Frequently Asked Questions about the Innovation Cities™ Index 2022-2023.
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Top Frequently Asked Questions
What is the Innovation Cities™ Index?
A 500 city ranking showing which cities have the best pre-conditions for innovation right now.
Innovation correlates to higher economic growth measured in GDP per capita, or lower rates of unemployment. Generally more innovative cities are regarded as better, more desirable places to live and work.
If you work in city or regional government, and would like a free presentation on 'Innovation and Economic Growth' please reach out.
How can my City Government better use the ranking?
The best way to understand the Innovation Cities™ Index is to order a package. This contains headline data-sets (not each indicator) over 10 years, presentations, videos, presentations on your city, training aids, guides plus an explanatory video training session with Q&A. All of this is commercial in confidence. Thus, this valuable information is not available elsewhere.
All the information you need to understand the city rankings - and what they mean for you.
Information on this offer here.
We have limited to no budget? Help!
If you have limited budget - a lot slower but lower budget way to understand is to subscribe as a Cities Innovator Member (founding) to our Substack. This is a paid subscription.
For no budget at all - (Free tier annual subscriptions just cover highlights so are more to get you started.) You will also get annual updates on publicly available information for free.
We mainly rely on data sales and resource sales to support the research. Thus of course our clients access more information.
Does Covid-19 continue to impact urban innovation in 2023?
Covid-19 measures like lockdowns significantly impacted results in 2021. This, fortunately is somewhat receding now. Ending of Covid-19 measures means large convention centres or the world's best art galleries have once again become more relevant. Arts and culture are more important in 2023 again. Yet 'digital' or some other form of online interaction remains critical.
If you would like to order any Covid-19 data, please contact us.
What impacts of Covid-19 have you included in this 2022-2023 Index?
Most have been removed, however, we have retained a focus on digitalisation, work from home (still broadly popular) and other practical aspects.
What is the global state of innovation in 2023?
Generally, there is a global weakness in innovation, despite stronger individual performances. This was similar in 2021. The level of weakness has been increasing. There is a 'same same' effort in some areas, as the 'selected many' are often favoured above 'the innovative few'.
How do we do the Index this year?
By scoring 500 cities annually on 162 City Indicators from this list (as in most years). Results are then classified into into 4 city performance bands. Cities are then ranked against current global trends in the given year. The prior 2021 special algorithms to deal with Covid-19 impacts have little effect in 2023.
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 2023 we have varied the number of cities in the bands.
Cities that score below the Upstart band are not classified. This is signified by a blank or a zero in that column.
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.
There is a direct correlation between a high innovation rank and higher rates of GDP per capita, and lower rates of unemployment on a regional basis. e.g. cities in the U.S. with higher innovation rankings, have much higher rates of GDP per capita. This means more wealth.
Note, that without innovation, a city will not have had the ability to boost productivity in response to overcoming the after effects of the Covid-19 'pandemic'.
So, innovation remains critical to boost productivity.
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.
So if you are a product manager or entrepreneur and have a broadly applicable market idea, go to these cities to launch.
If you want great certainty use the cities '5 year average' ranking vs competing cities as a differentiator.
Of course, if you work with 2THINKNOW we have a great variety of internal metrics we can share. These metrics will provide a solid basis to make better, more informed decisions.
In 2023 what does the data say I should do?
If you work in these cities, you should be attracting investment and opportunities whilst conditions are good. Foreign currency (USD, for example) may be useful.
If you are in international or national business, fast rising cities have good conditions for general roll outs at a lower cost. Cities with a relatively high 5 year average in your region are a safe bet.
Whats the link between innovation policy and innovation?
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). Singapore has remained almost perfectly steady in the index at 5th (top 1%) through strong innovation policy.
2thinknow have specific case studies and ideas we can share with our clients.
What is the validity period of the ranking?
In 2023 this is a 2-year window due to inflationary volatility - so NEXUS and HUB cities are the best for general innovation until end of 2024. (excluding a bank run or banking collapse).
Otherwise, it is best to ask us for a custom analysis for your situation. At the moment it remains volatile.
What about specific industries & innovation?
2thinknow classify all activity into 31 industries/government portfolios. Each indicator lines up with one of the 31 areas. If you are targeting a specific industry for disruption then you need to purchase detailed benchmarking reports or data to drill down into 1 or more indicators.
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 industry and government areas. (We don't generally differentiate who manages what, as this may vary).
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.
Why is the Innovation Cities™ Index so different from other indexes and rankings?
Examining the cities pre-conditions our Index usually captures potential rises in cities before other Indexes.
The broad-base of the indicator range makes it harder to manipulate results.
The index has been published for a long time (since 2007, modern version since 2012). This makes it longitudinally somewhat comparable.
We cover 500 cities making us the largest or among the largest.
We run a large number of model runs, to get a final result. We spend more time and effort than most other city rankings, and specialise in it.
What does it mean when a city suddenly declines or rises?
Two points to note. This can be temporary. We track a 5-year average and show the cities decline or rise relative to that.
And, second each year the relative importance of indicators changes.
So, declines show a city is not as prepared for the current trends it may be facing in our data analysis.
This could vary in the following year, or over the long term of 5, 8 or 10 year averages.
I am a journalist, can you provide resources?
Email media AT 2thinknow DOT 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 have 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, for each indicator and the model 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 Economist, 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 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.