Regional Innovation Monitor Plus 2016€¦ · Figure 3 Dana Power Management Provider project .....15! Figure 4 Dana-Rexroth expertise ... The RIM Plus 2015-2016 evolved from a general

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30 May 2016

Regional Innovation Monitor Plus 2016 Regional Innovation Report Trento (Industry 4.0 and smart systems)

To the European Commission

Internal Market, Industry, Entrepreneurship and SMEs Directorate-General

Directorate F – Innovation and Advanced Manufacturing

Regional Innovation Monitor Plus 2016

Regional Innovation Report Trento (Industry 4.0 and smart systems)

technopolis |group| in cooperation with

Eleonora Zoboli, Technopolis Group Belgium

Regional Innovation Monitor Plus 2016 i

Table of Contents 1. Advanced Manufacturing: Industry 4.0 and smart systems 5!

1.1 Overview of performance and trends 5!1.2 Business sector perspective 6!1.3 Scientific research potential 8!1.4 Role of intermediary institutions 9!1.5 Developing skills for the future 9!1.6 Major investment projects 10!1.7 International cooperation 11!1.8 Policy support and delivery mechanisms 13!1.9 Good practice case 15!1.10 Leveraging the existing potential 18!

2. Regional Innovation Performance Trends, Governance and Instruments 20!2.1 Recent trends in innovation performance and identified challenges 20!2.2 Institutional framework and set-up 22!2.3 Regional innovation policy mix 25!2.4 Appraisal of regional innovation policies 31!2.5 Policy good practice 33!2.6 Possible future orientations and opportunities 34!

Appendix A Bibliography 37!Appendix B Stakeholders consulted 38!

ii Regional Innovation Monitor Plus 2016

Table of Figures

Figure 1 Expenses for R&D, total, in Million Euro, Provincia Autonoma di Trento ....... 8!Figure 2 Exports in the manufacturing sector over GDP, at current prices, in percentage ........................................................................................................................ 12!Figure 3 Dana Power Management Provider project ..................................................... 15!Figure 4 Dana-Rexroth expertise ................................................................................... 16!Figure 5 Bonfiglioli’s Mechatronic Drives & Solution (MDS) Division .......................... 17!Figure 6 Bonfiglioli’s R&D map ...................................................................................... 17!Figure 7 Bonfiglioli’s energy recovery system ................................................................ 18!Figure 8, Total intramural R&D expenditure (GERD) by sectors of performance, as percentage of GDP .......................................................................................................... 20!Figure 9 Propensity to patent, number of patents registered over number of residents (* 1,000,000) ................................................................................................................... 21!Figure 10 Number of patent applications to the EPO by priority years for selected technologies in Trento .................................................................................................... 22!Figure 11 Trentino’s research and innovation system ................................................... 23!Figure 12 Single Data Centre Trento – structure and objectives .................................. 33!Figure 13 National and international initiatives taken as example for the Single Data Centre .............................................................................................................................. 34!Figure 14 Single Data Centre roadmap .......................................................................... 34!

List of Tables

Table 1 Regional innovation support measures 28!

Regional Innovation Monitor Plus 2016 1

PREFACE In the context of the growth and investment package set out in the Investment Plan of the European Commission, the Regional Innovation Monitor Plus (RIM Plus) provides a unique platform for sharing knowledge and know-how on major innovation and industrial policy trends in in some 200 regions across EU20 Member States.

Launched in 2010, the Regional Innovation Monitor aimed at supporting sharing of intelligence on innovation policies across EU regions. Building upon the experience gained and results obtained during the period 2010-2012, the RIM Plus 2013-2014 provided practical guidance to regions on how to use the collected information, via a network of regional experts. Since 2014, the RIM Plus has introduced a thematic focus on advanced manufacturing.

The RIM Plus 2015-2016 evolved from a general monitoring of innovation policies towards establishing a more thematic focus in selected areas in order to contribute to improving the competitiveness of European regions.

Particularly, the RIM Plus aims through its activities and in close cooperation with the regional stakeholders and other relevant initiatives to:

•! Contribute to the development of new and open spaces of collaboration and exchange on advanced manufacturing, each with a clearly defined thematic focus.

•! Play an enabling role in providing evidence-based information on specific themes and bring in outside perspective from other regions.

•! Map out regional practices in support of advanced manufacturing and relevant pilot/demo projects and work towards involving the relevant stakeholders.

•! Provide an easy access and comparative overview of regional innovation policies and relevant actions in the field of advanced manufacturing.

•! Share the lessons learned with the European Commission services to feed into the preparation of future programmes.

The main aim of 30 regional reports is to provide a description and analysis of developments in the area advanced manufacturing with a clearly defined thematic focus and regional innovation policy, taking into account the specific context of the region as well as general trends. All regional innovation reports are produced in a standardised way using a common methodological and conceptual framework, in order to allow for horizontal analysis, with a view to preparing the Final EU Regional Innovation Monitor Plus report.

European Commission official responsible for the project is Alberto Licciardello ([email protected]).

The present report was prepared by Eleonora Zoboli ([email protected]). The contents and views expressed in this report do not necessarily reflect the opinions or policies of the Regions, Member States or the European Commission.

Copyright of the document belongs to the European Commission. Neither the European Commission, nor any person acting on its behalf, may be held responsible for the use to which information contained in this document may be put, or for any errors which, despite careful preparation and checking, may appear.

Further information:

https://ec.europa.eu/growth/tools-databases/regional-innovation-monitor

2 Regional Innovation Monitor Plus 2016

Executive Summary

1. Advanced Manufacturing: Industry 4.0 and Smart systems

When assessing the importance of advanced manufacturing in Trentino, the efforts put in place for the creation of a fully interconnected and inter-sectoral system between the research world, the business world and the public institutions should be considered.

In Trentino, the highest contribution to value added derives from services (73.1%), industry (23.5%) is in second position, and then agriculture (3.4%). Despite manufacturing not being the leading sector of Trentino’s economy, there is an increasing specialisation in a number of manufacturing sectors related to advanced manufacturing and Industry 4.0; one of them is mechatronics, a priority, together with agro-food, life quality and green energy and environment, of the Operative Programme (O.P.) 2014-2020. 50% of the industrial patents registered in the last years belong to mechatronics, as well as 25% of the innovative start-ups. There are 300 companies operating in the sector, employing approximately 1100 persons.

Trentino excels in basic and applied research, and this is increasingly internationally recognised. The expense in R&D over GDP is steeply increasing, especially since 2007. The personnel employed for R&D in full time equivalent is also increasing since 2008. The growing number of spin-off from research comes in support of the attractiveness of Trentino’s research system. While Trentino enjoys a truly international system of academic research, with more and more visiting professors and fellows from abroad, companies tend to work with local research centres.

In terms of potential to develop innovation-intensive sectors in areas such as Industry 4.0, the structural characteristics of the Trentino economy are together an advantage and a disadvantage; the small size of companies has proven to be an impediment to do research, due to the lack of critical mass and the absence of strong industrial clusters. These factors account for a generally low propensity to innovate (number of patent applications). Nonetheless, Trento holds the record of innovative micro-enterprises by region in Italy (40.7%); the most innovative are in the manufacturing sector. The presence of multinational companies in Trentino is mostly strategic due to the vicinity to the Austrian and Swiss borders and to the skilled human capital that companies can find in the Province. Some important multinationals set-up their research department specialized in mechatronics in Rovereto (Trento), in particular, Bonfiglioli and DANA have been selected as good practices cases for this report (Section 1.9).

As just mentioned, Trentino is generally well-equipped in terms of availability of skilled human capital for applied science and research: the number of students at the second stage of tertiary education leading to an advanced research qualification increased since 2007, while the same statistics decreased for Italy. The number of resident population with a degree in science and technology was steadily increasing from 2007 until 2011. The development of skills and competences related to advanced manufacturing goes hand in hand with these trends, and it is supported by important projects in the area of mechatronics and manufacturing.

The most important and interesting investment project related to Industry 4.0 is the Polo della Meccatronica (the Mechatronic Cluster), inaugurated in 2014. The project has planned the construction of a new building, next to the existing one, to host research centres, laboratories, and companies in order to create a place of exchange and knowledge integration. Another important project is Progetto Manifattura (Project Manufacturing).

Trentino is also trying to promote inter-regional collaboration and networking thanks to the KICs (Knowledge and Innovation Communities); the Province will soon be preparing the KIC on advanced manufacturing and raw materials. Other areas where Trentino is involved in international projects at European level are Smart Cities,


internet of things and open data. One important international partner in the area of Industry 4.0 for mechatronics is Japan.

2. Regional Innovation Performance Trends, Governance and Instruments

The strategic choice to focus on innovation, technology and research came from the need to stimulate the development of an economically depressed area back in the 1980s-1990s. In light of this, Trentino decided to invest consistently in R&D and in the development of an ICT cluster. The Province has also built a competence triangle that embeds microsystems, agro-food and tourism. This, in turn, has prompted lead markets in sectors such as e-Health, mechanics, sustainable construction but also neuroscience, nanotechnology, and genomics.

In terms of inputs, total intramural expenditure in R&D (GERD) as a percentage of GDP for the last four years (2011-2014) is slightly below the European average but higher than the Italian one, while the government expenditure in R&D is always higher than the European. However, the business sector expenditure is lower than the European average. The input from the government is historically high in Trentino, and the Province should strike to find a balance between public and private funding. Starting from 2005, the Province has started a structural reform of the research and innovation system in order to better link the world of education, research and enterprise. In terms of output, total R&D personnel, as a percentage of total employment is higher than the EU28, and definitely one of the highest in Italy. The importance of the research sector is also supported by an increasing number of researchers in the last ten years.

Trentino is one of the Italian special status regions, as such, the government of the Province has stronger autonomy and exerts public functions that normally belong to the Italian central government. Trento has full autonomy in designing and implementing aid schemes, infrastructures, education and training. It also has full autonomy in the design and implementation of enterprise, technology and innovation policies. The orientation of the government policies since 2013 focused towards transversal elements for smart specialisation strategy, like social innovation, social inclusion innovative start-ups; this also broadening the scope of action in innovation policies and practices. The system of business incentives for companies is one of the most structured and dynamic in Italy and Europe.

