Innovation Cities Index 2012-2013 FAQ

Frequently Asked Questions about the 2012-2013 Indexes

What is the index and how does the index classify cities?

The Innovation Cities Global Index classifies 445 benchmark cities across all populated regions into 5 classifications. 133 cities (the top 30%) are ranked by analysts.

How are the global and regional city indexes classified?

All benchmark cities are classified based on Index Scores into 5 classifications:

NEXUS: Critical nexus for multiple economic and social innovation segments

HUB: Dominance or influence on key economic and social innovation segments , based on global rends

NODE: Broad performance across many innovation segments, with key imbalances

INFLUENCER: Competitive in some segments, potential or imbalanced

UPSTART: Potential steps towards relative future performance in a few innovation segments.

Cities that score below Upstart band are classified as unranked.

How do I use the index for innovation?

The Index is designed to help innovators determine which cities are generally the best places to start innovating in a given year.

Both Nexus and Hub cities are recommended as general innovation destinations given other factors such as the culture (e.g. if you are Spanish you may need a Spanish location).

If you are already in a country another city in that country may increase your innovation possibilities.

What about if I am in a city classified poorly for innovation?

It is still possible to innovate, but that innovation is more likely to have what we term a 'reach' of regional or local. It is less likely to become a global product, process, service or other innovation with global impact.

If you want to innovate within your country seek the best location in your country or a neighbouring country. In many cases migration patterns follow this logic, as people seek to improve their economic wellbeing by the risky activity of migration.

So what does this mean for ideas?

Ideas are viruses (as Seth Godin argued recently, but was more academically argued by Stanford's Professor Everett Rodgers in Diffusion of Innovations). Viruses need a transmission network.

2thinknow map the data that tracks transmission of ideas into innovation as a structured process (not a random fad).

Can my ideas become innovation?

Yes. Not all ideas are possible, but the right ideas at the he right time can become actual innovation. We map how.

Which cities are best for general (non industry specific) innovation?

Nexus cities are the best general innovation destinations across the broadest range of industry segments.

Hub cities have a slightly smaller range of segments in which they have innovation potential.

Node cities are globally competitive, but results will vary greatly depending on your industry.

I need to know about a specific industry for innovation, how can I find out?

The detailed underlying data of 162 standard indicators, and further custom indicators can answer any research question you may have on an industry in any city. This is Comparative City Data-set.

I need to know the pluses/minuses of a location for business investment, how can I?

Request Comparative City Data-set or a City Data Audit

What is the data basis of the Index?

2thinknow analysts update a City Benchmarking Data set of 162 indicators. Each indicator contains a band score based on a set of a mix of data points from a wide variety of sources. Across the full data-set there are over 5000 sources at the time of publication. The band scores are standardized comparisons between cities that may otherwise be very different due to culture, location, population, etc.

Our analysts consult these standardized 162 indicators of data to form the 3 factor scores you see in the Index.

How many cities does your underlying indicator data cover?

The City Benchmarking Data covers 445+ cities for 162 indicators at this time of publication. Other data is available for the remaining 1100 cities we track, which will be added to the Index each year.

What are the cities scores?

The cities in the free Index all receive a 3 factor summary score, for Cultural Assets, Human Infrastructure and Networked Markets. In 2012-2013 these are scored out of 20, in previous years out of 10.

3 factor scores published are based on 162 standardized indicators of the City Benchmarking Data-set consulted by our analysts, which are correlated to each of the 3 factors.

Is there any difference between 2011 cities and 2012 cities?

Yes. Data obtained up to 2011 has been through more cycles in our data-set (cities such as Paris have been through more 8 cycles in total, and many partial cycles) have the greatest confidence. If you compare the 4 year

How do city Rankings vary from year to year?

Data shows the strengths (and weaknesses) of cities. These are adjusted for current trends (e.g. manufacturing cities may do well in certain years, less well in others).

This is why a diversified and appropriately structured city will perform well over time in the Index (and will perform well in innovation over time). A more focused city may do well in only a few years.

Economic events shift the Index (eg. GFC 2008+ created downward momentum in cities on periphery of Europe).

