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A country that innovates

Written by Kari Sipilä, D.Sc.(Tech)h.c., Future Innovations, Espoo, Finland

Source: Virtual Finland website

Inventiveness and innovation in Finland went from strength to strength during the twentieth century. A number of important inventions were made in the early years of the century, and subsequently, in 1945, a Finnish scientist, Professor A.I. Virtanen, received the Nobel Prize. The number of new products invented and commercialised during the last couple of decades has steadily increased, and many of these have found international success. Finland went through a major transformation, or series of transformations, during the twentieth century. The Finland of forest and farm became a fully fledged industrial economy around mid-century, while the Finland that entered the new millennium is increasingly a service and knowledge-based economy.

A world leader

Finnish researchers are at the leading edge of developments in a number of fields, including forest improvement, new materials, the environment, neural networks, low-temperature physics, brain research, biotechnology, genetic technology and of course communications. Their results speak for themselves. The neural network concept developed by Professor Teuvo Kohonen, for example, is probably the single most widely disseminated Finnish scientific achievement to date.

The main fields of Finnish industry are metal and engineering, forest products, and information and communications technology. Inventions and product development work have spawned numerous important and innovative new products. Areas in which Finnish engineers and companies have made a major international mark include such diverse products as mobile phones, icebreakers, cruise liners, lifts, paper machines, environment-friendly paper manufacturing processes, diesel engines, sailing yachts, compasses, fishing lures, frequency transformers, rock drills, tree harvesters, contraceptives, pipettes, and scissors and axes, together with Internet encryption systems and numerous other products of forestry, engineering, and information and communications technology. In the latter area, particular mention should be given to the Linux operating system developed by Linus Torvalds. In 2003, the private and public sectors in Finland invested around five billion euros in research and product development, equivalent to approximately 3.5 per cent of the GDP. Relatively, it is at the top level in the world.

Finnish innovation policy looks to the future

International evaluations of Finnish innovation activities, research and development ( R&D ), technology and competitiveness have shown that Finland ranks in these fields among the leading countries in the world.

Finland has a special organization, The Science and Technology Policy Council, for the formulation of national science, technology and innovation policies. The Council is headed by the Prime Minister and its members are drawn from the public and private sectors. In the public sector, government ministries are in charge of the implementation of these policies and, correspondingly, companies are active in the private sector. Additionally, there are several advisory, support and financing organizations to cooperate and assist in policy implementation and in the practical innovation development work.

The following are typical areas covered by innovation and technology policies:

  • education, knowledge and expertise
  • private and public R&D and its financing
  • cooperation between the private and public sectors
  • development of existing and new sectors
  • technological and social innovations
  • international competitiveness

The Council reasons that public funding must be increased faster than the estimated growth in the GDP. Alongside increases in funding, research and funding organisations must constantly develop their own decision-making mechanisms and increasingly prioritise important and promising fields.

This process of change and growth has been driven by a combination of public and private commitment. The state has systematically promoted new technologies, R&D, and new business creation, particularly over the past couple of decades. Numerous technological programmes have been launched, and extensive innovation and technology funding is provided through organizations such as the Finnish National Fund for Research and Development (Sitra), the National Export Credit Agency (Finnvera), the Foundation for Finnish Inventions, Finnish Funding Agency for Technology and Innovation (Tekes) and regional TE Centers.

In Finland in the field of innovation, there are also many other active organizations including government ministries and their regional offices, universities, science parks, organizations for industry, entrepreneurship or commerce, venture capital organisations, banks and consultancies. Funding is usually a combination of private and public financing

Patents, patents, patents

The number of patents a company or a country can lay claim to can be used as one measure of relative innovation. Finnish individuals, research teams, and companies file around 2,000 patent applications annually, of which around 70 percent result in patents. These figures were slightly higher some years ago during the information technology boom. Per capita, this places Finland in the number four slot worldwide, after Japan, the USA and Germany.

The current leading organization in terms of the most domestic patent applications lodged is Nokia Corporation, which filed 177 such applications in 2003. Second in line is Metso Corporation, with 172 applications, next is the Technical Research Centre of Finland (VTT ) with 54 applications, Outokumpu Corporation with 52 and Kone Corporation with 49. In addition to domestic patents, international patents, trademarks and company secrets have a very important role in the business world.