Other entities of the Province that are involved in addressing and coordinating the Trentino enterprise and innovation system are: Trentino Sviluppo, Trentino Network, Informatica Trentina, the University of Trento, the Bruno Kessler Foundation, the Edmund Mach Foundation, and Trento RISE operative until the end of 2015,

In order to understand the local framework of innovation policies in Trento, one must refer to two specific but comprehensive normative references: The Provincial Law of the 2 August 2005, n.14 and the Law 6/99 (then modified by Law of the 1 August 2011, n.12). In terms of the more general policy framework and extra-local instruments, Trento has defined a limited number of objectives taken as investment priority for the ERDF funding period 2014-2020: the total allocated resources for “strengthening the research, technological development and innovation” cover the largest part of the resources to be allocated (50.5%). Allocated funds for “improving SMEs competitiveness” are 25.5%, while “transition to a low-carbon economy” takes 20.0% of the resources.

In the context of the assessment of R&D activities, the two main bodies operating as evaluators are the Technical-Scientific Committee for Research, and the Research Evaluation Committee. Regional evaluation on research and innovation, especially in the context of European Structural Funds (ESF) are mainly thematic, or focus on specific years of the programming period; while this does not allow to draw comprehensive conclusions on the impact, coherence and effectiveness of the measures undertaken in the last 10 years, identified evaluations for previous programming periods, and the arguments behind the choice of the new thematic


objectives, are overall positive and well argued. Especially since 2009, the most important bottleneck toward the coherent and complete realisation of the predetermined policy objectives is reported to be the economic crisis and the fragmented decision making system in the Province.

3. Future Actions and Opportunities

Trentino’s aspiration to be internationally recognised as a pioneer of the ‘new industrial revolution’ require a constant effort to equip its economy and society for reaching this goal and for maintaining a position in the high ranks. Many steps have been taken by the Province to build a successful strategy towards advanced manufacturing and Industry 4.0. Mechatronics and the digital agenda are in particular top priorities. Nevertheless, some challenges have been identified, that refer broadly to R&D, and also specifically to Industry 4.0.

•! Challenge 1: Dependency on the local government as a source of funding.

Public resources for R&D are shrinking in recent years due to the economic and financial crisis. The relatively low financing of R&D from private sources is a characteristic of the Province. Although the reform of the research system has strengthened the role of the private sector in funding research, Trentino should keep on working in this direction, especially in the context of Industry 4.0 and manufacturing, where important multinationals have already chosen Trentino to establish their research centres.

•! Challenge 2: Improve technological transfer.

This challenge, which is linked to the specialisation of Trentino in basic and applied scientific research, has to do with the possibility of improving the delivery of results in other innovation phases, like commercialisation and diffusion. For Industry 4.0, the on-going projects are tackling this specific aspect with the investment in new laboratories and open spaces to host companies, researchers and businessman to make them work together. However, the full realisation of this potential is not yet observable, and it will take at least another couple of years to be able to assess its success or failure.

•! Challenge 3: Building industrial clusters in a territory dominated by SMEs

Due to its orography Trentino has a limited area to be dedicated to production and urban settlement. These characteristics are also at the basis of the industrial structure of Trentino, which is dominated by SMEs. Despite the innovation performance and the dynamism of many of these SMEs being relatively high, Trentino can work more to improve the visibility of its ‘champions’: one way is to build clusters around them, in order to increase their capacity to face international competition, and also to increase trade openness (there is a relatively low propensity to export). Thanks to the development of hardware that behave as software, the Industry 4.0 revolution should enable smaller companies to me more competitive, by reducing the relative relevance of labour costs as a determinant factor for competition. The Polo della Meccatronica and other projects such as Progetto Manifattura attempt to include SMEs in newly formed clusters around this concept. The challenge-opportunity will stand in the ability to make this ambitious program, a concrete reality.

!


1.!Advanced Manufacturing: Industry 4.0 and smart systems

1.1!Overview of performance and trends The autonomous province of Trento (Provincia Autonoma di Trento) is a special statute region situated in the Northeast of Italy. It is relatively small and predominantly mountainous (70% or more of the territory is over 1000meter altitude, and more than 50% is covered by forests). With a population of 537,416 in October 2015, it is one of the less densely populated regions of Europe. Tourism is one of the most solid sectors of the economy, followed by construction and agro-food. The Province is relatively wealthy, especially if compared to other Italian regions, but also in comparison with EU28 GDP per capita at current prices, which in Trento was €33,700 in 2014, corresponding to 123% of the EU28. The real GDP growth rate was -4.5% in the period 2008-2010. The growth rate averaged 2.7% between 2010 and 2013, and stabilised in the last two years available (2013 and 2014).

Manufacturing in Trentino accounts for 61.2% of the industrial compartment1 in terms of production units and for 69.7% in occupational terms, according to 2012 data2. Trentino’s employment in manufacturing over total NACE activities (12.73%) is a lower proportion than services and compared to the national average for manufacturing (15.0%); this is especially the case for employment in manufacturing sectors with medium and high technological content. Also employment in services with high technological content is not high compared to the national share (6.5% in Trentino versus 8.1% in Italy)3. The statistics on value added at basic prices, estimated for Trento to be €16.36 million in 2014, help to explain Trentino’s industrial economic structure. The highest contribution to value added derives from services (73.1%), industry (23.5%) is second, and agriculture accounts for 3.4% of the value added4. The share of industrial value added over the total value added, expressed in chained-linked prices, decreased from 25.7% in 2005 to 22.3% in 2014, however, this trend was more or less in line with the EU15 (26.1% in 2005 to 23.4% in 2014) and the Italian shares (26.1 in 2006 to 23.2% in 2014) for the same period.

Despite manufacturing not being the leading sector of Trentino’s economy, there is an increasing specialisation in a number of manufacturing sectors related to advanced manufacturing and Industry 4.0. From 2013 to 2014 the Province registered an increase in the number of employees in the chemicals, pharmaceuticals and rubber sectors (+230), machineries and other transport (+178), and metals and metallurgy (+162). While manufacture of machineries is important for mechatronics, metals enters as an input into the production of cyber-manufacturing and for the avant-garde applications of 3D printing. With reference to the time series from 1989 to 2009 (year 1989=100), the recent increase in the number of employees in metals and metallurgy signs an inversion of an historic trend (the % variation over 20 years was -10.9% in terms of employment. After 2009 the trend started its inversion). On the contrary, employment in manufacture of machineries and other transport confirms an upward long-term trend (+79.4% variation over the same period), and a stable trend for chemicals, pharmaceuticals and rubber (+2.0% variation).

1 The other sub-sectors or activities falling under Industry for the report “l’industria nella Provincia di Trento – situazione al Giungo 2014” (2014) are the extraction sector, energy, water and waste, constructions, civil engineering, installations, sales and repair od motor vehicles

2 Eurostat latest data available. It must be noted that the share of agriculture is still higher than many other regions and the EU28 average.

3 Available at: http://www.statweb.provincia.tn.it/IndicatoriStrutturali/ 4 Available at: http://www.tn.camcom.it/8368/pdf/Industria2014.res


The ICT sector also holds an important role in the Province. Trento made significant investments in this sector as part of its innovation strategy since the beginning of the 2000s. However, this investment must be seen in a long-term perspective and it is not yet fully reflected in statistics: in 2013 the value added at basic prices was €398.27 million, corresponding to approximately 2.5% of the total value added for both 2012 and 20135. This data is lower than the national average (4.0%) and than the European one (4.9%) for the same years. It is not possible to fully assess how this sector has gained importance in Trentino over a longer time period, since data are only available for 2012 and 2013.

When assessing the importance of advanced manufacturing in Trentino, one must consider more broadly the efforts put in the creation of a fully interconnected and inter-sectoral system that involves the research, the businesses and the public institutions. In this perspective, the performance of a number of service sectors assumes an important role. For instance, 2014 data on the number of employees in professional, scientific and technical activities were in line with the Italian average, and the same statistics was always higher than the European average employment in the same activities in the period 2008-20146. Trentino also registers record employment in activities related to social work, public administration, education and human health (NACE codes O_Q), where the share of employees for the same age category over total NACE activities is always higher than both national and EU28 averages (26.44% in 2014, compared to 20.63% for Italy and 25.30% for EU28). !

1.2!Business sector perspective Micro-and small companies dominate Trentino, which is a characteristic feature of both Trentino and Italy. Due to its mountainous territory, the presence of small and local units is further accentuated.

Companies with more than 200 employees represent only 3.5% of the total, while micro and small companies (up to 50 employees) account for 73.0% of the local units. Medium size companies (51 to 200 employees) account for 23.5%. The latter are the most important in terms of employment share (43,6%), however employment in small companies has slightly increased in the recent period7. Among these medium-to-large companies, some are leaders in their sectors. An example is Aquafil, a Nylon6 yarn producer, a filament used to make carpets and tights. There are also companies with a maximum turnover of €100 million, but dominating some niche markets; an example is La Sportiva, leader in the production of hiking shoes, and direct competitors of NIKE for this market.

The presence of multinational companies in Trentino is mostly strategic due to the vicinity to the Austrian and Swiss borders, and the skilled human capital that companies can find. The majority of these multinationals belong to the manufacturing sector (e.g. pharmaceutical, mechanics, non-metallic minerals). Companies like Bonfiglioli set up its research department specialized in mechatronics in Rovereto (Trento). DANA is another example of multinational company present in Trentino since the ‘1990s, specialized in the automotive sector and in the development of sophisticated mechanic systems. The whole dynamic has contributed to reach a high degree of multinationalisation compared to the national average (20.8% vs. 13.1% at end of 2008).

5 Eurostat data [nama_10r_3gva], only available years 2012 and 2013. 6 Eurostat, employment by age, economic activity and NUTS 2 regions (NACE Rev. 2), [lfst_r_lfe2en2],

NACE rev.2 codes M_N: Professional, scientific and technical activities; administrative and support service activities. Trento’s employment in NACE codes M_N over total NACE activities was 10.94% in 2014, compared to 9.56% in EU28.

7 Camera di Commercio di Trento (2014) “L’industria in Provincia di Trento” http://www.tn.camcom.it/8368/pdf/Industria2014.res


The growing number of spin-offs from research supports the attractiveness of Trentino’s research system. The Province has a specific policy definition of spin-offs: a spin-off is intended as an entrepreneurial activity ‘spinning-off’ from research and that implies in its last phase a con-participation of a company interested in innovation, the participation of at least one researcher and share capital coming from the research institution for at least 20% for three years. After that period, if the spin-off delivers results, the research institute withdraws its participation. For the first three years the spin-off is hosted at the research institute’s premises.