Are there any estimates in the data?

Newer 2012-2013 cities will include more estimates. Cities in China, Asia and Emerging markets include more estimates. The score for Kabul is wholly estimated based on available information.

Will new 2012-2013 cities vary next year?

This depends on trends, or wars, natural disasters, etc in emerging countries for example. Some better data may improve an Index score (or occoccasionally reduce a score). Cities tend to be scored conservatively first year published unless there is a compelling data / analysis reason.

Are any cities scores withheld?

Some cities are not yet published where we feel we are not confident in the range of possible scores.

What do the 3 Factors mean?

The 3 factor scores for each city are:

Cultural Assets: Measurable sources of ideas (e.g. designers, art galleries, sports, museums, dance, nature, etc)

Human Infrastructure: Soft and hard infrastructure to implement innovation (transport, universities, business, venture capital, office space, government, technology, etc.)

Networked Markets: Basic conditions and connections for innovation (location, military, economies of related entities etc)

How do the 3 factors relate to innovation?

These 3 factors measure the preconditions for turning an innovative idea into an implemented successful global (or regional) innovation, using the 2thinknow Innovation Development Life Cycle model developed in 2006-7.

In short ideas implementation and communication with a 4th phase used to assess feasibility. This model is taught in the Innovation Course for business and cities and has been published since the 2007 edition of our report.

How does this Innovation Development Life Cycle model work?

The idea allows you to turn your idea into innovation with a structured process, and is unique to 2thinknow.

In 2012 my city is a Nexus, why is this important?

Nexus cities have a high probability of from pre-conditions to create innovation not just in science, but in areas such as product, process, business, service, policy and other types of innovation. That is because the have strengths in multiple segments of their innovation economy.

So if you were looking for a strong city to create innovation in general, Nexus cities are the best choice -- unless you have specific research question.

What is the difference in the top ranked cities?

The top ranked cities are the best choice for innovation. In our view cities like Boston, New York, San Francisco, Vienna, Munich, Paris are all good choices depending on speaking English, German, French (and other factors)

Can I examine the Index by country?

Do Nexus cities change much from year to year? Are there typical Nexus cities?

Cities such as Paris, Boston, San Francisco, Amsterdam and New York will typically always be Nexus cities. Trends support the movement of other cities up or down, and in and out of Nexus cities.

Can a Nexus ever become a Node?

A Nexus city is likely to fall below Hub status. So a Nexus is unlikely to become Node except in the case of extreme events such as war or major long term disaster.

What are the top city rankings?

The Innovation Cities Index ranks the top cities in the world after classifying their potential as innovation economies. In 2012-13 the top Nexus cities (10% of all benchmark cities) and Hub cities (next 20%).

My city has become a Nexus from Hub what does that mean?

This means our analysis is that your city has become a city with increased innovation potential in a broad variety of segments compare with all other competing cities. Nexus cities have more innovation potential in a broader range of 31 segments.

Where are the 31 segments?

You can examine the 31 segments here. The 31 segments cover all major industries and community activity areas.

A city has fallen from Nexus to Hub this year, what does that mean?

This means that in general based on favorable industries and trends in 2012-2014 the city is slightly less favoured for general innovation than it was in 2011.

Some cities have had sudden falls, why?

Italian and Southern European cities have fallen relative to peers, and relative to their past potential. Some cities such as Barcelona and Milan still retain opportunity at the local level, unless the national situation further deteriorates into political chaos.

Do you change the rankings a lot from year to year?

We change in reflection of current trends.

My city has changed in the global rankings should this matter?

You should look at the Index Score/divide by 2, and compare to previous years. Significant falls do matter, especially with the current instability in locations as diverse as North Korea, Spain, Greece, Italy and abroad. Even countries like Australia have weak governments of opposing coalitions, and historically, this has proved troubling for short, mid and long term innovation.

My city is a Hub city, is this less important than a Nexus City?

No. Hub cities have competencies in slightly fewer sectors, and may be dominated by fewer industry and community segments. Cities that focus on a few key industries tend to become hubs (or even nodes).

Which city is right for you depends on the industry you are in, and your cultural background.