Interesting Finnish innovations past, present and future

Bringing sound to the movies

Thanks to a series of inventions associated with bringing sound to the world of film that he made at the beginning of the twentieth century, Eric Tigerstedt is widely considered one of Finland's most talented inventors ever. Tigerstedt lodged a total of 71 patents in numerous countries between 1912 and 1924. He got the inspiration for his ideas during a presentation of the new motion picture technology developed by the Lumière brothers held in Helsinki in summer 1896, only six months after its première in Paris. Tigerstedt's dream was to bring sound to Lumière's silent pictures and his own film, Word and Picture, which was presented to a gathering of scientific dignitaries in Berlin in 1914, was the world's first successful “talking picture”. Although his technology was never commercialised, he went on to develop the triode and directional loudspeakers. Tigerstedt's ideas also presaged such future inventions as the television and the mobile phone. "There will come a time," he wrote in his diary, "when people will be able to sit at home and follow events around the world through a piece of equipment that I refer to as the electric eye." And in 1917, he lodged a patent for what he described as a "pocket-size, folding telephone with a very thin carbon microphone".

Locking it up

Every Finn is familiar with the simple but ingenious Abloy lock. The same basic design, for which Emil Henriksson received a patent in 1919, is still in production today. Henriksson later related that his inspiration for the lock came from his work with cash registers.

Measuring the weather

The radiosondes and other weather-related equipment, such as airport weather stations and industrial hygrometers, developed and produced by Vaisala Corporation, have been among the pioneers of the Finnish high-tech sector. The first Finnish radiosondes were developed by Professor Vilho Väisälä in 1931, one year after the Soviet Union had sent up its first sonde. Radiosondes produced by the company named after him are routinely sent 20 to 40 kilometres into the upper atmosphere around the world to measure key weather parameters such as temperature, pressure, humidity and wind speed. Vaisala's product development has continuously introduced new successful devices to the world market.

Fit for a Nobel

Professor A. I. Virtanen's breakthrough in producing and treating silage and developing the AIV silage system, which was patented in 1932, won him the Nobel Prize for Chemistry in 1945.

Virtanen and his research team developed the AIV concept while working in the laboratories of the dairy company, Valio, in their search for ways to improve the taste, smell, and shelf-life of milk and dairy products. The AIV method is based on preventing the decomposition of freshly cut silage when stored in silos by raising its acidity through the addition of concentrated sulphuric and hydrochloric acid. The use of AIV silage spread rapidly after its invention, and it is still used in countries where feeding cattle during the winter is largely or wholly dependent on stored forage. The method has proved very successful in extending the shelf-life of butter, for example.

Flash smelting of copper ore

The introduction of flash smelting into copper production has been one of the most important inventions ever made in Finland in terms of financial return. Outokumpu Corporation received a patent for the method, developed by engineers Petri Bryk and Johan Ryselin, in 1947. Flash smelting is a pyretic reaction that makes use of the intrinsic combustion heat contained in the ore being smelted when it reacts with preheated air. The sulphur dioxide generated by the process that used to be released into the atmosphere is now recovered to minimize environmental problems. In addition to inventions such as flash smelting and other basic production technologies, Outokumpu and its subsidiaries have developed numerous other successful products, ranging from metal detectors to environmental and space technology.

Forest-based strengths

The numerous inventions made by Finns in areas such as paper machine automation and advanced environmental protection systems for paper production are excellent examples of the massive amount of expertise that Finnish engineers have built up in the forest products sector. The production of fully symmetrical high-quality paper, in the shape of Valmet's (now Metso Corporation) SYM concept, was one such major breakthrough, made by a young engineer, Matti Kankaanpää, and others at the end of the 1960s and beginning of the 1970s. Kankaanpää, later to become Director General of the company, had a total of 29 patents to his name. Another leading light in paper and pulp technology is Professor Johan Gullichsen, who received the Wallenberg Prize for his work on pulp flow pumping. The pace of paper machine development has further accelerated in recent years, and numerous new inventions and refinements of existing technologies are introduced every year, particularly in areas linked to automation and environmental technology.

The sweetener that's good for you

Xylitol is generally considered the first fruit of innovation in the Finnish food industry to become a truly world-class product. Although xylitol was discovered as a sweetener in Germany in the 1920s, Finland's Cultor was the first company to patent advanced xylitol production technology. The original patents were filed in 1969, since when numerous further patents, based on work by scientists in Finland and elsewhere, have been added. Cultor, which later joined forces with Denmark's Danisco, remains by far the world's largest producer of dental-friendly xylitol, which is widely used in sugar-free products ranging from chewing gum to cough syrup and toothpaste.

A finger on the pulse

Small, low-cost heart rate monitors developed and produced by Polar Electro Ltd have emerged as a major international success in the sports and keep-fit arena. The idea for the original product came to Polar Electro's founder, Professor Seppo Säynäjäkangas, as a way of helping him get more out of his regular cross country skiing circuits. He applied for his first patent in 1975 but it took more than 10 years to get the excellent product onto the market. Drawing on the opportunities opened up by modern electronic technology, the company now offers a selection of heart rate monitoring products marketed around the world to people interested in keeping a check on the quality of their physical activities and general well-being. During recent years the company and its owners have also been active with new innovative applications in the field of communications.

