Measurement of Innovation in the South African

Cultural & Creative Industries:

A Methodological Challenge?

Gerard Ralphs | gralphs@hsrc.ac.za

Programme Manager & Policy Analyst, CeSTII, HSRC

Pre-doctoral Candidate, University of Johannesburg

HSRC Seminar Series, 2 June 2020

Acknowledgements

• Department of Science and Innovation

• Human Sciences Research Council:

– Centre for Science, Technology and Innovation Indicators (CeSTII)

– Inclusive Economic Development (IED)

– Impact Centre

– Learning & Development

• University of Johannesburg:

– The DST/NRF/Newton Fund Trilateral Research Chair in Transformative Innovation, The Fourth Industrial Revolution and Sustainable Development

Hannes Coetzee

Images courtesy of Barney Burke,

burkedigitalpix.com

https://youtu.be/RS_kQdwg8ok

March 2011

David Kramer - The Sound of Silence

Invisible musicians of the Karoo

Hannes Coetzee

Hannes as a teenager decided, sitting there on his

own in a koppie in the Karoo, that to play alone

like that was just not on. He wanted to create a

sound that would sound like two people playing

together. And so he thought about it a lot: How

could he come up with a way that sounded like,

what we call a voorspeler and a slaaner (so

someone who plays in the front and someone who

accompanies him)?.

So Hannes developed a technique that I have

never seen anywhere else in the world. And so I

thought it was absolutely unique, and a small

video clip was put on the YouTube by an American

and it became an overnight success. He became a

cult hero on the Internet. And we got an invitation

to go to America about three years ago to attend a

slide guitar workshop in Seattle. So that Hannes

could teach the Americans how to do this magic

thing that he does. (Kramer, 2014)

“

1. Semantics

2. Global and national policy

relevance of the CCI incl.

innovation

3. SA Cultural Observatory & CCI economic

indicators

4. Innovation studies in SA,

including measurement

agenda

5. Innovation measurement in

the CCIs: towards a multi-

dimensional sectoral

framework

Objectives and outline

#1 WHY MEASURE?:

Explore policy intersections & disjunctures between innovation and the CCI in SA

#2 HOW TO MEASURE?:

Surface some methodological issues & challenges that relate to measurement of innovation in CCI

Outline: Framing

questions/Objectives:

1. Semantics

Semantics_Innovation

Innovation = focus on implementation

• An innovation is a new or improved product [good/service] or process (or combination thereof) that differs significantly from the unit’s previous products or processes and that has been made available to potential users (product) or brought into use by the unit (process). (Oslo Manual, 2018)

Working Party of

National Experts

of STI (NESTI)

Semantics_‘Cultural & Creative Industries’

Source: 2009 UNESCO Framework for Cultural Statistics

2. Global and national policy

relevance of the CCI incl.

innovation

Renewed global policy relevance of the

CCIs, incl. innovation

(Labadi, 2020):

• Beyond culture as

economic

development,

alternative models of

fulfilled lie

• Identity, belonging,

post-conflict

rebuilding, cohesion

(EY, 2015):

• 3% of global

GDP

• 29.5 million

jobs

worldwide

(Restrepo & Marquez,

2013):

• ‘Orange Economy’

as a developmental

framework

(Florida, 2002):

• ‘Creative Class’

– focus on

occupations

(Howkins, 2001):

‘Creative Economy’

– focus on IP

“a restatement of the case for

supporting the arts and

culture, couched in economic

language as preferred by

funding agencies”

(Flew, 2014: 11, as cited in SACO,

2017/18: 10)NESTA (2008):

• “hidden innovation”

Sapsed &

Nightingale

(2013):

• “fuse” of

digital and

creative

businesses

• Cluster

approach

COVID-19

Contributions, challenges & opportunities CCIs:

• Support & solidarity incl. frontline workers

• Mental health/well-being of populations in lockdown

• Forced move to digital

• Loss of income for performers/practitioners

• Loss of revenue for cities – cancellation of festivals

• SA long divided public discourse on ‘health’ of CCI sector

• Opportunity for innovation and ‘pivoting’?