My city is a Node City, what does this mean?

Node means globally competitive for some types of innovation. These cities are a good bet, unless you have a better Hub or Nexus option -- or if the Node city has a strength in your particular industry.

If a city is not listed, what does this mean?

The city is classified as a Node city or below in this year, all cities that wold be score well enough to reach Nexus status and Hub status are captured, and in 2013 once again there are no omitted Hub Cities.

If you would like an indicative idea, look at similar geographic and economic cities in your region or country.

Can I get data on any city?

You can ask for a City Data Audit on ANY city, even those not listed. This includes 1540 cities globally. If there are any omissions we

Are some cities included within other cities?

Yes, for the Index purposes, we include the surrounding suburbs or smaller metros in cities. The normal zone is based on government Metro zones.

Is the 2thinknow city index the largest?

Yes. We create the largest index classification of 445 benchmark cities and ranking top 133 cities worldwide, using 162 indicators.

What is a ‘good performance’ for a city?

A good performance is a node city. We classify this as competitive.

A node city may be perceived as better by residents than the residents of cities who may have higher expectations.

A node city can still dominate a single industry segment, and in fact that is often how node cities become hub cities.

Why do you include more indicators than other indexes?

We include 162 standard indicators. We are producing an overall city index score for all 445 cities and ranking of top cities.

There are 39 indicators in Mercer. Some indexes have 5 indicators. Ours is more about a balanced economy for innovation across many sectors.

How many cities do you include?

If you’ve read this far you know it’s 445. We have a city benchmarking data-set of 1,540 cities.

Each year our analysts include more cities based on continually improved data, and process.

How do your analysts select cities?

Cities selected from a list of 1,540 cities based on health, wealth and other core factors. This includes GDP per capita and infant mortality among other base factors. In the case of emerging markets this may be relative to ensure a geographic representation.

Besides the global index, what other indexes are there?

There are 4 regional indexes for Americas, Europe, Asia and Emerging are extracted from global index.

We also have reproduced the top ranked cities in what are termed Sub Regions, which is a further sub division of the world into geographical divisions.

Can I reproduce the indexes or top rankings?

Yes. As long as you attribute them correctly and don’t change their integrity. To be safe, read the reproduction paragraph under each index for clear instructions.

What are the differences from previous years?

The trend analysis underlying the rankings is different - U.S. cities will tend to do better reflecting macro economic trends.

We also have raised the summary score of 3 factors to a baseline of 20 per factor, not 10 per factor. This means the Index score is from a maximum possible score of 60, rather than 30, making the differentiation between cities. This reflects improvements in underlying methodology each year.

Why are nexus cities the best all-round destinations for innovation?

The nexus cities have the most balanced performance across multiple sectors of the economy. If you are not sure which sector of the economy you want, these are the cities. These cities tend to balance livability with opportunity.

Hub cities have a wide variety of opportunities across more than one segment or sector.

Where can I get an overview of the Innovation Cities™ Framework?

The Innovation Cities™ Framework is the centrepiece of the Innovation Cities™ Analysis Report

The report gives the context of measuring urban innovation economies, summarizes each segment and city indicator. It’s a low-cost introduction. There are excerpts and tables of contents on the above site.

Is the Innovation Cities™ Analysis Report about specific cities?

Many cities are profiled in the Innovation Cities™ Analysis Report, however, it’s purpose is to outline a framework and elements you may need to build an urban innovation economy.

How do I get a detailed report on a specific city?

You can order a detailed City Data Audit on any city from 2thinknow. This includes 162 city indicators of data, with evidence for each score, a variety of goodies.

You can also commission a custom written report with analyst commentary – contact us.

How are cities selected for inclusion?

The cities are selected based on demographic, geographic, economic, health and social factors from a list of 1,540 cities.

To ensure a global mix of cities, we then select a set number of cities from different nations with potential for innovation.

Is there a media release?

Yes. Our media release is provided with each index and headline rankings for use by media of all kinds.

Can you do an interview?

Yes. We prefer email interviews, but have also done skype interviews. Contact us or email media@2thinknow.com