Innovation in R&D service firms: evidence from the UK

Figures & data

Table 1. Synthesis of features of R&D service firms, KIBS, and NTBFs.

	R&D service firms	KIBS	NTBFs
Features	Knowledge-intensive Technology-based	High knowledge intensity Highly qualified human capital High level of consulting activities Intensive use of ICTs	Newly established Technology-intensive
Firm size	SME-dominated	SME-dominated	SME-dominated
Firm origin	New established firms Spin-offs	Originally independent firms Institutional spin-offs	Spin-offs from universities or well-established firms
Location	Science and technology cluster, e.g. the Cambridge area	Concentrate in metropolitan areas	In or around major urban areas and science parks
Business activities	Contract development models Licensing models	Problem-solving A high share of consulting activities	Consultants and R&D contracting Technology asset oriented Product-oriented
Roles in innovation	Innovation intermediates Perform linking function between public and private research and the market Play an integral role in the local and regional innovation system	Users, carriers and sources of innovation ‘Second knowledge infrastructure’ Innovation intermediates	Play important role in the technologies transfer from parent organisations Agents of technology diffusion Key elements to catalyse economic growth and strengthen the industrial base
In-house innovation	The prevalence of in-house R&D	Close interaction with customers Rely more on ‘soft’ sources than ‘hard’ sources Heterogeneity	Invest in in-house R&D Exploit the knowledge created within the innovation ecosystem

Source: Synthesised by the Authors.

Table 2. Enterprises engaging in innovation activity, by activity type, 2012–2014.

	R&D service firms	KIBS firms	All firms
Innovation active	70.9	64.6	53.0
Product innovator	38.3	31.5	19.2
Process innovator	25.2	20.9	12.8

Source: UKIS 2015.

Table 3. Co-operations in innovation activities, 2012–2014.

	R&D service firms	KIBS	All firms
Other businesses	57.7	49.4	43.7
Suppliers	54.4	59.2	67.4
Clients (private sector)	68.9	63.5	58.2
Competitors	38.0	29.0	31.4
Consultants	60.6	28.3	24.7
Universities	65.7	29.0	21.0
Government	43.9	14.4	14.2

Source: UKIS 2015, ONS.

Table 4. Key features of interviewed R&D service firms.

Innovation	Structural characteristics					Innovation
Firm Code	NACE	Founded	Employee (2013)	Location	Sector	In-house R&D	External R&D	New/improved services	New/improved goods	New/improved process	Patents/IP
F1	72.11	1999	81	Cambridge	Pharm	Y	Y	Y	Y	Y	Y
F2	72.11	2007	250	Cardiff	Bio, Pharm	Y	N	Y	N	Y	Y
F3	72.11	2001	69	London	Bio, Pham	Y	N	Y	N	Y	Y
F4	72.11	2000	135	London	Bio, Pharm	Y	N	Y	N	Y	Y
F5	72.11	2008	49	Edinburgh	Bio, Agriculture	N	N	Y	N	Y	N
F6	72.11	2003	30	Bristol	Bio, Pharm	Y	Y	Y	N	Y	Y
F7	72.11	1997	180	Cambridge	Bio, Pharm	Y	N	Y	N	Y	Y
F8	72.11	1989	86	Cambridge	Bio,	N	N	Y	N	Y	N
F9	72.11	1990	35	London	Bio, Pharm	N	N	Y	N	Y	N
F10	72.11	1999	32	Horsham	Bio, Pharm	N	N	Y	N	Y	N
F11	72.19	2004	231	Reading	Pharm	Y	Y	Y	Y	Y	Y
F12	72.19	1999	1,290	Cambridge	Bio, Pharm	Y	Y	Y	N	Y	Y
F13	72.19	1988	398	Oxford	Food drink	N	Y	Y	N	Y	N
F14	72.19	1985	126	Oldham	Gaming, retail	Y	Y	Y	Y	Y	Y
F15	72.19	2006	11	Hampshire	Chemical	Y	Y	Y	Y	Y	Y
F16	72.19	1988	120	Cambridge	Chemical	Y	N	Y	N	Y	Y
F17	72.19	1985	200	Stafford	Construction	Y	Y	Y	Y	Y	Y
F18	72.19	2001	44	London	ICTs	Y	Y	Y	N	Y	Y
F19	72.19	1990	111	London	Water	N	Y	Y	Y	Y	N
F20	72.19	2004	120	Kent	Fruit, forest	Y	Y	Y	Y	Y	Y
F21	72.19	1990	581	Dublin	Pharm	Y	Y	Y	Y	Y	Y
F22	72.19	2003	45	Cambridge	Life science	Y	Y	Y	Y	Y	Y
F23	72.19	2002	33	Durham	Chemical	Y	Y	Y	Y	Y	Y
F24	72.19	1956	350	Hampshire	Telecom	Y	Y	Y	Y	Y	Y
F25	72.19	2000	70	Manchester	Bio	Y	N	Y	N	Y	Y
F26	72.19	1989	120	Essex	Automotive	Y	N	Y	Y	Y	Y
F27	72.20	1995	292	Blackthorn	Clinical research	Y	Y	Y	N	Y	Y
F28	72.20	2000	97	Cambridge	Policy making	N	Y	Y	N	Y	N
F29	72.20	1995	60	Oxford	Regional development	N	Y	Y	N	Y	N
F30	72.20	1978	45	London	Economic analysis	N	Y	Y	N	Y	N
F31	72.20	2001	40	Warwick	Outcome measurement	Y	Y	Y	Y	Y	Y
F32	72.20	1982	27	Harrow	Therapeutics research	N	N	Y	N	Y	N

Note: N=No, Y=Yes.

Pharm: pharmaceutical; bio: biotechnology; ICTs: Information and communications technology.

Figure 1. In-house innovation of R&D service firms. Source: Authors.

Figure 2. The degree of openness of R&D service firms’ innovation. Source: Authors.

Table 5. KIBS-like and NTBFs-like R&D service firms.

	Attributes	KIBS-like	NTBFs-like
Structural characteristics	Number of firm	10	22
	Industries	Social science	Pharmaceutical
		Food and drink	Biotechnology
		Water and wastewater	Telecommunication
		Biotechnology
	Revenue streams	Contract R&D	Contract R&D
			Licensing IP or
			Selling products
In-house innovation	Processes	Unstructured	Structured
	Sources of ideas	Client-interface	Scientists and researchers
	Development	Ad-hoc	In-house R&D
	Implementation	Rapid application	Not rapid
			Testing before market launch
	Outcome	Services	Services
			IP/Products

Source: Authors.

Figure 3. R&D service firms, KIBS and NTBFs. Source: Authors.