In terms of potential to develop innovation-intensive sectors and areas such as Industry 4.0, the structural characteristics of the Trentino economy are together an advantage and a disadvantage; the small size of the companies has proven to be an impediment to the capacity to do research, due to the lack of a critical mass and to the absence of strong industrial clusters. These factors account for a generally low propensity to innovate (as indicated by the number of patent applications, see Section2.1). Nonetheless, Trento holds the record of innovative micro-enterprises by region in Italy (40.7%); the most innovative are in the manufacturing sector (42.5% vs. 30.9% in services). The latest data (2014) on the number of innovative start-ups is high (53), occupying the fourth position in Italy. The highest share of these start-ups (67.0%) work in the service sector (software, IT, research and development), while 27.0% is from the industrial sector, and a relevant part is occupied by mechatronics8 According to the latest Regional Innovation Scoreboard 2014, micro-enterprises mostly introduce product or service innovations, but less process innovation. This is an interesting trend that differentiates micro-enterprises from larger companies; where the investment in capital needed to introduce process innovation is more frequent9.

These data seem to suggest that Trentino is on a good trajectory to turn the dominance of small and micro-companies from being a disadvantage into an advantage. Trento is indeed a positive outlier when looking at the strategic dynamism of companies, both in general, and especially for micro-companies in the industrial sector. Nonetheless, Trentino is also facing some important challenges, especially when looking at international competitors working in countries with lower labour costs. Trentino, as well as the majority of the western world suffers competition from (mainly) China in sectors of key importance such as automotive10. The competitive advantage that Trentino is trying to build is based on the idea that, focusing on the hardware would never be enough to stand out in the competition with China and other fast growing economies. This is where Industry 4.0 becomes so important in building a winning response for Trentino11; the focus on software, and on how to transform “hardware in software” is going beyond informatisation and it is an area in which companies in Trentino should invest more (especially in sectors like automotive and intelligent vehicles).

In the Polo della Meccatronica there are already companies operating in the sectors of automation, control systems and optical sensors, as well as in other transversal activities of mechatronics. Among those, Centro Ducati Trento, Bonfiglioli, Rekord, Gread, BV Tech, Carl Zeiss Quality Mechanical Project. Other companies working in the mechatronics sector are: Adige-Gruppo (laser cut for sheets and pipes), Adler (components and systems for motorcycles), Cortech, Coster Technologies, Dalmec, Dana (traction systems for automotive), EnginSoft (simulation systems and modelling

8 Camera di Commercio di Trento, Op. Cit 9 European Commission (2014), Regional Innovation Scoreboard 2014 10 The most import trading partners for Trentino are Germany, France and Austria; they account for more

than half of the imports. Extra-EU partners are, as mentioned, China, Romania and Turkey. 11 This concept has been expressed in two interviews carried out with Professor Mario Zen (FBK) and

Professor Mauro Da Lio (University of Trento).


of industrial processes), EyePro System, Famatec (automated machineries for industrial handling), Fly (systems and components for energy sector, aeronautics, and aerospace), Hoist, Marangoni Meccanica (automatic systems for tier production), Metalsistem (logistics and storage management systems), Opto-I (optical sensors and production control), Pama (flexible systems of production), Sima Software and Snow Star12.

1.3!Scientific research potential Trentino excels in basic and applied research, and this is increasingly internationally recognised. Also, the inputs to maintain such a position are high. The expenditure in R&D over GDP is steeply increasing, especially since 2007, and the incidence of the expenditure over GDP ranges from 1.0% in 2003 to 1.84% in 2013. The university and the government of the Province are the two main sources for funding R&D13 and account for more than 60.0% of the total expenditure over an eight-year period. Expenditure in R&D from the Province over the total for R&D ranges between 44.3% in 2005 and 26.83% in 2012, with the lowest flection in 2008 and 2009 (24.0% on average for the two years). The expenditure in R&D from the university are also in the order of 30.0% to 20.0% for the same period, with the lowest share registered in 2009 (20.5%).

Figure 1 Expenses for R&D, total, in Million Euro, Provincia Autonoma di Trento

!Source: ISTAT

!

Considering that Trentino is a small territory, the number of active research centres and university departments is quite impressive. The main research institutes and universities are:

•! University of Trento, with 10 departments, 54 courses, more than 570 Professors and more than 16260 students,

•! Fondazione Bruno Kessler (FBK), with more than 2350 researchers,

•! Fondazione Bruno Mach, with a mission on scientific research on sectors such as agiculture, food and the environment,

12 Trentino Sviluppo – Polo della Meccatronica website 13 The other two sources being companies and non-for-profit sector

145,764

178,108

338,240 335,674

0

50000

100000

150000

200000

250000

300000

350000

400000

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013


•! Trento RISE (until 2015), association specialised in promoting knowledge economy, sustainable development and life quality standards.

The number of researchers working for companies over the total persons employed is in line with the national average and the personnel employed for R&D in full time equivalent is ever increasing since 2008 (727 persons in 2008 to 993 persons in 2013)14. While Trentino enjoys a truly international system of academic research, with more and more visiting professors and fellows from abroad, companies tend to work with local research centres. This is also a new trend since in the past companies involved in research activities had a preference for non-local research institutes15.

1.4!Role of intermediary institutions The government of the Province (“Giunta”) is the centre of the attention because of its statute of autonomy. In the context of the effort to gain international visibility and to build a culture of collaboration with international actors, the second interlocutor in terms of importance is increasingly the EU level.

Trento is categorised as a leading absorber of EU Funds in the Regional Innovation Scoreboard (2014). Trento, together with Lazio, is the only other Italian region to fall under this category. Leading absorbers are regions defined with a high participation in the FP7 Programme (above 120% of the regional average of the sample), however, this does not imply that there is a high use of Structural Funds. Nonetheless, most leading absorbers show a good performance in regional innovation and structural funds seem to play a complementary role in the regional innovation system16. A more extensive analysis of the EU funding in Trentino can be found in Section2.3.

Also when looking at businesses that have undertaken R&D activities working with public or private R&D actors, Trentino scores higher than the Italian record for 2013: 24.2% versus 20.5% as a percentage over total companies with R&D activities intra-muros17. The main instrument for incentives to innovation-related projects is Law 6/99 (the so called “Legge 6”). By Law 6/99, a company can ask for subsidies to pay for a prototype developed by the research institute. The IP rights are all given to the company, which is sometimes a disincentive for the research institutes to participate18. More on Law 6/99 can be found in Section2.3.

The role of the Italian government as an intermediary institution should also be introduced. The Ministry of Education, University and Research (MIUR) manage the funds available. The most relevant for industrial applications, innovation and technological innovation are the FNI (National Innovation Fund) and more specifically, the FAR & FIRST (funds for industrial research and experimental development), and the FIT (a special fund for technological innovation). In the context of the digital agenda and sustainable industry one can find two calls opened in 2014 from the Sustainable Development Fund (FSS), with a financial endowment of €400.0 million at national level (programming period 2014-2020).

1.5!Developing skills for the future In terms of availability of skilled human capital, the number of students at the second stage of tertiary education (ISCED classification Level 6), leading to an advanced research qualification, increased since 2007 (465 in 2007 to 577 in 2012), while the

14 ISTAT, Italian National Institute for Statistics, http://www.istat.it/en/ 15 This concept emerged during the interview with Professor Mario Zen (FBK) 16 European Commission (2014), Op. cit. 17 ISTAT, Italian National Institute of Statistics 18 The concept emerged during the interview with Professor Mauro Da Lio (University of Trento)


same statistics decreased for Italy (40,119 in 2007 vs. 34,629 in 2012)19. The number of residents in the population with a degree in science and technology was steadily increasing from 2007 until 2011, when it reached a peak of 1,558 persons20.

Also the participation rate to education and training (25 to 64 years old) is higher than the Italian rate (on average over the period 2007 to 2014, 9.4% in Trento vs. 6.4% in Italy), and pretty much in line with the EU28 average.

The development of skills and competences related to research has been in progress since the beginning of the development of the Trentino ICT strategy and in parallel with a number of projects (e.g. Trento RISE and Polo della Meccatronica). As discussed in the context of the incentives for multinational companies to establish in Trentino, one of them is the presence of a rich pool of skills in research and applied areas of mechatronics, nano- and cyber-technologies, mechanics and ICT technologies.

The share of human resources in science and technology in the active population ranges from 35.0% to 36.0%21. Trentino does not lack personnel in knowledge intensive services (where the percentage of total employment is always substantially higher than the Italian average). Nevertheless, the Province is working to improve skill availability in sectors such as high and medium-high technology manufacturing and information and communication, where it is now in line with the national value. Projects such as ProM in Polo della Meccatronica, and agencies like Trentino Sviluppo and Fondazione Kessler (FBK) are catalysers of this knowledge creation. The Polo della Meccatronica in particular aims at attracting 1500 students, and to prepare them to build an interdisciplinary view.

1.6!Major investment projects The most important investment project related to Industry 4.0 is the Polo della Meccatronica inaugurated in 2014; it will have its first laboratories functioning from September 2016. It is co-managed by the University of Trento, the Province, the Bruno Kessler Foundation (FBK) and Trentino Sviluppo. The project has planned the construction of a new building (6000 m2), next to the existing one, to host research centres, laboratories, and companies in order to create a place of exchange and knowledge integration22. It is co-funded by the European Regional Development Fund for €23.9 million, while the Province has funded the project with €17.0 million. The total cost estimated for the completion of the project is of € 60.3 million23.

The Polo has been strategically located in the southern area of Trentino (Rovereto), where the presence of the mechanical sector is particularly strong. The ProM Facility, as integral part of the project, will focus on the 3D printing revolution and its applications to cyber-manufacturing and prototyping: in fact, 3D can incorporate intelligence built into materials, and it can do this at low cost24. The Polo della Meccatronica also has a pre-incubator function for companies that would like to find a co-working space with other companies, start-ups, and entrepreneurs, with access to tailored courses to run a competitive and sustainable business.

19 Eurostat data [educ_renrlrg1] 20 ISTAT, http://www.istat.it/it/archivio/16777 21 ISPAT, Statistiche Trentino 22 Il Sole 24 Ore available at http://www.scuola24.ilsole24ore.com/art/formazione/2015-09-23/dalla-

provincia-trento-17-milioni-la-costruzione-nuovi-laboratori-destinati-studenti-175840.php?uuid=ACCylC3&refresh_ce=1

23 Available at http://www.trentinosviluppo.it/public/file/News/151211_Meccatronica_aumenta_lo_stanziamento_per_i_nuovi_laboratori_di_ricerca.pdf

24 This concept emerged during the interview with Professor Mario Zen (FBK)


Next to the Polo della Meccatronica, one can also find the Progetto Manifattura (Project Manufacturing). The companies that are eligible within this project are a maximum of two-years old, and intend to operate in eco-sustainable buildings, renewable energy and technologies. The infrastructure that is being developed for the project aims at becoming the first industrial hub for applied research in the area of renewable energies25, counting on companies (in total 46) that are a part of big industrial groups like Habitech, the Green Building Council Italia and the bio-informatics research centre Microsoft-COSBI.

