The viable systems model applied to a national system of innovation to inform policy development

Abstract

This paper outlines how the viable systems model (VSM) can provide insights into a National System of Innovation by focussing on the necessary variety needed to match the system's changing external environment. Because an innovation system is more diffuse than a firm, the VSM needs to be described within an 'ecological' metaphor. This approach gives insights into the system's learning processes, showing that there can be a trade-off between variety and control for the system to maintain a fixed level of viability. Furthermore, for many innovation systemsthe coordination is 'soft'; taking place through markets, through Government directions, and through relationships embodied in clusters, unions or industry groups, etc.Governments generally can only manage the system indirectly by facilitating the generation of the necessary variety, influencing strategic directions, filling gaps in the system and encouraging coordination. © 2005 Springer Science + Business Media, Inc.