February edition of Bilgi Cagi Magazine takes the issue of service innovation. The magazine which aims to emphasize the importance of R&D and innovation for SMEs since the beginning of its publishing life notes that the produced or sold product does not matter but the main issue is the service.
Service innovation concept was born from the dissimilation need of companies. In the magazine the definition of service innovation is given as follows: offering a new and different service. This innovation and difference provides a different structure than product innovation. Service innovation contains a new service, a new service approach, a different presentation of the service, using a product in different ways in terms of service, changes in the distribution of services etc. In addition to technological and organizational capabilities for service innovation, change in human resources and structuring is required.
In our country, Enterprise Europe Network gives innovation support to industrial organizations, universities and especially SMEs with 9 European Union Centers and 2 Innovation Transfer Centers. In this context, Turkey was divided into 7 regions and different consortiums were formed for each region. In this structuring there are 600 local organizations, these organizations with 4000 employees serve enterprises in order to support their competitive power.
Member of the Board for Deloitte Turkey M. Sait Gözüm and Eczacıbaşı Holding Information and Communication Systems Coordinator Levant Kızıltan answered the question of month, ‘Why service innovation has a critical importance in terms of Turkish economy? What can be done to develop service innovation?’. According to Gözüm it is necessary to better apply the idea for service innovation. He states that Turkish companies can make difference with service innovation better than foreign competitors who are innovative in product field. Also Levent Kızıltan states that service innovation is less costly than production innovation.
Cemil Arıkan, Executive Committee Member of National Innovation Initiative, and Selçuk Karata, Coordinator of National Innovation Initiative, state that significant actions are needed for especially significant policy areas to improve service sector. To create a general strategy it is necessary to have a fiction which has been formed with 4 elements. These 4 elements are as follows:
1. Better understanding of innovation in the services sector is needed
2. Apart from technological innovation, all types of innovation should be supported
3. Incentive mechanisms should be created to improve innovative services with high growth potential
4. International cooperation is needed to support the increase of innovation in service sector and better policies are needed for this
Leyla Arsan, the CEO of TAGES, in her article entitled ‘if this country will make innovation, makes the best in service innovation’ states that Turkey is not aware of the importance of innovation which will be held in the area of service for economic development. Arsan continues that in fact there are many organizations who work in this area but who study in this area are not aware of that, there are not institutions to measure this kind of works. In addition the government did not intend to give support or encourage service innovation and did not make any policies regarding this issue. She also states that it is time to change, using new knowledge, reproducing and creating new knowledge. Arsan gives statistical values from the 2009 year report which has been prepared by PRO INNO to show Europe’s and Turkey’s service innovation stage. According to report Turkey has been ranked the 20th whereas Luxembourg has been ranked the 1st in the 27-member EU in 2006. When we look at the 2008 statistics from the same report it is seen that Turkey has shown some progress in one year.
Arsan gives an example about service innovation which she has experienced in a research conference and visit to Food Valley in Wageningen, Netherlands Idea belongs to a manager from Sodexho Catering Company. The aim of the project is to monitor measure and analyze the nutritional habits of people in a restaurant which has been created as a living lab and as a result of this aim; company is able to provide appropriate services to customers. In the restaurant customers’ reactions for food, what amount and type of light, what kind of music or smell are increasing or decreasing the appetite are being monitored as in Big Brother TV program. Neuro-psychologists, statisticians, software developers, food scientists, cognitive scientists, electronics, and marketers are studying together and making experiments.
For Turkey’s case, Arsan states that although there is no direct support for service innovation in Turkey, TUBITAK is supporting process improvement in R&D projects where service sector cooperates with universities.
Finally Arsan offers:
- Minister of Industry and other related ministries should make a joint study with TUBITAK, make policy and improve strategies with business, industry and universities for service innovation.
- Separate funding and incentives should be provided to service sector and other service-producing sectors for R&D projects.
- Regional development agencies should improve their programs and funding to develop this area.
- Turkey Service Innovation Statistics Index should be created and measurements should be made.
- NGOs from ICT sector should create strategic objectives for service innovation.
- TUBISAD’s new created service standards project should be developed further and maintained, implementation should be encouraged. The usage of this system by government will be beneficial for encouragement.
- Public Procurement Law should be improved to develop service innovation.
- Awareness activities should be conducted to unleash the potential of service innovation in Turkey.
- Turkey Investment Support and Promotion Agency should start to introduce Turkey to the world as a service provider country.