Another project is TeckPeaks, which closed its applications for the second call in January 2014. The initiative is the first talent accelerator created in Italy, devised by Trento RISE with the collaboration of Trentino Sviluppo. The accelerator is dedicated to people with strong skills in ICT and willing to engage in a start-up project. TeckPeaks gives a monthly allowance of € 500-700 to its selected members (47 people for 2014), and most importantly involves them in a series of coaching programs, with national and international companies and mentors. The best teams are awarded with up to €50,000 for the development of a business plan.

Additionally, to these most recent projects there is the whole range of projects undertaken during the preceding programming phase 2007-2013. One of these is the ODT- FINODEX Project (Future Internet Open Data Expansion), to support SMEs in creating and commercialising ICT products and promoting the use of open data by involving entrepreneurs in a wider network of people interested in the subject. Other projects of the programming phase 2007-2013 are also TesLab: a model for knowledge sharing and transfer between companies, research and consumers, and ICT platforms for well-being at home, energy, smart grids, and smart building energies.

1.7!International cooperation For businesses, the most important interregional projects that Trentino is involved in relate to the European Social Fund (ESF) and include the exchange with foreign countries to improve skills and competences in sectors such as trade, tourism and construction (with, for example, the Netherlands, Belgium, Poland and Spain). More specifically on Industry 4.0 and advanced manufacturing, Trentino is also trying to build an inter-regional network thanks to the Knowledge and Innovation Communities (KICs), where it is collaborating with ASTER in Emilia Romagna and soon will be preparing a new KIC on advance manufacturing and raw materials.

In terms of research, training and mobility programs, Trento actively participated in FP7 programs between 2009 and 2013). In particular, “The Trentino programme of research, training and mobility of post-doctoral researchers”, co-funded by the European Community within the 7th research framework programme for the period 2007-2013 – amounted to €13.8 million, a considerable investment, and sign that the Province is highly interested in fostering researcher mobility and internationalising its research system26. Other areas where Trentino is involved in international projects at the European level are Smart Cities27, the Internet of things28, ICT and entrepreneurship29, and finally open data30. Extra-European, international collaboration in projects is mostly done at bilateral level. One important partner in the area of Industry 4.0 and mechatronics is Japan.

25 Available at http://www.bioecogeo.com/progetto-manifattura-entra-il-colosso-ardian-in-partnership-con-i-gruppi-tozzi-e-margherita/

26 http://cordis.europa.eu/result/rcn/155558_it.html 27 European Innovation Partnership on Smart Cities, the Systemic Standardization Approach to Empower

Smart Cities and Communities and the Electrical and Electronic Engineers (IEEE) Smart Cities initiative 28 IoT EPI (ICT 30) from UNIFY-IoT 29 STARTIFY7 Start-up summer school of ICT for young aspiring entrepreneurs 30 With the network FINODEX at the European level


Despite the high participation in international projects, Trentino’s economy is mainly local. The exports in current prices on value added in agriculture and industry are lower than in the Northeast of Italy and than the Italian average. The incidence of exports on the manufacturing sector (over GDP) is also lower than the other benchmarked aggregates. In the aftermath of the economic and financial crisis, Trento’s net imports also contracted (passing from €2.7 million in 2009 to €1.5 million in 2009), to recuperate only partially on the pre-crisis values and stabilise around €1.83 million in 2012 and 201331.

Figure 2 Exports in the manufacturing sector over GDP, at current prices, in percentage

!Source: ISPAT Statistiche Trento

The most open companies to international markets appear to be the producers of computers and electronic apparel, 63.7% are active on international markets, companies producing machineries and transports machineries (62%), as well as chemicals and pharmaceutical companies (59.9%)32.

31 ISTAT, http://www.istat.it/it/archivio/16777 32 Carmera di Commercio di Trento (2014), “L’industria in Provincia di Trento”

14% 15% 15% 15% 16% 17% 17%17%

26% 29% 28% 29% 31% 32% 33%34%

19% 20% 19% 20% 22% 23% 23% 24%

0%

10%

20%

30%

40%

1995 2000 2005 2010 2011 2012 2013 2014

Trentino Nord6Est Italia


1.8!Policy support and delivery mechanisms Considering the latest programming phase, Industry 4.0 and advanced manufacturing are included in the priorities list fir Trento. In particular, mechatronics is not only one of the key priority area of the Operational Programme 2014-2020, but also one of the best examples of the conjunction of advanced technologies in classic disciplines (like mechanics and hydraulics), with intense use of research and innovation inputs from electronics and informatics. As such, it is a core area for building the factory of the future, and it intends to improve the overall functionalities of the technical systems. Sub-sectors where mechatronics finds its applications are: industrial robotics, electronic boards, diodes and other electrical components, automotive and motor vehicles, appliances, and sensors. In Trentino, 50% of the industrial patents registered in the last years belongs to mechatronics, and 25% of the innovative start-ups too (10 in total). There are 300 companies operating in the sector, employing approximately 1100 persons33. Specialised research centres working on the subject include:

•! The University of Trento: Departments of Physics and Engineering and Master course in Mechatronics,

•! National Institute of Nuclear Physics (electronics, sensors, optics),

•! The National Research Institute (CNR): Institute of Photonics and Nanotechnology - IFN (micro - mechanical and micro - optical).

•! The Bruno Kessler Foundation - Center for Materials and Microsystems - CMM (devices, microsystems, etc.) and a project of a new technological facility for rapid 3D prototyping services printing and testing sensors and mechatronic systems for the companies,

•! Trento RISE : Catalyst for new technology research, operating until end-2015.

Trento has decided to focus on a number of areas and applications of mechatronics in its O.P. and smart specialisation strategy, with the following argumentations and objectives34:

Robotics and human-computer interaction

•! Arguments: Transversal sectors of the science and society (manufacturing, healthcare, transport, etc.), and collaboration with research groups at international level and European level.

•! Objectives: Coherence with Europe2020 strategy, ICT2014 program, with particular attention at the increase of local robotics, competitiveness of the manufacturing sector, improvement of the technological readiness and cross-fertilisation between research and businesses.

Mechatronics and microsystems

•! Arguments: string link between electronic inputs produced in Trento and priority sectors, presence of centres to develop prototypes and good connection with research groups active in the sector,

•! Objectives: increase of the technological level of the companies involved and improvement of competitiveness and efficiency.

33 Smart Specialization Strategy (2014), Trento 34 Smart Specialization Focus Group Mechatronics – February 2014 (PPT presentation) available at:

http://www.europa.provincia.tn.it/europa_2014_2020/documenti_2014_2020/- Provincia Autonoma di Trento. PROG. INNOVAZIONE, SVILUPPO ICT E ORGANIZZAZIONE/pagina16.html


Automation

•! Arguments: relevance of the subject for process and product innovation, centrality of automation as a factor of competitiveness of local, national and international companies, presence of research group at local level,

•! Objectives: improving quality, flexibility and productivity of local companies, diffusion and access to new technologies for SMEs.

Smart Materials

•! Arguments: high level of acquired knowledge in the area from local university and research centres, coherence with national and European objectives on sustainability, availability of infrastructures,

•! Objectives: improvement of materials and of the system of production (e.g. life of the products and of the plants), diversification of raw materials and lowering of energy consumption.

Sensors

•! Arguments: High-growth sector at European level, and a sector in which Trento has already developed experience both in applied research and in the development of infrastructure and facilities for its further development,

•! Objectives: improving functionality and performance of complex equipment, monitoring of the environment and reducing catastrophes risk for the territory, improving planning and resource management.

Optics: Arguments and objectives similar to Sensors.

Overall, this strategy seems to be adequate to realise a truly integrated approach, towards the growth in all the areas and sectors identified as strategic for Trentino: “agrifood”, “green and clean energy and environment”, “life quality” and “mechatronics”. As an example given in the Smart Specialisation Strategy document the introduction of sensors could stave off insects and help the elimination of insecticides and pesticides35. An advanced monitoring system for the environment could help to increase the value of the landscape and in turn attract tourism (sustainable tourism), together with improving the quality of the services and the development of smart systems for the community.

The other strategic sector to which Trentino has, for many years, devoted support is digital growth and ICT. ICT is both a sector, and a Key Enabling Technology (with reference to and in conformity with the Horizon 2020 program) and the Province has considered ICT as an ingredient for competitiveness to be driven by social innovation, especially in the last programming phase ending in 2013.

35 Smart Specialisation Strategy (2014), Trento


1.9!Good practice case Given the importance of mechatronics for Trento, the following section will report two cases of good practice in this area. Two leading companies operating in the mechatronic field established in Trentino are DANA and Bonfiglioli.

DANA

Dana is a large provider of parts and components for the automotive, commercial vehicles and off-highway sectors. It develops efficient power conveyance and energy management systems with turnover of €6.6 billion and 22,600 employees worldwide. The company has increased its investments in engineering for the fifth consecutive year (by almost 7.0% in total), reaching €176.0 million invested in this area. It counts on 15 fully integrated technology centres with more than 240 engineers36.

Dana Italia is part of the division off-highway product group37 and it has its Italian and European headquarters in Arco (Trento), where it is present since 1996. In 2015 Dana decided to invest in the project Polo della Meccatronica with the opening of the research centre Dana Mechatronic Technical Centre under the incubator of Trentino Sviluppo. The centre is the first of DANA’s centres worldwide oriented towards mechatronics, and will develop advanced traction systems for off-road vehicles. The centre will be operational from next April 2016 and it will employ 20 people, including employees and external researchers, with the prospect of getting to 28 units by 2017. The investment that the centre aims at is of approximately €2.5 million in new high machinery technology38. The agreement signed by Dana with the Province of Trento and Trentino Sviluppo also includes a commitment by the automotive corporation to a series of actions to encourage settlement in the Polo della Meccatronica of Italian and foreign companies of suppliers and park chain customers, as well as initiatives of co-marketing and technology transfer.

Dana’s objective is to pass from being a mechanical component provider to a provider of power management systems.

Figure 3 Dana Power Management Provider project

!Source: Confindustria

36 DANA Annual Report 2014 37 It designs, manufactures, assembles, and markets Spicer axles and transaxles, driveshafts and end-

fittings, transmissions, torque converters, electronic controls, and brakes 38 DANA, Ibidem


Hydromechanical Variable Transmission systems (HVT) combine the mechanical and hydrostatic travel drive to join the best features of both technologies. With HVT, Dana Rexroth Transmission Systems offers a convenient hydromechanical variable transmission for mobile machines and, by integrating the travel and working hydraulics, provides even greater potential for this advanced technology.

