accomplished, even more is in the works.
New innovations and new innovators
The focus on innovation is best exemplified by Design Factory, one of the new projects of the university. “This is an experimental platform for education, research and application of product design,” Professor Ekman explains. “We can and we should start high-risk projects. If we never fail, the risk level is not the right one. The companies have ideas but might lack courage to test those ideas in a real environment. In our environment, we are able to test more crazy things.”
The results of their testing are everywhere in the building. Some of the furniture charges mobile devices wirelessly. In the event the smoke detector goes off in a demonstration kitchen, electricity is cut, emergency exhaust fans start sucking smoke and green LED lights show a person the escape route. All this creativity even manifests itself in everyday objects: a close examination of a light fixture over a conference table reveals that someone created a new light shade out of paper.
One of the principles of the Design Factory is to encourage multidisciplinary collaboration and interaction by whatever means available. As an example, people are forbidden from having coffee in their offices. If a person wants a coffee break, they have to go to the communal kitchen and interact with others doing the same thing. Another example is a giant knitting machine so situated that each visitor comes into contact with it. “This machine always attracts attention,” says Professor Ekman. “Space scientists will stop and ask questions: ‘Can it sew metal?’ People are very curious.”
The Design Factory maintains rooms for teaching, research, workshops and socialising. Companies are also present. Nokia has an office only a couple metres away from Powerkiss, a one-year old company that integrates wireless charging for mobile devices in furniture and other everyday surroundings. The easy accessibility of major corporations is a prime draw for participants.
“Would it be better if you had more face-to-face interaction?” Professor Ekman asks. “This is not just cooperation but co-creation, co-designing, co-research. Students, teachers and people from industry do this together. I am very happy that we got this Design Factory, this physical space, where all this can take place.”
The environment of Otaniemi is being developed to facilitate this interaction of business leaders, researchers and students in which they hope big things will happen. Professor Ekman calls these “planned coincidences” and is fascinated by the process. Instead of industry or academia working in isolation, he is a big believer in cooperative innovation. “Something really interesting can come out when we push things forward,” he says.