02What is an Innovation District and how does advanced manufacturing fit in?

Innovation Districts bring together leading research institutions such as universities and R&D companies with large firms and small start-ups in well connected, mixed-use, urban locations that are attractive places to live, work and play. In many countries, including the UK, this marks a shift away from the past few decades where companies chose to, or were encouraged to, locate in out-of-town business parks. Advanced R&D in particular was conducted in out-of-town science parks to enable firms to guard their intellectual property.¹ The Innovation District concept captures the emergent importance of the geography of innovation to the urban fabric.²

According to Katz and Julie Wagner, most Innovation Districts fit into three broad models or trends of development:

• “The ‘anchor plus’ model, primarily found in the downtowns and mid-towns of central cities, is where large scale mixed-use development is centred around major anchor institutions and a rich base of related firms, entrepreneurs and spin-off companies involved in the commercialization of innovation.”
• “The ‘re-imagined urban areas’ model, often found near or along historic waterfronts, is where industrial or warehouse districts are undergoing a physical and economic transformation to chart a new path of innovative growth. This change is powered, in part, by transit access, a historic building stock, and their proximity to downtowns in high rent cities, which is then supplemented with advanced research institutions and anchor companies.”
• “The third model, ‘urbanized science park,’ commonly found in suburban and exurban areas, is where traditionally isolated, sprawling areas of innovation are urbanizing through increased density and an infusion of new activities (including retail and restaurants) that are mixed as opposed to separated.”

In their report, the authors describe Innovation Districts as bringing together economic, physical and networking assets:

• Economic assets refer to the cultivators and drivers of innovation.
  • Innovation drivers are the universities, research centres, large firms and start-ups that develop cutting-edge products and services.
  • Innovation cultivators in turn support these activities and can be anything from a school or training centre (providing the skilled labour to innovation cultivators) to the lawyers and venture capital firms required to support innovation to market.
• Local amenities such as shops, restaurants, cultural amenities contribute to the overall ‘liveability’ that is central the mixed-use city centre quality of the Innovation District.
• Physical assets refer to the quality of the public realm in the Innovation District area, the quality of private realm within companies and campuses, but perhaps crucially, they also refer to the quality of the assets that link the Innovation District with the broader city and residential areas – including broadband, public transport, bicycle and pedestrian paths.
• Networking assets refer to the ties between people and companies in the Innovation District. These are the relationships that foster the cooperation and competition vital to innovation, especially in knowledge-intensive sectors.

The story of Innovation Districts is primarily one of change in the industrial structure of advanced economies: the decline of mass manufacturing, rise in professional and knowledge-intensive services as engines of growth and job creation, and related re-urbanisation trends. But some cities have maintained a position in manufacturing by specialising in advanced manufacturing, combining applied research and R&D to traditional industries and carving out competitive advantages in high-tech, bespoke and complex processes.

As this report shows, although the geography of innovation in advanced manufacturing is different to the Innovation Districts found in many cities, based on business, professional and financial services (BPFS) and creative and digital industries (CDI), the principles that underpin the concept of an Innovation District do seem to provide useful insights for thinking about innovation in advanced manufacturing as well. The next section provides more detail and context on the economy and advanced manufacturing sector in Sheffield-Rotherham.