Figure 4 Dana-Rexroth expertise

Source: Confindustria

This type of system allows:

•! Improving fuel economy with up to 20% fuel savings in travel mode and 10% fuel saving over the entire duty cycle,

•! Increase productivity thanks to greater utilisation of throughput for the machine, fewer fuels stops and longer service intervals,

•! Reduced break wear through hydrostatic braking and reversing39.

Bonfiglioli

Bonfiglioli is an Italian multinational leader in mechanical engineering and developer of power and control systems for industrial applications, solar and wind energy. It operates since 1956 and today it has 13 production plants between Europe and Asia (China, Vietnam India, Singapore), 21 subsidiaries, a turnover of €653.9 million and 3,478 employees (2014 data)40.

Bonfiglioli’s long-term goal is to offer its customers integrated solutions and not single products. For Bonfiglioli this means merging mechanical, electric and electronic competences. To do so, Bonfiglioli decided to open an independent company in 2011,

39 Available http://www.confindustria.tn.it/confindustria/trento/istituzionale.nsf/0/8d1d7c826685de5dc1257aa30030

0753/$FILE/121025 Polo meccatronica.pdf 40 Bonfiglioli Annual Report 2014


which employs R&D experts, but also includes sales, pre-sales, and supply chain competences: this company is Bonfiglioli Mechatronics Research (BMR). BMR will work in close cooperation with the German based Bonfiglioli Vectron (where the power and control electronic department and the Bonfiglioli Innovation Centre are located).

Figure 5 Bonfiglioli’s Mechatronic Drives & Solution (MDS) Division


Bonfiglioli has stressed on research and innovation and the importance of education for the attainment of high-level results for its team of professionals. Together with Bologna and Forli, the BMR of Trento and Bonfiglioli Vectron in Germany, the company can operate with a wide ranging pull of competences.

Figure 6 Bonfiglioli’s R&D map

Source: Bonfiglioli website


The BMR of Rovereto (Trento) will mainly develop a new generation of efficient brushless motors, precision gearboxes, sensors and control devices.

Figure 7 Bonfiglioli’s energy recovery system


BMR has given a strong push to research in mechatronics for automated solutions for industry, and it has a highly positive impact on Trentino’s economy: the company employs 30 between engineers and technicians, most of them are native of Trento, and investments for the period 2013-2015 were planned to be approximately €3.0 million41. Thanks to the patent fund (Fondo Brevetti) managed by Trentino Sviluppo, all inventions and patents obtained with support from the public authority of the Province will be used for the benefit of the territory.

1.10!Leveraging the existing potential Many steps have been taken by the Province to make the area of advanced manufacturing, and Industry 4.0, the flagship of its innovation strategy. Nevertheless, some important challenges have been identified, that could hinder the realisation of the expected results:

•! Challenge 1: Dependency on the local government as a source of funding

Public resources for R&D are shrinking in recent years due to the economic and financial crisis. The relatively low financing of R&D from private sources is a characteristic of the Province. Despite the fact that the mechatronic sector has seen the establishment of mechatronics research centres as part of big multinationals (e.g. Bonfiglioli, DANA), it is important that Trentino leverages on Industry 4.0 and on the cases just mentioned to create a positive climate for the involvement of the private sector in the funding of research.

•! Challenge 2: Improve technological transfer

The second challenge is linked to the need for more technological transfer between the university, the research institutes, and businesses. For Industry 4.0, the ongoing projects are tackling this specific aspect, with investments in new laboratories and open spaces to host companies, researchers and businessman and allow them to work

41 https://www.ufficiostampa.provincia.tn.it/Comunicati/Bonfiglioli-ha-scelto-in-Trentino-la-nuova-unita-di-business-Mechatronic-Drives-and-Solutions and http://www.ladigetto.it/permalink/4101.html


together. However, the full realisation of this potential is not yet observable, and it will take at least another couple of years to assess its success/failure.

•! Challenge 3: Building industrial clusters in a territory dominated by SMEs

A third challenge is linked with an economy dominated by SMEs and the absence of well-rooted industrial clusters. The Polo della Meccatronica and other projects such as Progetto Manifattura are trying to include SMEs in newly formed clusters around Industry 4.0. The biggest challenge will then be for these SMEs to succeed in being truly involved and stand competition with international players, often working at lower labour costs. On the positive side, if successful, the Industry 4.0 revolution should be able to surpass labour costs as a determinant factor for competing in the international scene, thanks to the development of hardware that operate as software, (as in the case of multifunctional 3D printing or intelligent vehicles).


2.!Regional Innovation Performance Trends, Governance and Instruments

2.1!Recent trends in innovation performance and identified challenges The strategic choice to focus on innovation, technology and research came from the need to stimulate the development of an economically depressed area back in the 1980s- 1990s. in light of this, Trentino decided to invested extensively in R&D and in the development of an ICT cluster. Together with ICTs Trento has built a competence triangle that also embeds agro-food and tourism. This, in turn, has prompted lead markets in sectors such as e-Health, mechanics, sustainable constructions but also neuroscience, nanotechnology, and genomics, to name some.

In terms of inputs to the research and innovation system, the total intramural expenditure in R&D (GERD) as a percentage of GDP for the last four years (2011-2014) is slightly below the European average (1.8% vs. 2.0%) but higher than the Italian one (1.3%)42.

Figure 8, Total intramural R&D expenditure (GERD) by sectors of performance, as percentage of GDP

Source: Eurostat

The government expenditure in R&D as a share of total GERD in the same period is always higher than the European average (a positive difference of approximately 14.5% points). 2014 saw a decrease of the allocated resources to research and university by the government of the Province (€ 249.0 million in 2014; -6.5% compared to 2013)43. The business sector expenditure as a share of total GERD is lower than the European average (46.45% versus a European average of 63.0%), confirming a long-term trend in Trentino. However, it must be noted that, since 2009, smoothed by the reform of

42 Available at: http://ec.europa.eu/eurostat/web/science-technology-innovation/data/database and http://ec.europa.eu/eurostat/web/regions/data/database?p_p_id=NavTreeportletprod_WAR_NavTreeportletprod_INSTANCE_BQqmHeCfV1BE&p_p_lifecycle=0&p_p_state=normal&p_p_mode=view&p_p_col_id=column-2&p_p_col_count=1

43 Eurostat, Total intramural R&D expenditure (GERD) by sectors of performance [rd_e_gerdtot]

1.93% 1.97% 2.01% 2.03%

1.22% 1.21% 1.27%1.31%

1.86% 1.73% 1.81%1.84%

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

2010 2011 2012 2013

European5Union5 Italy Provincia5Autonoma5di5Trento


the research system in Trento, the private sector started to play a role in the economy, especially through public-private partnerships44.

In terms of factors enabling the diffusion and uptake of innovation, total R&D personnel as a percentage of total employment is higher than the EU28 and definitely one of the highest in Italy: it was 2.58% in 2013, compared to 1.93% for the EU28. The importance of the research sector is also supported by an ever-increasing number of researcher in the last ten years: 2897 in 2013, way above the Italian average and braking even with the EU28 one45. The employment in sectors linked to innovation activities is in line with the EU28 in terms of shares over total employment, more in detail, employment in knowledge intensive services is slightly growing from 2008 until 2013, passing from 37.0% to 39.0% in 2013 while the shares of employment in professional, scientific and technical activities are rather stable, around 5.0% in the same period.

The number of EPO patent applications per million inhabitants displays some variation during the last ten years (there were 82.5 per million inhabitants in 2011 and the latest available year, 2012, reports a provisional 33.7). Taking the EU28 as a benchmark (EU28=100), Trento patent applications are around 51.5% of the EU28 average for the same indicator and period. The number of patent applications to the EPO by selected technology for the last ten years until 2012 show an overall predominance of ICT patents (i.e. consumer electronics, computers and office machineries and telecommunications) over high-tech ones (i.e. aviation, computer and automated business equipment, communication technology, laser, micro-organisms and semiconductors). Nevertheless, EPO patent applications in RIS are lower than for the majority of other Italian regions (score 0.21, approaching the scores of southern regions and Valle D’Aosta), suggesting that improvements can still happen in this area.

Figure 9 Propensity to patent, number of patents registered over number of residents (* 1,000,000)

Year Autonomous Province of Trento

Northeast of Italy

Italy EU27 Eurozone

1990 n.a n.a. 39.5 57.3 73.3

1995 31.7 73.3 43.6 65.3 82.1

2000 67.8 122.1 70.4 107.1 134.5

2005 62.2 150.0 83.5 114.8 145.7

2007 66.7 150.9 81.7 114.8 144.3

2008 58,1 137.6 80.5 115.5 144.7

2009 63.6 112.9 74.4 115.8 144.5

2010 61.3 84.3 75.2 n.a. n.a.

2011 80.3 n.a. 62.2 n.a. n.a. Source: Camera di Commercio Trento

44 Available at: http://www.statistica.provincia.tn.it/binary/pat_statistica_new/ricerca_sviluppo_innovazione/RicercaTrentino_2000_2011.1403166444.pdf

45 Eurostat, Total R&D personnel and researchers by sectors of performance, sex and NUTS 2 regions [rd_p_persreg]


Figure 10 Number of patent applications to the EPO by priority years for selected technologies in Trento

Source: Eurostat data

Following the last Regional Innovation Scoreboard (2014), SMEs innovating in-house as a percentage of all SMEs is in line with the EU28 average, and scores 0.44 in the normalised database within a 0 –lowest to 1- highest score, occupying the seventh position among the Italian regions. Trentino also scores well in the innovative SMEs collaboration index (0.2 in the normalised score), only surpassed by three other regions in Italy, however lower than the EU28 average46

Although the propensity to innovate (as indicated by the number of patent applications) is one of the few negative notes for the innovation economy in Trento, the number of innovative start-ups is high (53), occupying the fourth position in Italy47. The highest share of these enterprises (67.0%) work in the service sector (software, IT, research and development), while 27.0% belongs to the industrial sector, a relevant part of which is occupied by mechatronics.

2.2!Institutional framework and set-up Trentino, as other Italian territories, has a history of autonomy dating back to 1946, and signed with the constitutional law of 26 February 1948. After the Constitutional Reform 0f 2011, also the ordinary status regions increased the respective competences, and currently all regions have legislative power in policy areas concerned with the regional development. Nonetheless, it can be said that the government of the Province has still a stronger autonomy than ordinary statute regions and territories, and it exerts public functions that normally belong to the Italian central government48.

