Technological innovation in services and manufacturing: results from Italian surveys

This paper provides fresh empirical evidence on technological innovation in the service sector, and highlights major similarities and differences with manufacturing. The main findings are the following. Technological innovati on is quite a diffused and variegated phenomenon in market services. Engine ering, technical consultancy, computing and software emerge as the most inn ovative sectors. Innovation expenditure per employee in these industries is rather close to the manufacturing average. Service firms as well as the ma nufacturing ones rely on a wide range of innovation sources. The acquisitio n and development of software and investment in machinery are the most cite d. Investment, R&D and software are the major components of firms' innovati on expenditure. Both in services and manufacturing the most important objec tive of firms' innovation strategies consist of improving service/product q uality, increasing market shares and reducing production costs. Major obsta cles for introducing technological innovation in services, as well as in ma nufacturing, are of an economic nature -i.e. lack of appropriate sources of finance and cost of innovation too high. Technological information is draw n mainly from in-house production departments as well as from outside suppl iers of equipment, clients and customers. Again this is a pattern which is quite similar to the one found in the manufacturing sector. Finally, in the near future the importance of technology for firms' performance is expecte d to increase in all service industries. Overall, service and manufacturing sectors show more similarities than differences with respect to some basic dimensions of innovation processes. (C) 1998 Elsevier Science B.V. All rig hts reserved.