Analysis indicators to determine the success or

Analysis of FIS and SNM Frameworks

Shruti Sriram: 4699262

Delft University
of Technology



assignment will deal with two key theoretical frameworks that are used to comprehend
the various innovation methods: Functions of Innovation Systems (FIS) and
Strategic Niche Management (SNM). Moreover, a variant, Functions of Innovations
Systems Van Alphen will also be analysed.

At first,
we will discuss the rudimentary theories of each framework, followed by a relative
approach to bring out the various similarities and differences. Finally, a
compatibility assessment will be carried out to appraise up to what level these
frameworks complement each other.






of Innovation Systems is a concept to help hypothesize the entire process of technological
transition by using features or indicators to determine the success or failure
of a technological innovation focusing on the dynamics between the actors and
the existing institutions in the structure’s transition. The FIS approach is
mainly used to track the entire timeline, starting from the growth of the
technology to the largescale implementation of the new technology. This
approach is considered suitable for developed countries or nations with the
ability to develop the technology on their own. This is due to the fact that
the very first step includes entrepreneurial activities, which is imperative to
all the other following steps. Thus, there can be no entrepreneurial activities
if the country is not in the position to

the technology.


The 7
functions include:


1: Entrepreneurial activities

being the main actors for transferring technology into application by playing
the most important role in a well-functioning innovation system. They turn the
potential of new knowledge, networks, and markets into concrete business opportunities.
They could be entrants finding business opportunities in new markets, or
incumbent companies who diversify to absorb new developments. Entrepreneurs
take advantage of business activities to solve most problems relating to
product application. They are the inevitable bridge linking technology with
customers. This function can be analysed by new entrants, the number of

of incumbent actors, and the number of experiments with the new technology (Bergek,
Hekkert and Jacobsson, 2008).


2: Knowledge Development

development for any particular technology depends on factors like R
funding, patents etc which give an indication of the existing system. It is of
importance to bring the new technology to the level where it can compete with
the current technology.


3: Knowledge Diffusion

diffusion occurs mainly through interaction with consumers and various actors (government,
competitors, scientists, market). This stimulates cooperation and communication
between actors with aids in successful adoption of technology. Mapping of this
function could be done by number of workshops, conferences and network sizes
over time (Kamp, 2002).


4: Guidance of the search

In the
advent of limited resources, it is not advisable to explore every option
(technical or in the market) for a technology. Through the aforementioned functions,
decision must be taken over which could be the most promising path to invest
resources in. This function calls for a greater consideration of the societal
aspects of the technology and also to set realistic opportunities for the


5: Market Formation

function is significant for providing a potential market for a new technology.
It is a humungous task for a novel technology to take on the giants in a market.
Thus, new technologies need protection, so niche markets are created (Hekkert et
al, 2007). Despite being small, if the new technology is capable and better
techniques are adopted to deliver the product, the brand starts growing and in
turn we achieve market recognition.


6: Mobilization of resources

new technologies need financial input and skilled human resources from external
benefactors. It is vital during this time to allow the system to nurture and
grow into the market. This input could be from either the government as well as
external organizations.


7: Support from advocacy coalitions

is always some form of opposition to emerging technologies. This could be the
differences in the interests of the existing regime, hesitation to support
because of the uncertainties involving in the new technologies or the even the laws
and policies of the country. Advocacy coalitions come into the picture now to
strive for the acceptance of the system into the existing regimes. This could
be done by lobbying for tax subsidies or inspiring the technologies to be
placed at the forefront of the developing
country’s agenda.




Van Alphen is a modified version of FIS approach developed by Hekkert et al. It
consists of a set of functions that need to be addressed and evaluated for the
successful implementation in developing countries (Van Alphen et al, 2006). The
7 vital functions include:


an adaptive capacity: This function focuses on creating and nurturing an
adaptive human resource within the developing country. This could be done by creating
awareness in various forms, like conducting workshops, seminars, media and much
more. This is a very important initial step in realising the technology.


Knowledge diffusion: This function mainly deals with the transfer of knowledge
between various organizations within a country or even from another donor
country for the successful development of the innovative technology. Networking
plays a major role in the knowledge diffusion.


Demand articulation: This function points out to the important activity of
donor country in setting up a definitive expectation of the particular
technology and also demand of the market. This is due to the fact that the host
country could have lack of resources for the integration of the technology into
the existing regime.


Creation of legitimacy: As the name suggests, this function mainly deals with social
aspects of regime, where there is need for social acceptance of the innovative
technology. This could be by means of creation of advocacy groups, technical
institutions and political parties.


