Frequently Asked Questions about the Innovation Cities™ Index 2021.
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Top Frequently Asked Questions
What is the Innovation Cities™ Index?
A city ranking designed to show which cities have the best general innovation conditions right now.
What impact has Covid-19 had on innovation?
Generally, in terms of the ranking this has not favoured some traditional winning cities. Hence, the index is volatile this year, and based on a shortened time window. Meaning rankings will be volatile into 2022 and 2023.
Impacts have been less to do with virus cases in many cities but rather: the lockdowns of cities, reduction in small /mid size enterprise economic activity in many cities, uncertainty/ fear, and rapidly changing public health procedures.
The economic impacts on GDP have been considered, as have population migrations, cases, deaths and the responsiveness of local government on the cultural and implementation aspects of innovation.
Generally, large physical assets have become less relevant (at least temporarily). This means hosting events on large conventions centres or the world's best art galleries has become temporarily less relevant in this index year. While arts and culture remain important in different ways, as they are forced to be 'digital' or some other form of interaction.
We have considered the broadest number of impacts for 500 cities.
If you would like to order any Covid-19 data, please contact us.
What impacts of Covid-19 have you included in this 2021 Index?
Digital Transformation - the need to perform many services digitally.
Deaths, Cases.
Mental Health.
Closures of spaces.
Public health response.
Reduced mobility.
Travel and trade (border closures).
And other pertinent impacts.
In your analysis, Covid-19 has (temporarily) favoured cities in which countries?
At this moment - China, USA, Japan, Egypt, Turkey, Vietnam, Australia & NZ (overall but NZ volatile for other reasons).
In your analysis, Covid-19 response has (hopefully temporarily) harmed cities in which countries?
Covid-19 response has harmed non-capital cities across Canada, Europe (UK, Germany, France especially), and all cities in Latin America.
How do we do the Index usually vs this year?
By scoring 500 cities annually on 162 City Indicators. Results are then classified into into 4 performance bands. Cities are then ranked against current global trends in the given year. In this year we have included some special algorithms to deal with Covid-19 impacts.
What are the 4 city classification performance bands?
All 500 cities are classified based on Index Scores into 4 (5 in 2015 and before) performance bands by score:
NEXUS: City is a critical nexus for large number of economic and social innovation segments, on an ongoing basis.
HUB: City has dominance on key economic and social innovation segments based on current global trends.
NODE: City has a strong performance across many innovation segments, with key imbalances or issues.
All developed cities should score in these top 3 bands. Emerging cities should aim to score in thee below band:
UPSTART: City has potential strong future performance, with some further improvement.
Not in 2021 we have reduced the number of cities in the bands. This is because no one is really performing at the same level as 2019, and this can be seen also in lower scores out of 60 at the top.
Cities that score below the Upstart band are not classified.
Why does a city need to develop innovation?
Cities with stronger conditions for innovation typically will display stronger correlations to jobs, lifestyle, economic development and favourable investment. They may also become more liveable or more desirable cities for residents and businesses. London, Vienna, Barcelona, New York, Boston all did well in our Indexes in past years, before rising in others.
Note, that without innovation, a city will not have the ability to boost productivity in response to overcoming the after effects of the Covid-19 'pandemic'.
So innovation remains critical to boost productivity.
Why the sudden changes in city rankings?
Very much a case by case answer. The reasons vary between the U.K. and Canadian cities for example.
As upside, many smaller 'unknown' cities have an unprecedented opportunity, afforded by the 'advantages' of large cities like London temporarily becoming disadvantages.
In a digital world, temporarily, you can work from anywhere.
Place still matters, so expect the big physical advantages to swing back into life soon.
What does a cities ranking or classification mean for me?
Cities that receive a higher rank or classification (NEXUS, HUB) are cities which are generally good places to develop innovation right now. These cities are usually broad-based high performers, with many good attributes.
Of course, this can change rapidly at the moment - due to Covid-19 measures.
So if you are a product manager or entrepreneur and have a broadly applicable market idea, go to these cities to launch.
If you work in these cities, you should be atttracting investment and opportunities whilst conditions are good.
