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Programme Director: Sustainable growth and wellbeing from investments in disruptive technologies

25 Nov 2021

Upon its completion in October 2021, the Disruptive Technologies and Changing Institutions SRC programme published a policy brief based on its key results. The brief, titled “Sustainable growth and wellbeing from investments in disruptive technologies”, is currently available in Finnish.

The six-year Strategic Research Council (SRC) programme Disruptive Technologies and Changing Institutions (TECH) has come to a close. When it was launched in 2015, TECH was one of the first three SRC programmes. The ambitious objective of its projects was to explore Finland’s opportunities to benefit from disruptive technologies in the fields of digitalisation, artificial intelligence, automation and robotics, the energy market transformation and the platform economy. At the outset of the programme’s research activities, the energy transition was still a marginal topic, and the digital leap was still far from a reality.

Disruptive technologies progress at varying speeds, and the rate of change is always associated with uncertainty and unpredictability. In a very short period of time, the corona pandemic forced an enormous leap in the utilisation of digital technologies. This impetus was of significant benefit to the development of innovation ecosystems in the platform economy and the spatial data ecosystem. Responding to the challenges posed by climate change has accelerated the transformation of the energy sector. The use of robotics in care services has long been hyped, but given the current prospects, it is not realistic to expect any remarkable changes until 10 to 20 years from now.

Disruptive technologies as well as their progress and optimal utilisation can be affected by investment. Since 2016, investments in productive capital have increased less in Finland than in the EU or OECD countries on average. In Finland, the growth in gross capital formation was on average 1% in 2017–2020, compared with an average of 4% in the EU and 3.4% in OECD countries. In 2019 and 2020, investments did not even cover the consumption of capital. Carbon neutrality targets cannot be achieved and the effectiveness of social welfare and health care services improved with old technologies. The utilisation of disruptive technologies requires sharp growth in investments, especially in intellectual property, such as R&D projects and ICT systems. The digital leap is already underway in various fields, but additional sustainable investments are required in versatile digital solutions and the utilisation of both local and global data platforms.

Companies’ investment incentives, especially with regard to research and development, play a key role and can be influenced by, for example, innovation, technology and competition policies. Investments in the public sector are also crucial. Achieving cities’ carbon neutrality targets requires investments in district heating systems that utilise other than incineration-based technologies. The ageing of the population and the sustainability gap increase the pressure on investments that increase efficiency, boost productivity and guarantee the quality and availability of services. Investments are needed in both social infrastructure (e.g. education and healthcare) and technological infrastructure (e.g. spatial data).

Disruptive technologies also challenge legislation and innovation policies. The inertia of political processes and legislation has been considered a problem when swift responses to sudden changes in the operating environment are required. Benefiting from disruptive technologies requires multidisciplinary understanding and dialogue between experts of various fields. From a technological point of view, the most efficient solutions are not necessarily the best ones in the long run with regard to overall wellbeing. Implementing investments in an economically, socially and ecologically sustainable manner requires careful assessment in advance. Cross-disciplinary research-based data on disruptive technologies will be required also in the future, and it should be used to support decision-making. Such data can be acquired through the collaboration of, for example, engineering sciences, sociology, economics and humanities.

Projects implemented as part of the TECH programme highlight the following key insights on the utilisation of disruptive technologies in Finland:

  • Finnish companies should participate in global ecosystems, build internal ecosystems for themselves and utilise new platform-based innovation processes.
  • Finland should invest in an innovative and secure spatial data ecosystem and utilise it to support decision-making on our national wealth.
  • The introduction of robotics in the health and social services sector requires assessing systematically the fulfilment of investment objectives from the viewpoint of sustainable development.
  • In order to achieve cities’ carbon neutrality targets, investments must be made in non-incineration-based district heating systems, the reduction of buildings’ energy consumption and local energy production.
  • Extensive utilisation of demand side response requires investments in automation. The flexibility of consumption speeds up the market entry of variable energy production and increases cost efficiency.

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