By the Law n. 191/2009 concerning applied research and university, Trento has full autonomy in designing and implementing aid schemes, infrastructures, education and training. It also has full autonomy in the design and implementation of enterprise, technology and innovation policies. This is an important distinctive characteristic of Trentino’s system. Trentino’s innovation model is distinguishable on the basis of the

46 European Commission (2014), Op. cit. 47 Camera di Commercio di Trento (2014), Op. cit 48 Technopolis, UNU-Merit, Fraunhofer ISI (2012), Regional Innovation Monitor Report Trento

3.0

1.0

6.5

2.2

4.8

1.1

7.3

2.33.1

0.1

5.1

2.0

6.5

2.2

5.4

3.2

12.0

4.3 4.5

1.1

2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

High!tech!6 total Information!and!communication!technology!(ICT)!6 total


central role played by the university, the research centres and the overall education system.

Figure 11 Trentino’s research and innovation system

Source: own elaboration from Autonomous Province of Trento

Mainly because of very low starting levels, of investments in research and innovation, the funding of innovation by the public authority has been central since the acquisition of the autonomy and even more in the 1980s/1990s, given the need to address the under-development of the innovation system and low levels of industrialisation, and through the 2000s’ (especially after the financial crisis), to support and sustain growth. The innovation system is one of the fundamental axis on which the Province has developed its autonomy49. The system of business incentives for companies of the Province is one of the most structured and active of Italy and Europe, especially thanks to Law6/99 (see Section2.3) and to the development of public and semi-public research entities.

Given this, the innovation capacity potential can be considered to be high, nonetheless, an increased inter-operability and inter-connectivity between publicly funded and autonomous entities operating in the territory could be targeted to support high-tech sectors and to increase internationalisation and employment in the Province. In support of this need, starting from 2005, the Province has initiated a structural reform of the research and innovation system in order to better link the world of education, research and enterprise. Since 2011 the main investments have been addressed to the sectors with the highest productivity (ICT, energy and sustainable constructions). The new government (2013 until present) is willing to invest more in social innovation, with more attention given to territorial identity and to address social disparities.

49 DG Competition (2012) consultation, Disciplina per gli aiuti di Stato a ricerca, sviluppo e innovazione

Province of

Trento University of Trento

Accelerators, incubators,

local laboratories

CitizensBusinesses

and associations

Research and

innovation centres

Clusters

Research and

innovation entities

Societal system

Public R&D system Private R&D system


The ministries (in Trento ‘councillors’) responsible for the various policy areas are elected by the President of the province (also head of the government, called “Giunta”). There are four main departments in the government responsible for research:

•! The Directorate General (“Direzione Generale”) for programming and coordination of innovation and the ICT area,

•! The Department of knowledge (“Conoscenza”) and in particular the Service for Research and University,

•! The Department for university and research, youth policies, equal opportunities and cooperation for development, and finally,

•! The Department for economic development and labour with the Agency for Aid for the Economic Activity (“Agenzia Provinciale per l’Incentivazione delle Attività Economiche” –APIAE-), for the promotion and concession of financial aid and funding for enterprises.

Other entities of the Province that are involved in coordinating the Trentino’s enterprise and innovation system are:

•! Trentino Sviluppo (to spur innovation capacity and entrepreneurship in companies operating on the territory),

•! Trentino Network (focused on telecommunication networks operating in Trentino) and

•! Informatica Trentina (for the development of ICT skills and for the management of the information system).

In addition, actors that play an essential role to guarantee the functioning of the “Trentino as a hub” innovation system, these are:

•! The University of Trento (16,260 students, 180 post-doctoral researchers and 570 professors and researchers),

•! The Bruno Kessler Foundation, born in 2007 and counting on 7 research centres, 350 researchers and 220 PhD students and visiting professors,

•! The Edmund Mach Foundation, that dedicates its activities in research, education and training and consultancy services to enterprises, with 350 full-time employees and three research centres.

Trento RISE, operating until end of 2015, was core partner in the Italian node of the European Institute of Technology (EIT) ICT Labs network, established in 2009 from the University of Trento and the Fondazione Bruno Kessler. It worked in collaboration with other hubs of the network (Berlin, Paris, Helsinki, Eindhoven and Stockholm) and with other Italian partners (e.g. the Fiat research centre and Bologna University). The EIT is currently financing three Knowledge and Innovation Communities (KICs), launched in 2009 and active since 2010: EIT ICT lab, Climate KIC, and KIC InnoEnergy. Trento is also currently competing for the KIC on “Healthy Living and Active Ageing” and it is building a consortium for the “raw materials” KIC.

Starting from the structural reform of the research and innovation system initiated in 2005, in order to encourage technology transfer Trentino can now count on:

•! Six Business Innovation Centres managed by Trentino Sviluppo offering facilities and specialist services to start-ups (in 2012 they hosted 86 companies),

•! The accelerator TechPeaks started in 2013 and managed by Trento RISE and Trentino Sviluppo for support of companies in the field of the ICTs (18 start-ups were starting their activities at the end of the first phase of the program),


•! And the European Centre for Enterprise and Innovation (“Centro Europeo Impresa e Innovazione” - CEII); the oldest business innovation centre (1998) with the specific objective of supporting micro- and small artisans and entrepreneurs50.

Excellence private research centers are also actively operating in Trento, these are, to name some, the COSBI (Microsoft Research University of Trento Centre), FIAT Research Centre, Trento Ducati Research Centre, Bonfiglioli Mechatronic Research, Create-Net (Centre for Research and Telecommunication Experiment for Networked communities) and Graphitech (Centre for Advanced Computer Graphics Technologies).

Given the autonomy, it is not realistic to expect that the role played by the Province as funding and managing authority of the innovation system will (or should) diminish, however, reforms such as the one of the research and innovation system are giving signals of being successful for the consolidation of the inter-operability of the entities working in the territory, and for the increase of technology and knowledge transfer, also outside of the university, and towards SMEs.

2.3!Regional innovation policy mix In order to understand the local framework for innovation policy, one must refer to two specific but comprehensive normative references that frame innovation and research support and incentives in the Province: The Provincial Law of the 2 August 2005, n.14 and the Law 6/99 (then modified by Law of the 1 August 2011, n.12).

The Provincial Law 14/2005 reorganised the overall system of research in Trento and the role of the Province in supporting it. The main instrument for programme intervention in the research field is the Multiannual Research Program (PPR). The Law also set up a unique research fund; recipients are defined to be the University of Trento, the Foundations of Bruno Kessler and Edmund Mach, the enterprises ,and the provincial organisations and other institutions carrying out research in the province of Trento51. The Law is recognised as one of the most important elements to maintain a fertile ground for research in Trentino.

Law 6/99, and its revised version (2011), is the most cited reference of the Province that contains the modalities for companies to receive subsidies and incentives to do applied research, to establish temporary research contracts and to employ researchers in a company. The incentives can be accessed by companies fully established in Trentino, as well as by companies, which are not headquartered on the territory, but have at least a production plant in Trentino. Support measures are also foreseen for research centres as operative units of the companies, with the objective of assisting the knowledge and human capital transfer from public entities to private ones. The maximum amount to be granted by project is €3.0 million, in case of concordance between the project and the objectives of the PPR, the support can be increased52.

In terms of the more general policy framework for R&D and extra-local instruments, Trento has defined a limited number of objectives as investment priorities for the ERDF funding period 2014-2020: the total allocated resources for “strengthening the research, technological development and innovation” cover the largest part of the resources to be allocated (50.5%) and focuses on the improvement of the infrastructural system for research, as well as on technology transfer between the world of research and companies. Allocated funds for “improving SMEs’ competitiveness” are 25.5%, while “transition to a low-carbon economy” takes 20.0% of the resources. At the end of 2014 there were more than 6,000 co-financed projects by ESF, with an overall value of €382.0 million (including public financing plus ESF).

50 Provincia Autonoma di Trento (2014), Strategia di Specializzazione Intelligente, Trento 51 Available at: http://www.uniricerca.provincia.tn.it/leggi_regolamenti/pagina1.html 52 Available at: http://www.uniricerca.provincia.tn.it/leggi_regolamenti/pagina1.html


In addition, Trento has already invested in important initiatives for the “improvement of access and use of ICTs”, and in total €35.0 million have been allocated to the fulfilment of the Digital Agenda EU2020.

For the new programming cycle, 2014-2020, Italy has allocated around €32.2 billion for Cohesion Policies (ERDF, ESF). 57.7% of the ERDF expenditure should be allocated to research and innovation, ICT, competitiveness of enterprises and low carbon economy53. Resources given to the Province of Trento are budgeted to be €108.6 million, (of which total EU contribution of €54.3 million). Research and innovation weights for approximately 50.0% (which is sensitively higher than the neighbor province Bolzano, with approximately 1/3 of all ESF).

The Seed Money fund supports the creation of new innovative enterprises. Eligible expenditure includes: cost of market analysis, feasibility studies, entrepreneurial training, IPR registration, business set up etc. Each start-up can receive a maximum of €15,000. The total budget allocated to this initiative amounts to €8.06 million. The aim is to promote social inclusion and economic growth through the support of innovative businesses, with a preference given to the ones managed by young women. Trentino Sviluppo is the management authority and co-financer (30.0%), it has launched three calls, one in 2009, one in 2011 and in 2013. The rest of the financing is provided by the EU (30.0%) and by the Italian central government (40.0%). In 2009 there were 23 projects financed, for a total of €2.17 million (the Province decide to double the contribution due to strong interest). In 2011, 40 projects were financed, receiving €4.5 million. The certified expenses (“spesa certificata”) was 91.5%, compared to an average of 78.3% of regional programmed operational programs with objective “competitiveness”.

The main policy documents including the most recent guidelines followed by the Province are:

•! The Smart Specialisation Strategy (2014) that illustrates the province’s strategy for research and innovation and smart specialisation (RIS3), in line with the objectives of the Europe2020 strategy, the “Innovation Union” initiative, the 2010 Communication on “Regional policies contributing to Smart Growth in Europe” and the Structural Funds for 2014-2020 and Cohesion Policy regulations54.

•! The ERDF O.P. in the context of the objective “investments in favour of growth and employment” (“Programma operativo nell’ambito dell’obiettivo “Investimenti in Favore della crescita e dell’occupazione””) for the period 2014-202055,

•! The Provincial Development Program for the XV legislature (published in 2014)56,

•! The multi-annual research program for the XV legislature (Programma Pluruiennale della Ricerca –PPR)57.