Resource mobilization: Owing to the possibility of political instability in the
developing nation, investors might be hesitant to provide monetary help to Renewable
energy technologies. This condition can only go worse when the high
installation costs are considered. Thus, there is a necessity to provide
subsidies and other measures by the government to encourage aid.


Market formation: This function is very crucial for the successful implementation
of RET in the host country. Entire market for RET needs to be formed due to the
existing dominance of conventional fuels. This could be done by taxing the fossil
fuel companies, by decreasing the subsidies given to them and by regulatory
changes that make entry of RET possible. It would also be an advantage if the
host company could have access to the markets of the donor.


Entrepreneurial activities: The more the number of entrepreneurial activities
in the country, the higher the chance of RET penetrating into the market with
existing energy regime. Even a combination of smaller entrepreneurial
activities can aid in creating something more viable and competitive with
existing technologies.


The major
difference between FIS Van Alphen and the FIS approach is that, the former
approach could be used in a developing country with a possible inability to
have technological developments by itself, owing to the need to have external
organizations of countries.




approach is mainly used to explore an innovative technology through experiments
with the aim of implementing the technology in a developing environment,
subject to socio-technical pressures. This approach was initially born out of
the restrictions of the existing instruments that were applied to the
technological innovation. Developers of this approach realised that innovative
technologies were not being implemented out of laboratories and hence devised
this approach to help them compete with existing technology, where they lacked
much chance to succeed since conventional practices were already improved over
time and gained large profits.


can be considered to compose of two aspects: as a political instrument and as a
research tool. Three main processes include:


1.     Voicing
and Shaping the expectation of niche: Mainly focuses on giving the involved
actors some idea about the technology under consideration. This function also
helps to gain some inputs from investors.

2.     Network
Formation: The network that is formed at the very beginning of any technology
is a crucial factor even during its subsequent growth. The various actors
involved must strive to keep maintaining and growing the technology.

3.     Learning
Processes: Once the technology has been experimented in the market, it is
important that the actors learn from the barriers encountered in the path to
adapt and reform the niche in an appropriate way to help it develop ahead.








Van Alphen



 Technology could already be in market

Technology could already be in market

Initial stage of technology.

Multilevel perspective



to a great extent.

 Market protection


Not necessary


Technical/social perspective

More emphasis on social perspective.

More emphasis on social perspective.

More emphasis on technical perspective.

 Cases considered

Could be multiple

Could be multiple

Predominantly singular


Transition from existing technological

Transition from existing technological

Transformation from a niche to a
self-sustainable system in market.

Table 1: Key Comparisons




Upon analysis of FIS and SNM frameworks, one of the major
differences is the application extent that each of these two have. While FIS is
focused mainly on the implementation and progress of economic, social and
technological aspects of a process in larger regions- like countries or
islands, SNM is predominantly focused on early, niche level implementation of technologies.
Geographically, this framework is more limited, for example, a small region
with a single pilot project or connected projects.


On this note, it can be said that both the FIS and SNM
frameworks can be a complement to each other in developing an innovative
technology. At first, when the new pilot project has been created, SNM approach
could be used to help the innovation to survive in that environment. Following
this, it is important to develop networks, to increase the attention and
resources that are needed for the technical and economic optimization. When a
decent job has been done and he innovation has developed from a single pilot
project to more numbers, it can be seen that the networks have become stronger
and the resources have expanded with enhanced learning.


Next, it is of great importance to identify the possible
drivers and barriers that might enhance or hamper the implementation process,
thus making this one of the key elements for the success of the innovation
technology development. Here, the seven functions elaborated in FIS approach
can be implemented. By working on the entrepreneurial activities, which help in
business activities, learning and diffusing of knowledge followed by using
guidance of search to carefully select how the resource is distributed by
creating space in the market with the help of good mobilization of resources as
well as gaining support from advocacy coalitions.


Moreover, when the particular innovation technology is
brought to a completely different region that doesn’t share the same
organization and structure as the native region where the technology was
developed, it is important to carefully adapt it by considering the various
functions from FIS defined by Van Alphen. Thus, a strong network needs to be
created by the various stakeholders followed by demand articulation to make
sure the technology fits the requirement established. There should be creation
of legitimacy and resource mobilization along with market formation, directed
by the governmental institutions to facilitate the adaptation and also
entrepreneurial activities which will confirm if the rest of the functions are
done in the right manner.




To conclude, it can be noted that, for any innovation
technology to succeed, it is of utmost importance to apply the FIS or SNM
frameworks. A choice between the two frameworks can be made depending on the
particularities required by each environment as mentioned before. A combination
of the two technologies is also a viable option, in cases where a broader
analysis is done from the rudimentary stage of the innovation till the very
final step of implementation.




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