Coronavirus (COVID-19) and

cultural and creative sectors:

impact, policy responses and

opportunities to rebound after

the crisis | 17 April 2020

https://www.oecd.org/cfe/leed/

culture-webinars.htm#CCIs

Pivoting in the context of COVID-19:

Many examples of CCI innovation

Key policy domains for CCI

National Development Plan

“Arts & Culture” (Cultural Policy)

“Higher Education, Science &

Technology (Innovation)” (Innovation

Policy)

“Trade & Industrial

Development” (Industrial

Policy)

Clear NDP policy rationale, multi-dimensional

Dimension NDP policy statement

Intellectual “Arts and culture open powerful spaces for

debate about where a society finds itself

and where it is going” (p. 36)

Psycho-

social

“Artistic endeavour and expression can

foster values, facilitate healing and

restore national pride” (p. 36)

Industrial/

Economic

“The country’s rich cultural legacy and the

creativity of its people mean that South

Africa can offer unique stories, voices

and products to the world” (p. 36)

“Promoted effectively, the creative and

cultural industries can contribute

substantially to small business

development, job creation, and urban

development and renewal” (p. 36)

Agricultural Cultural

No. of times “agricultural” and

“cultural” as words appear in

the NDP

Timeline industrial policy:

• Reimagined Industrial Strategy (forthcoming) To include CCI

• 2018/19-2020/21: 10th Industrial Policy Action Plan (IPAP)

• 2017/18-2019/20: 9th IPAP

• 2016/17-2018/19: 8th IPAP

Policy histories and paths: disjuncture, intersection

Timeline cultural policy:• 1996: White Paper on Arts, Culture and Heritage

• 1997: Cultural Industries Growth Strategy

• 1998: Creative South Africa: A strategy for realising the potential of the Cultural Industries

• 2014/5: Launch of South African Cultural Observatory

• 2015: 1st Draft Revised White Paper

• 2017: 4th Draft Revised White Paper

• 2017: Copyright Amendment Bill

Timeline innovation policy:

• 1996: White Paper

• 2002: R&D Strategy

• 2008: 10 Year Innovation Plan

2012: Ministerial Review

• 2019: White Paper

• 2020: Decadal Plan (forthcoming)

3. SA Cultural Observatory

& CCI economic indicators

South African Cultural Observatory

• Advanced theoretical and policy-relevant research on cultural trends and the cultural economy

• The conceptualization and collection of statistics (data-bases)

• Monitoring and Evaluating the impact of cultural events

• Providing physical and online access to the cultural information

• Capacity building within the Arts, Culture and Heritage sectors and Creative Industries

• Networking, partnering and knowledge sharing

• Promoting cultural diplomacy

Online at: southafricanculturalobservatory.org.za

Some updated economic indicators

Indicator 2016 2018

Percentage contribution to

GDP

1.5% 1.7%

Nominal contribution to

GDP

R62 billion R74.39

billion

GDP contribution with

multiplier

5.2%

Contribution to total

employment

6.72% 7%

No. of jobs* 1.06 million 1.14 million

Exports of cultural goods US$ 300.9

million

US$ 446.5

million

Imports of cultural goods US$ 472.0

million

US$ 469.8

million

Trade surplus/deficit (US$

171.1)

(US$ 23.3

million)

Data source: SACO (2020, 2017) & UNESCO UIS (2020)

*Includes cultural occupations in CCIs and non-CCIs, and non-cultural

occupations in CCIs, according to “Cultural Trident”

Community services 23.6

Financial and business services 18.7

Trade and accommodation 15.0

Manufacturing 13.0

Transport and communication 9.8

Mining 8.1

Construction 3.9

Electricity and water 3.8

Agriculture 2.4

CCI 1.7

100.0

Treemap: GDP Composition 2018 (%)

Performance by domains

Data source: SACO (2020)

Design & Creative Services 50%

Books & Press 14%

Audio-Visual & Interactive Media 11%

Cultural Education (Transversal) 11%

Performance & Celebration 7%

Cultural & Natural Heritage 3%

Visual Arts & Crafts 3%

100%

Treemap: GDP contribution by domain, and domain growth in % (2018)

0.3%

3.1%5.2%

3.4%

3%

-2.4%

5.9%

Implications:

• Drivers of growth? Decline?