According to the OpenCoesione website, projects in Research and Innovation from 2007 until 2015 are 175. The biggest in terms of funds received is “Progetto Manifattura” (Project Manufacture), which is a large-scale project for building

53 see http://ec.europa.eu/contracts_grants/pa/partnership-agreement-italy-summary_en.pdf 54 Available at:

http://www.europa.provincia.tn.it/binary/pat_puntoeuropa/documentazione_preparatoria_2014_2020/Strategia_di_Smart_Specialisation_PAT_All._Del._G.p._1053_dd30giu2014.1404821904.pdf

55 Available at: http://www.europa.provincia.tn.it/binary/pat_puntoeuropa/fondo_fesr/FESR_2014_2020_P.O._approvato_CE_Dec._905_2015.1429182826.pdf

56 Available at: http://www.giunta.provincia.tn.it/binary/pat_giunta_09/XV_legislatura/PSP_22_dicembre.1419325355.pdf

57 Available at: http://www.uniricerca.provincia.tn.it/binary/pat_uniricerca/news/Programma_pluriennale_ricerca_XV_legislatura.1437982498.pdf


infrastructures to improve technology transfer and network development in the area of research and innovation58. It has started in December 2015 and it is due to last almost three years (2018). To this, it must be added the Polo della Meccatronica, extensively treated in Section1.6.

The table below reports some of the most relevant innovation support measures in Trentino, focusing mainly on the years 2013-2020 and reporting on Cohesion funded initiatives for SMEs, technological development and innovation, Seed Money and sectoral-specific projects such as Project Manufacturing and Polo della Meccatronica. Open Data (2012-2016) in Trentino and the Start-up fund TechPeak (2013-2014) are also reported because of their strategic importance for the Province.

58 http://www.opencoesione.gov.it/, it is a website of the Ministry for economic development and cohesion in Italy. It includes a review on the implementation of all projects financed by cohesion policies in Italy.


Table 1 Regional innovation support measures

Title Duration Policy priorities Budget

Organisation responsible

More information

ODT – Open Data in Trentino

2012-2016 5.4 Innovation management and advisory services

6.1 User-driven innovation initiatives

7.1 Public sector innovation initiatives

n.a. Principal Administration supported by: Informatica Trentina and Trento RISE until 2015.

http://www.innovazione.provincia.tn.it/opendata

http://www.innovazione.provincia.tn.it/binary/pat_innovazione/eventi/20140129_2_Il_progetto_Open_Data_del_Trentino.1391085553.pdf

Strengthen research, technological development and innovation

2013-2020 1.1 Institutional R&D funding

4. Business R&D and innovation

5. Innovation climate and business eco-system

ERDF Funds, €27,438,479

(50,5% from the EU)

Principal Administration

http://www.europa.provincia.tn.it/binary/pat_puntoeuropa/fondo_fesr/FESR_2014_2020_P.O._approvato_CE_Dec._905_2015.1429182826.pdf

Promote SMEs competitiveness and Agriculture

2013-2020 5.1 Cluster development

5.3 Innovation awareness rising

4.2 Organisational , process, and other non-R&D innovation

ERDF Funds, €13,855,182

(25,5% from the EU)

Principal Administration http://www.europa.provincia.tn.it/binary/pat_puntoeuropa/fondo_fesr/FESR_2014_2020_P.O._approvato_CE_Dec._905_2015.1429182826.pdf




More information

Green and low carbon economy

2013-2020 5 Innovation climate and business eco-system (in particular 5.2 Science – technology parks and incubators)

2.4 Demonstration projects, proto-types and proofs of concepts

ERDF Funds €10,867,024

(20% from the EU)

ERDF Funds, Principal Administration

http://www.europa.provincia.tn.it/binary/pat_puntoeuropa/fondo_fesr/FESR_2014_2020_P.O._approvato_CE_Dec._905_2015.1429182826.pdf

Seed Money 2013-2020 1.1 Institutional R&D finding

5.5 Seed and early-stage capital vehicles, business angel networks

Max. funding allocation €150,000

ERDF and Province (Trentino Sviluppo and Principal Administration)

Start-up Fund (TechPeak)

2013-2014 (possible future editions)

4.3 Fostering start-ups and gazelles

Financing five projects for max. €50,000 per project plus monthly allowance for participants of approx. €500 – 700.

Principal Administration, Trento RISE, EIT ICT Labs and Trentino Sviluppo

http://www.trentinosviluppo.it/en/Principale/Become_an_entrepreneur/Tools/TechPeaks/TechPeaks.aspx




More information

Polo Meccatronica (Rovereto)

and

Progetto Manifattura (Rovereto)

2015-2018 1.1 Institutional R&D funding

2.1 R&D cooperation between academy and industry

2.3 Knowledge transfer structure between academy and industry

3.2 Training and life-long learning of researchers and any other personnel involved in innovation

4. Business R&D innovation

5.2 Science technology parks and incubators

Cohesion Funds 2007-2013, €48,522,151

€17,000,000 from the government of the Province for Polo della Meccatronica

Progetto Manifattura: €48,000,000 (Fondo sviluppo e coesione – national fund for cohesion and development)

Principal Administration and Trentino Sviluppo

http://www.opencoesione.gov.it/territori/province/trento-provincia/

http://www.regioni.it/dalleregioni/2014/10/27/trento-progetto-manifattura-via-libera-ai-fondi-statali-del-pap-371444/

Source: own assessment


2.4!Appraisal of regional innovation policies In the context of scientific research and Law 14/200559 that has reorganised the Trentino research system, the Technical-Scientific Committee for Research and the Research Evaluation Committee have been recognised as the two main bodies operating as evaluators. While the first gives a view on the presented projects, the second “evaluates the efficiency of the provincial interventions, in connection with the goals fixed in the Multiannual Research Program and with the outcome of the financed projects”60.

Regional evaluation on research and innovation, especially in the context of European Structural Funds and on the main funding instruments is slowly improving in Italy, and especially in the last programming phase (2007-2013) a significant increase in the total number of evaluations was observed. Nonetheless, the majority of the regional evaluations, also in the case of Trento, are thematic evaluations of the programme(s) and does not consider the programme in its full complexity. A better helicopter view on the overall programs is only provided in ex-ante evaluations of the O.P.s or in the actual documents for the programming phases. In the document on the Smart Specialisation Strategy and the O.P. for 2014-2020, the rationale behind the selection of the above objectives is thoroughly explained, as well as the scheme for monitoring and subsequent evaluations is explained. The Province has already started a process of monitoring and evaluation in four steps:

1.! The definition of a limited number of indicators for the monitoring of the objectives and priorities,

2.! The implementation of a system in line with the territorial baseline and the targets to reach,

3.! The periodic monitoring of relevant indicators,

4.! The periodic review of the objectives and if necessary of the same indicators.

The analysis of the key areas of research and technologies done during the XIV legislature was taken as a reference for framing the current priorities and instruments for research and innovation in Trentino. The key areas identified during the XIV legislature were: the management of natural resources and sustainable production, the biotechnologies, computational biology and genomic, material sciences and ICTs. The framework for Key Enabling Technologies (KETs) of the European Union further identified the following as important KETs for Trento: advance materials, industrial biotechnologies, and photonics and advanced manufacturing.

Most recently (2014) the following four priority areas for the development of Trentino have been identified: agro-food, life quality, energy and environment, and mechatronics. The lines of actions identified in line with these priorities respond to the following objectives, as clearly set-out in the Smart Specialisation Strategy of June 2014:

•! Strengthening the research and social innovation ecosystem,

•! Promote the innovation potential of the local economic system,

•! Support the development of new initiatives linked with entrepreneurship and innovation,

•! Strengthen the role of the Public institutions as indirect generator of innovation,

59 See Section 2.2 of this Report 60 Provincia Autonoma di Trento –Uniricerca, available at:

http://www.uniricerca.provincia.tn.it/leggi_regolamenti/pagina1-082-10229.html


•! Put a value on human capital.

Despite the areas identified during the XIV legislature and the ones identified in 2014 can be seen as a follow-up of each other, in the previous period there was a stronger focus on ICTs, while the current period (2014) includes mechatronics and life quality instead. ICTs are still in the Agenda, but they occupy now a transversal role; this can be seen as a sign of the successful implementation of the actions taken up to 2013 for ICTs.

Compared to other Italian regions, Trentino reports a quite extensive list of evaluations carried out, or in progress, for the programming phases from 2000 onward (at least 14 counted until 2012)61. Already with respect to the programming phase 2006-200862, the agreements signed between 2010-201363 determine a more open and coordinated actions of planning with the Foundations (FBK and Edmund Marsh). Tighter evaluation and monitoring mechanisms have also been established, with mandatory annual reports from each research entity, and the goal to have a fully functioning research information system at the level of the Province64.

For the programming phase completed in 2013, all evaluations should have been received in 2015. Despite the evaluations are not of easy access, some documents could be found. In particular, the evaluation document on the coherence of the O.P. 2007-2013, for the years 2008-2010, with respect to the strategic priorities at Provincial level for the ERDF, ESF and CF65 concludes that the implementation of the O.P. was distanced from the objectives that were identified in the pre-actuation phase. The main reason seems to be the economic crisis, that has affected Trentino’s economy since 2008, but also the complex system of management of the O.P. (divided between the Province and other two intermediaries for services implementation). The positive remark made in the evaluation document is that, despite the distance between objectives and implementation, the intervention was timely (also taking into account the anti-crisis measures) and the quality of the services provided was high.

A final thematic evaluation for the objective 2 (competitiveness and employment) of the period 2007-2013 could also be identified, together with an additional evaluation for objectives related to environmental research and environmental efficiency66. The evaluation for these two objective reports overall positive results in terms of coherence, impact of the investments made in environmental efficiency (however limited compared to the total), but no evidence with respect to the impact of the investments towards growth of renewable energies in the private sector. As previously mentioned, greater impact on the private sector is one of the research and innovation needs of the Trentino’s system. Other evaluations for the O.P.s from 2007 until 2013 concern, among others, the areas of education and life learning67 and areas such as

61 Ministero del Lavoro e delle Politiche Sociali, SNV, ISFOL (2012) “Le Valutazioni del FSE 2007-2013” 62 The XIII legislature corresponds to the years 2003-2008 63 The XIV legislature corresponds to the years 2008-2013 64 DG Competition (2012), Consultation document, Disciplina per gli aiuti di Stato a ricerca, sviluppo e innovazione

Documento di consultazione 65 The European Regional Development Fund (ERDF), the European Social Fund (ESF) and the Cohesion Find

(CF). The reference document can be found at Dipartimento del Tesoro http://www.dps.tesoro.it/documentazione/snv/piani_valutazione/trento/Valutazione della coerenza dell attuazione del PO FSE 20072013 Trento.pdf

66 CODEX –Agenzia dello Sviluppo (2014) “Attività di valutazione ongoing con riferimento all’Asse 1 “Energia/Ambiente e Distretto Tecnologico del Programma Operativo del Fondo Europeo di Sviluppo Regionale (FESR) 2007-2013 della Provincia Autonoma di Trento” http://www.europa.provincia.tn.it/binary/pat_puntoeuropa/programma_2007_2013/FESR_2007_2013_Rap_fin_val_CODEX_ob.op.1_2.1417688897.pdf

67 Provincia Autonoma di Trento (2015) “Verifica comparativa di costo e di efficacia delle attività formative a cofinanziamento del programma operative Fse 2007/2013 e delle altre strutture della Provincia di Trento” http://www.fse.provincia.tn.it/binary/pat_fse/valutazione_14_20/PUV_approvato_dicembre_2015.1454421619.pdf


rural development68 Not much could easily be found on the specific objectives of biotechnologies, computational biology and genomic, material sciences and ICT.

