SAPPHO Revisited: Factors of Innovation Success in Knowledge-Intensive Enterprises in Central and Eastern Europe

This research investigates the mutual and diverging factors for successful and less successful innovations in software and manufacturing of machine tools in Central and Eastern Europe (CEE). We apply univariate and multivariate analyses on 115 indicators by revisiting the seminal SAPPHO project based on the analysis of pairs of innovations and conducted at SPRU – Science and Technology Policy Research during the 1970s. We aim to identify principal factors influencing firm success in innovation in the context of CEE and compare our results to those of SAPPHO and see whether any changes took place during the last 40 years in this context after several decades of globalization. Our initial findings from a database of 90 innovations and 45 pairs of innovations – introduced onto the market during the period 2007-2010 - from 51 CEE enterprises demonstrate that, in particular, user and market-driven factors differentiate successful innovations from less successful ones. Our results fully confirm the continuing relevance of SAPPHO results and methodology. Successful innovators have stronger user orientation and better understanding of market demand. Although, CEECs are catching up economies, continuous and strategic R&D and innovation collaboration is essential to generation of greater commercial success from innovation activities. Given the catching-up character of the CEECs this is surprising result which may reflect knowledge-intensive nature of two sectors which form the basis of our sample. Results of this research clearly demonstrate that orientation of the CEEC innovation policies is inconsistent with the characteristics and behaviour of successful innovators.