Treating patients the biodegradable way

Professor Pertti Törmälä's work in inventing and developing biodegradable surgical nails and screws for use in treating broken bones received its first patent in 1986. Törmälä and his team, and the company set up to commercialise his technology, Bionx Implants Ltd, have since extensively pioneered the use of resorbable implants and other biodegradable materials in medical applications. Bionx Implants' products are manufactured from extremely strong lactic acid polymers. After supporting the bone for a period of between three and six months, they dissolve back into lactic acid and are absorbed by the body's cells.

Reducing cholesterol the natural way

Benecol, the cholesterol-cutting margarine produced by the Raisio Group, is an excellent example of how successful collaboration between academic and private sector research can be. Professor Tatu Miettinen, Dr. Hannu Vanhanen, and Raisio's Research Manager, Ingmar Wester, worked closely together in developing a plant-derived stanol capable of significantly reducing human cholesterol levels. The first patent applications were filed in 1991. Margarine was the first product to be developed but others, such as salad dressings and spreads, have been added. Benecol is available on the US and continental European markets, where it has, however, met tough competition.

Who hasn't heard of Nokia?

With thousands of researchers and product development engineers on its payroll worldwide, plus what has become one of the world's most valuable brand-images to its name, Nokia is at the leading edge of mobile telephony and related communications technology.

Nokia is the biggest manufacturer of mobile phones in the world and today spends annually more on R&D than the Finnish state. Nokia companies file by far the largest number of patents in Finland and in addition to that, in many other countries. The roots of Finland's mobile phone phenomenon go back to research work on point-to-point communications initiated in the 1970s by the country's military and Finnish State Railways. The technology first reached the consumer through simplex car phones. Simultaneous dialogue was made possible by a patented duplex filter developed by Lauri Kuokkanen and others. Direct dial car phones were introduced in Finland in 1971, the Nordic NMT system in 1982, and the digital GSM system in 1992. Subsequently, new solutions, combinations and generations have conquered the world amid robust competition.

Awards to innovative companies

Finnish invention activity is also promoted through international, national and regional, or industry-specific competitions, seminars, exhibitions and awards. The most important of these is the annual InnoFinland project, which culminates in the presentation of InnoFinland Awards by the President of the Republic, currently President Tarja Halonen, to successful new innovative companies or innovators. Among the winners have been many innovative young companies such as Codetoys, Elma Electronic Trading, Exel, Finnzymes, IST International Security Technology, Liekki, Marioff, POM Technology, and Stick Tech.

Innovative small and medium-sized companies, as well as big ones, are also honoured with the Award of Internationalisation. Among the winners have been many big innovative companies such as Ahlström, Basware, Fiskars, Jaakko Pöyry, Kone, Marimekko, Nokia, Orion, Planmeca, Polar Elektro, Suunto, Wärtsilä and YIT.

It is also worth mentioning that Finnish companies and researchers have frequently been winners of Sweden's Marcus Wallenberg Award in the field of forest technology; most recently POM Technology in 2004.

Moreover, the Millennium Technology Prize, established in Finland, is awarded every two years to an individual from anywhere in the world for outstanding technological achievement that directly promotes quality of life. It carries prize money of a million euros, making it the world's most lucrative award for technology.

The new Europe and the challenging world

The beginning of the twenty-first century has already brought new challenges for Finnish innovation and its success in business. Competition is worldwide both in well-established areas such as the metal and engineering industry and the forest products industry, as well as in the third major engine of today's Finnish economy, the information and communications technology sector. The pace of development can also be expected to continue accelerating in younger sectors such as new materials, biotechnology, pharmaceuticals, virtual and mobile attractions, health care, fitness, social innovations, e-commerce, and other service sectors. There is also a continuous need for new innovations for certain groups of consumers, for instance, senior citizens or active fitness enthusiasts.

Finland, Finnish researchers, innovators and companies look to the future confidently. But it is important to stay ahead of the competition. Success factors will be education, knowledge, cooperation and competitiveness. Future success will call for a continued, broad-based commitment to fostering knowledge and innovation from the school classroom onwards. Good R&D and adequate R&D funding, will be of key importance in ensuring that future generations will be even more innovative and inventive than their predecessors.

A small country such as Finland needs to specialize and focus on areas of specific excellence if it is to be competitive in the global marketplace. And that means being successful in commercialising the right products at the right time, and marketing them to the right people in the right places worldwide.

Published April 2004

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