2.5!Policy good practice One of the most important priority areas over which Trentino has broadly invested is digitalisation and the ICT. The policy good practice that is proposed in this section is related to ICT, and more specifically to the realisation of a single data centre (Data Centre Unico Territoriale - DCTU).

The project for a single data centre has the objective of rationalising infrastructure and promoting the provision of services at a low energy consumption (Green ICT), while using cloud computing. The project has been given the approval in 2012. As part of the consortium working on this project one can find, apart from the Province (Provincia Autonoma di Trento), also the Consortium of local entities of Trentino (Consorzio dei Comuni Trentini), the Local Agency for Health Services A.P.S.S., The University of Trento, Trento RISE, Fondazione Bruno Kessler (FBK), Fondazione Edmund Mach, Informatica Trentina. Three are the objectives of this program:

Improve reliability of the telematics services of the public administration,

Diminish the costs and impacts linked to the management of the existing data centres,

Create an excellence centre in which services can be also accessible to private companies.

Figure 12 Single Data Centre Trento – structure and objectives

Source: Provincia Autonoma di Trento

The DCTU aims to create synergies between private and public actors, because it supports at large the technological infrastructure with the possibility of function as a provider of both public and private services. Among those, it can serve as a basis for the realisation of the Digital Archival Centre of the Province, as well as Community Cloud operator for computing and storing data in digital form.

68 AGER and STARTER consulting (2010) interim report, http://www.dps.tesoro.it/documentazione/snv/piani_valutazione/trento/Valutazione_intermedia_PSR_Trento_2010.pdf

Improve reliability of the telematics services of the public administration

1 2

3

In participation with :► Autorities and actors that are responsible today of the

management of the existing data centres, as propellers ableto give their knowledge and support given their specificknowledge of the subject.

► Private Companies able to put together new technologiesand the speficificties of the territory, realising a competitivedata centre.

Diminish the costs and impacts linked to the management of the existing data centres

Create an excellence centre in which services can be also accessible to private companies

DCUT


Similar international and national initiatives taken as models of reference by the Province are illustrated in the Figure below.

Figure 13 National and international initiatives taken as example for the Single Data Centre


The project roadmap as of March 2014 is reported in the Figure below.

Figure 14 Single Data Centre roadmap


2.6!Possible future orientations and opportunities Although Trentino can be regarded as a reference with respect to basic and applied research in sectors such as mechatronics, smart systems, and ICT, Trentino’s aspiration to be internationally recognised as a pioneer of the ‘new industrial revolution’ requires a constant effort to equip its economy and society to reach this

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goal, and to maintain a position in the high ranks. Among the actions to be taken as orientation for the future, one can mention:

Strengthening of private sector investments in R&D to foster transfer between research and industry

As reflected by the statistics, the contribution of the private sector to fund R&D is relatively low in Trentino. The explanation must be found in the special role historically played by the local government because of the autonomous statute that the Province possesses. This also provides an explanation (at least in part) for the focus that Trentino has been given to basic and applied scientific research (in Italy traditionally funded by the public authority). As a consequence of this specialisation and focus, there is room for Trentino to improve its ability to deliver results in other innovation phases, like commercialisation and diffusion. This is also important in the view of building a stronger system of transfer between research and industry.

Although the existence of such well functioning and strong public support schemes in Trentino constitute one of strongest elements of attraction for researchers and companies, it is important that Trentino finds a way to differentiate its sources of funding for R&D, to find a balance between how public and private can be used as a lever to further stimulate industrial development.

Improving research capacity in different sectors also leveraging on traditional sectors to do research

As mentioned in this report, Trentino counts on some niche but strong sectors (e.g. production of hiking shoes, or bio products and agro-food). While the focus on ICTs is long-lived in the programming priorities of Trentino, it will be interesting to see the results of the new O.P. 2014-2020, which identifies agro-food, environment and energy, mechatronics and life quality as four interdependent and interactive priorities. If well implemented, the program will possibly succeed in involving traditional sectors under the perspective of exploiting their innovative potential, and show that Trentino was able to “think bigger” and trigger an overarching smart specialisation strategy for growth.

Needless to say, this is an ambitious goal, in the first place because, as also reported in the smart specialisation strategy document (2014), the macroeconomic conjuncture is not favourable. However less hit by the economic crisis, Trentino feels the effects of high Italian fiscal pressure (especially for companies who wish to operate in the territory), and a general contraction of public resources for research and innovation. These are the greatest challenges to be faced in the implementation of Trentino’s smart specialisation strategy, toward 2020.

Building clusters around SMEs to improve the visibility of innovation champions at international level and to increase trade openness

The last challenge identified is linked with Trentino’s orography (70% of the territory is over 10000 metre altitude). Trentino has a limited area to be dedicated to production and urban settlement. These characteristics are also at the basis of the industrial structure of Trentino, which is dominated by SMEs. Despite the innovation performance and the dynamism of many of these SMEs is relatively high, Trentino can work more to improve the visibility of its ‘champions’: one way is to build clusters around them, in order to increase their capacity to face international competition, and also to increase trade openness (propensity to export). This is important to avoid the isolation of Trentino’s system, and to involve SMEs in the systemic changes that are needed to survive in an increasingly interconnected world.

Overall, the smart specialisation strategy and the O.P. for 2014-2020 recognise these challenges and provide justifications for focusing efforts on the four areas of agro-food, mechatronics, life quality and energy and environment. There is, in addition, an acknowledgment that these areas go beyond vertically-thematic areas, and rather contain transversal elements to leverage on; in the specific, social cohesion, social


innovation and the use of ICT as enabler technologies to improve the performance of the priority areas.

Balancing internationalisation with the risk of brain drain

The international mobility of researcher is one of the most important attractions of the Trentino research system. However, it also encourages international mobility of local researcher towards other European and extra-European countries (the so called brain drain). In its smart specialisation strategy, Trentino intends to dedicate much attention to the creation of a renewed local identity through social participation and social innovation. This is also done in order for Trentino to retain its human capital. The challenge in this context will be the ability to create the conditions for local researchers ‘to stay at home’.


Appendix A!Bibliography

1.! Banque de France (2015) Les entreprises en Pays de la Loire, Bilan 2014 – Perspectives 2015. Available at: https://www.banque-france.fr/economie-et-statistiques/conjoncture-et-croissance/publications-regionales/publications/pays-de-la-loire.html

2.! Conseil Régional des Pays de la Loire (2011) Le Schéma régional de l'économie et de l'emploi durables (2011-2016)

3.! Conseil Régional des Pays de la Loire (2014), Stratégie régionale d'innovation pour une spécialisation intelligente (SRI-SI). Available at: http://www.paysdelaloire.fr/politiques-regionales/economie/

4.! Conseil Régional des Pays de la Loire (2015), Contrat de plan Etat-Région des Pays de la Loire. Available at: http://www.paysdelaloire.fr/politiques-regionales/territoires/actu-detaillee/n/consultation-du-public-evaluation-environnementale-strategique-du-contrat-de-plan-etat-region-2/

5.! INSEE (2014) Un contexte favorable à une démarche active d’innovation dans les Pays de la Loire. Available at: http://www.insee.fr/fr/themes/document.asp?reg_id=3&ref_id=21743

6.! INSEE (2015a) 24 400 emplois sur le complexe industrialo-portuaire de Nantes Saint-Nazaire. Available at: http://www.insee.fr/fr/themes/document.asp?reg_id=3&ref_id=23116

7.! INSEE (2015b) L’innovation des PME industrielles : un levier stratégique face aux changements. Available at: http://www.insee.fr/fr/themes/document.asp?reg_id=3&ref_id=22427

8.! INSEE (2015c) Le bilan économique 2014. Une année économique encore morose dans les Pays de la Loire. Available at: http://www.insee.fr/fr/themes/document.asp?reg_id=3&ref_id=22789

9.! Ministère de l’Enseignement Supérieur et de la Recherche (2015), Les dépenses de R&D dans les régions françaises en 2012. Available at: http://www.enseignementsup-recherche.gouv.fr/cid92413/les-depenses-de-r-d-dans-les-regions-francaises-en-2012.html

10.!Observatoire Régional Economique et Social. Available at: http://ores.paysdelaloire.fr/

11.! Walendowski, J.; Henning, K; Zenker, A. and Meyborg, M. (2015) Regional Innovation Monitor: Thematic Paper 2 – Advanced Manufacturing Case Studies. Available at: https://ec.europa.eu/growth/tools-databases/regional-innovation-monitor/report/thematic


Appendix B!Stakeholders consulted

1.! Rémi Chevret, programme manager Third Industrial and Agricultural Revolution (TRIA), CCI Pays de la Loire (9 December 2015).

2.! Olivia Cahn, European & International Project Manager, EMC2 (10 December 2015).

3.! Thierry David, Director for Innovation and Economic Sectors, Agence régionale - Pays de la Loire Territoires d’Innovation, (3 December 2015).

4.! Annie MOYSAN, Advisor for economic development of industrial sectors, Agence régionale - Pays de la Loire Territoires d’Innovation (3 December 2015).

5.! Gaëtan Gaborit, Responsible of the Regional Economic and Social Observatory, Agence régionale - Pays de la Loire Territoires d’Innovation (3 December 2015).

6.! Jocelyn Lucas, Director, PROXINNOV (3 December 2015).

7.! Damien Forey, Director, Nantes Atlantique Place Financière (NAPF, 2 December 2015).

technopolis |group| Belgium Avenue de Tervuren 188a B-1150 Brussels Belgium T +32 2 737 74 40 F +32 2 727 74 49 E [email protected] www.technopolis-group.com

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