• Impact digitalisation and 4IR

(e.g. SACO, 2018)

• Employment

Social sciences and humanities R&D:

2005-2014

Figure 2: International comparison of R&D

expenditure by research field as a % of GERD,

2014

Figure 1: International comparison of R&D

expenditure by research field as a % of GERD,

2005[1]

Figure 4: Total gross domestic expenditure on R&D

(R'000) by humanities research field, 2005-2014

Figure 3: Total gross domestic expenditure on R&D

(R'000) by social sciences research field, 2005-2014

Data source: Molotja & Ralphs (2018)

Global policy evaluation frameworks for

CCIs

Framework to

measure & monitor

enabling

contribution of

culture to local &

national

implementation of

SDGs

• Relies on

country

implementation

4. Innovation studies in SA,

incl. measurement agenda

Innovation studies in SA: Actors and issues

• Centre for Science, Technology and Innovation Indicators

(CeSTII) – mandated DSI early 2000s

– STI indicators + analysis

– Measurement agenda-setting (e.g. Kruss, 2018)

• DST-NRF Centre of Excellence in Scientometrics and

Science, Technology and Innovation (STI) Policy (SciSTIP)

• National Advisory Council on Innovation

– Innovation policy (Cele, Luescher & Fadiji, 2020)

– Transformative Innovation Policy Consortium (TIPC) – SA

partner

• Innovation in the informal economy in developing nations

(Kraemer-Mbula & Wunsch-Vincent, 2016); in South

Africa (Mustapha et al, 2020 forthcoming)

• Rural innovation, municipal innovation (Jacobs, 2019)

• Social innovation (e.g. Bertha Centre)

• Public sector innovation (Arundel, 2019)

– Centre for Public Service Innovation (CPSI)

• Innovation and industrialisation as overlapping policy

domains

– UJ Colloquium 2019 – SARCHI Chair Industrial Policy

Innovation measurement agenda – Business

sector focus

SA innovation surveys:

• 1990s – sectoral focus

– Manufacturing 1992-1994 (UCT/FRD)

– Manufacturing & Services 1998-2000

(University of Pretoria, Eindhoven)

• 2000s – national

– SA Business Innovation Survey 2002-

2004 (HSRC, CeSTII)

– SA Business Innovation Survey 2005-

2007 (HSRC, CeSTII)

• 2010s – national + sectoral

– Manufacturing & Services 2010-2012

(HSRC, CeSTII)

– SA Business Innovation Survey 2014 –

2016 (HSRC, CeSTII) forthcoming

– SA Agricultural Business Innovation

Survey 2016 – 2018 (HSRC, CeSTII)

forthcoming

• Methodologies adapted:

• OECD Oslo Manual

• Community Innovation Survey (CIS)

Eurostat

https://sabizinnovationsurvey.blog/

What does a “traditional” SA innovation

survey measure?•Product, Process, Marketing, Organisational

•Novelty (e.g. new to the firm, market, world)

•Contribution of innovation to turnoverTypes of innovation

•R&D (in-house, outsourced), training, acquisition of equipment, software, hardware, design, engineering

Innovation activities and expenditure

•Type of partner e.g. university, other firms

Sources of funding, information and

cooperation

•Product outcomes, Marketing outcomes, Process outcomes, Financial outcomes, etcEffects of innovation

•Grants or contracts requiring innovationPublic procurement

•Types of protection, eg. Trade secrets, patents, plant breeders rights. IP

•Cost, Market, KnowledgeBarriers to innovation

•E.g. AI, robotics, remote sensing, etc.

