Innovativeness and Company Innovation Index – Theoretical and Methodological Aspects

Abstract

The report examines the impact of all types of innovations on the overall level of innovation capacity and innovativeness of companies. Special and main attention is paid to the methodological aspects of innovativeness and innovation capacity function at company level. The innovations are presented as a part of the so called innovation capacity function. This function determines the companies’ innovation capacity, and the last strongly affects the production output, described by the production function. We considered a basic theoretical approach for the innovations, and applied it to evaluate the innovation index and innovation capacity for companies of industry (but not only). On that base, the innovation development of a companies can be traced for a long period of time in the past (using monthly or annual data). In order to perform the analysis different kind of relevant data can be used, provided by the National Statistical Institute and Eurostat. Our main statement is that in an uncertain and unstable economic environment, innovations can be successfully used to ensure economic stability and production growth. On the other hand, using a function and index to evaluate the innovativeness of companies can be useful for establishing their position in the market (in terms of their innovativeness) and developing future innovation strategies. There are already some innovations (product, technological, organizational) in the Bulgarian business sector, but they are of low added value. Generally, these innovations are at the regional and national level. To ensure their development and growth, companies of the Bulgarian industry have to develop innovations with higher added value on international level. The dependence between innovations and growth can be observed in the innovativeness function.