If you are in international or national business, these cities have good conditions for general rolll outs. For example, we picked up Austin and Denver several years ago before they had a hot tech scene.
Innovation can lead economic development, so sometimes conditions for innovation show up before economies fully develop. Or, some cities such as Boston, Singapore or Munich have had sustained periods of innovation in multiple industries over many years (and past indexes).
What is the validity period of the ranking?
In 2021 this is a 1-year window due to the volatility - so NEXUS and HUB cities are the best for general innovation until 2022.
It's best to ask us for a custom analysis for your situation. At the moment it's highly volatile.
What about specific industries & innovation?
If you are targetting a specific industry for disruption (we classify all activitiy into 31 segments), then you need to purchase detaield data to drill down.
A city can be good at one or more segments (e.g. medicine or manufacturing) but not good enough at enough segments to score as Nexus or Hub.
Contact us, as we provide data as a service for the whole city, or to compare the city against industries or benchmarks.
What is the structure of the data behind the Innovation Cities™ Index?
The headline score out of 60 is based on a 3 factors score. These 3 factors map to the conditions for the development of innovation.
The 3 factors summarise 31 segments (or basically, industry and society areas).
The data for this originates with 162 City Indicators, designed by 2THINKNOW. The 162 indicators have benchmark scores calculated by special proprietary algorithms to measure performance. The 162 City Indicators are available to order for cities from 2THINKNOW.
The indicators are based on a large number of city-level Data Points. These Data Points available for order through City Benchmarking Data (request a data catalog at link).
Why is the Innovation Cities™ Index so different from other indexes and rankings?
We measure cities on a broad basis, and examining the cities pre-conditions our Index usually captures potential rises in cities before other Indexes.
What does it mean when a city suddenly declines?
Two points to note. This can be temporary. We track a 5 year pre-covid 19 average and show the cities decline or rise relative to that.
And, second each year the relative importance of indicators changes. In 2021, there were many many changes. Hence, it took a long time to finalise what started out as the 2020 Index. This also tends to happen in a cycle of approx 7-9 years in any case, as this is a cycle where the world changes direction. Covid-19 exacerbated this cycle.
Declines show a city is not as prepared for the current trends it may be facing in our data analysis.
I am a journalist, can you provide resources?
Email media@2thinknow.com for any requests such as interviews, or further resources including more detailed 3 Factor rankings in Excel.
What is the basis of the Innovation Cities™ Index city ranking calculations?
2thinknow Research & Development in the area of data science & algorithms. Data science & algorithms are based on assessing innovation pre-conditions via examining 162 indicators (that use 1000+ data points), which are benchmarked and converted to 3 factor scores using 2thinknow's model.
In research, we use theories from micro-economics, behavioural economics, game theory, data science, psychology and a whole clutch of cross-silo disciplines.
The Innovation Cities Index works by identifying the pre-conditions for innovation in each city, and measuring these pre-conditions through a 3 factor score based on 2thinknow's extensive City Benchmarking Data set of 162 indicators, using the latest data science and analysis developed by 2thinknow R&D, since 2007.
I wish to compare multiple cities on multiple data areas (livability, cost of living, transport, etc)
Visit City Benchmarking Data (request a data catalog at link). Or just contact us with your data requirements for a Proposal.
Anything (almost) is possible, and we have done data/analysis location comparison projects successfully for a number of large companies including Samsung, Ernst & Young, Savills, Deloitte and a number of corporations and governments. Simply contact us.
Do you provide access to the whole city data set?
No. We provide access to a selection of data points and a selection of cities.
Contact us for a full Proposal based on whatever data you need.
Our pricing is very competitive compared to the non-specialised management consulting firms, due to our specialization and knowhow.
We would like to in future license the whole data-set to a corporate partner in return for investment.
I want to answer a specific research question, or make my own ranking?
Therefore it is best to create business or product innovation in a city with the highest relative performance within your constraints (such as language, culture, industry, etc). Before making a decision you should request detailed Comparative City Data on a generally select sub set of cities that meet your basic criteria.
Where can I get a geeky explanation of the rationale behind the Index?
Here's the full set of online methodology, including this FAQ and previous ones.