Market-shaping in mission-oriented innovation: delivering impact through a strategic collaborative management framework

Purpose Europe's mission-oriented innovation policy aims to tackle “grand societal challenges”, such as climate change, by “shaping markets” for the “common good”. Literature shows a gap between this approach and concepts that enable identifying effective initiatives by public and private innovators. The primary goal of this action research is to co-design a framework and develop practical instruments that support collaboration across public and private actors to deliver on the Missions, in particular for actors such as local authorities and businesses at local levels. Design/methodology/approach The paper focuses on the mission Climate Neutral Cities, and the pathway Local Energy Systems. The study engaged with representatives of six regional development agencies in northwest Europe and clean-tech industry innovators, researchers and the authors, a total of 60 people, which aimed to design more effective regional mission-oriented innovation programmes. The method fostered a research–practitioner collaboration that revealed links between academic concepts on innovation management and practical needs for operationalisation of mission-oriented innovation (MOI). Findings This paper proposes a single framework that integrates concepts mentioned in MOI literature, but that were not yet structurally explored, described and linked. These concepts are multi-level perspective, the PEST (political, economic, social and technological) analysis and innovation readiness levels. While action research with practitioners validated the relevance of the proposed integrated framework, a need for practical instruments to support local collaborative innovation was revealed. This resulted in the development of three “Canvasses” or practical tools that help effective local innovation actions to relate to broader societal Missions. Research limitations/implications The framework is a first approach to allow for more precise assessment of the current state of Missions, the setting of specific innovation targets and design of collaborative innovation projects between regional public and private societal actors in a complex environment. The approach both enhanced willingness of organisations to collaborate but also resulted in an increased risk perception of investments in innovations in a Mission context. The framework, however, has been developed within the scope of a single Mission and Pathway in its design stage, requiring validation beyond that scope. Practical implications The demonstrable impact of the process and framework is a collaboration between six regional development agencies. The collaboration will create Mission-oriented regional “demonstrator” programmes in asset categories, including public transport and renewable energy generation, aiming to deliver market-shaping approaches rather than individual pilots. The immediate process cost are €4.3 m is match-funded by the European Commission. The ultimate goal for the market-making programme is to trigger 10X private investments. Social implications Europe's MOI approach aims for radical market redesign. It offers significant future opportunities but also immediate market uncertainty, especially for innovators and investors. A perceived high risk in participating in innovation pathways is a structural weakness for Europe's chosen strategy. The research offers a management framework to calibrate for both regional public bodies and practitioners' practical steps that can reduce risks and take tangible steps in market-making. Originality/value MOI lacked a coherent strategic management framework. Close collaboration between research, policy and industry, focusing on the less well-described regional component of innovation, led to an enhanced theoretical framework and a set of tools or “canvasses” aimed at practitioners. The results allow innovation practices, including regional market-making methods and company strategies adapted to this dynamic environment.