Use of new/advanced

technologies

Typical approach:

• Stratified

random sample

– Formal

agreement DSI

and Stats SA

for production

of STI statistics

• Size classes (i.e.

turnover cut-off,

excludes

informal

enterprises)

Uses of business innovation data

• International

benchmarking and

comparison

• Key questions:• e.g. impact of

innovation on

employment growth in

manufacturing (Sithole

& Buchana)

• Policy evaluation &

advice • e.g. National Advisory

Council on Innovation

• Creation of new

incentive programmes

(innovation support) SA – Nigeria innovation fact sheets – services and manufacturing

(CeSTII, 2019)

New measures & indicators:

beyond purely quantitative approaches

• Dynamic interactive capabilities

between formal knowledge producers

& communities

– Local Innovation & Production Systems

approach

– Case study research – 3 provinces

– Digital storytelling

– Photo-voice

– Engaged scholarship approach

• Innovation in the informal economy –

Sweetwaters, Kwa-Zulu Natal

– Mixed methods – survey, interviews

– Large-scale fieldwork effort, snowballing

approach

– Multi-sectoral

– Geo-spatial analysis

http://hsrc.ac.za/en/departments/cestii/engag

ement-innovation-and-inclusive-development

5. Innovation measurement in

the CCIs: towards a multi-

dimensional sectoral

framework

Why measure CCI innovation in SA?

– Increasing contribution GDP, unmeasured intellectual and psycho-social contributions – but sector challenges

– Imperative measure contributions SDGs, NDP, policy effectiveness

– SA specificities and urgencies – large informal sector

– Understand drivers, unblock challenges for sector, promote inclusion

– More innovation than R&D

– Example of SACO (2019) innovation study

• Cape Town cluster

• Fuse digital and creative skills

• One city focus, formal enterprises

– Key issue! Copyright Amendment Bill 2017

• Contestation in SA over ‘fair use’ provisions

• Implications for trade

What kind of

innovation data

would help

policymakers make a

difference in the

sector?

In measurement, context is key

“Scholars have warned of the risks for designing

relevant and effective policy instruments in

emerging economies, based on indicators that do

not measure the full complexity of innovation

and technological upgrading in heterogeneous

contexts. There is growing consensus around the

need to better align what is measured, with what

should be measured.” (Kruss, 2018: 347)

Innovation in the Cultural & Creative Industries:

sectoral specificities

CCI is a multi-sectoral ‘system of innovation’ (Malerba

• Not just formal business for-profit firms, but also non-profit organisations, and government (museums, heritage sites), informal businesses, households/individuals

Multiple purposes e.g. not just revenue/profit/survival; public understanding, curiosity, healing, etc.

• Different drivers of innovation (e.g. open data in the public sector vs. paywalls in the private sector)

• Different uses of innovation data for different types of policy actors & policy mixes (e.g. industrial policy vs cultural policy vs innovation policy)

Measurement challenges!

Oslo Manual 2018: some key changes

Revised definition of innovation, includes all sectors

Reduces no. of types of innovation to 2 ie. product and process

Recommends combined approach in “measurement experiments”

• Subject-based vs. Object-based approach (focal innovation)

How to measure? Gault (2018) recommends

a systems approach

Formal business sector

Sampling: Representative sample (random

stratified) –business register

Approach:

CIS-like, subject-based approach combining object-based questions

Users:

DSI, DTI, DHET

Internationally comparable indicators

Informal business sector

Sampling:

Snowballing, Location-based, >1

employee?

Approach:

Mixed quant-qual, context key

Users:

DSBD, DTI

Government sector

Sampling:

Census approach possible

Approach:

Public sector innovation

Users:

CPSI, DPME, DSI

NPO sector serving

households

Sampling:

Census approach possible

Approach:

Public sector type questions

Users:

Industry associations

Household/ Individual

practitioners

Sampling:

Snowballing

Approach:Household surveys – cost prohibitive?

Users:

DAC, DTI

Framework Conditions: Regulation | Trade regimes | Demand-side | Shocks

Flows and linkages: Finance | IP | People | Tech | Information