In Context: the Global Innovation Index

In this article, Redvespa Senior Consultant Pam Wright introduces the Global Innovation Index (GII) and digs into New Zealand's recent performance: good and bad.

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For two decades, the focus of innovation has been measured by monitoring manufacturing industries and the innovation managed in-house by highly educated Research and Development teams.  

Today, the definition of innovation has increased beyond R&D and scientific studies. Among other things, social and business model innovation is now a key focus of innovation. In line with this, innovation is no longer seen solely as the output of incremental research. While not necessarily new - a classic example is the Hamilton jet boat, built from a desire to navigate shallow rapids and rivers rather than through scientific research - the breadth of innovation, its application, and the understanding of how it occurs is surging. 

As the definition of innovation continues to be expanded, the World Intellectual Property Organisation (WIPO) now include creativity and creative outputs in their definition, asserting that innovation and creativity are “two faces of the same coin.”

With WIPO behind the annual Global Innovation Index (GII), their agile approach to defining innovation is important in enabling them to determine the metrics which capture innovation. Improving the measurement of innovation helps WIPO to present, through the GII, a “more complete picture of innovation ecosystems and across the globe.”

‍The Global Innovation Index

First published in 2007 by INSEAD, one of the world’s largest graduate business schools, the Global Innovation Index (GII) is recognised as the world’s leading innovation study. 

INSEAD’s initial goals was to determine metrics for, and identify approaches to, innovation at a global level. In 2011, INSEAD joined with business partners, including the World Intellectual Property Organisation (WIPO), to release the GII. This partnership followed changes which added additional parameters intended to capture innovation happening in new markets and, more broadly, the impact of innovation on social welfare. The GII became more action-oriented through exposing innovation bottle necks and helping policymakers to overcome these bottle necks. 

In the 2024 edition of the GII, its ambition is described as,

“The goal of the Global Innovation Index (GII) is to be a holistic and flexible measure of the innovation happening all around the world today. To achieve this goal, the GII needs to go beyond capturing technological breakthroughs. It has also to account for the pioneering business models and social innovations driving positive change.”

Today, the GII is published annually by WIPO. It ranks world economies according to their innovation capabilities. Using roughly 80 indicators, grouped into innovation inputs and outputs, the GII scores and ranks 133 countries, including New Zealand.

‍The GII & New Zealand

When determining the top performing countries, the index measures countries by both region and economy. Countries are aligned with one of seven regions and one of the four levels of economy. Ranked at #25 overall last year, New Zealand is considered part of the Southern East Asia and Oceania region, and one of the High income economies. In 2024, the top five ranking countries all sit within the High income group and come from three of the seven regions.

Although the New Zealand Treasury determined that we were one of the first countries to feel the effect of the 2008 Global Financial Crisis (GFC), and one of the least impacted by it, we weren’t immune to the impacts as our GDP declined, house sales dropped, and job losses mounted. 

In spite of that, the GII reports around the GFC showcase two sides to New Zealand’s innovation ecosystem. The 2008-09 report, which opens noting a “tectonic shift” in the global economy, ranked New Zealand 27th out of 130 countries.

In contrast, INSEAD’s GII report for 2009-10 saw New Zealand with a barnstorming ranking of 9th. While it’s possible some changes to the report’s parameters helped boost our ranking, the government of the time was recognised for the “number of innovation initiatives” they had put in place in an attempt to boost the economy. In particular, our approach to Research & Development was called out, noted as being 50% lower than in Europe and the US.

That high out of the gloom of the GFC was the peak for our GII ranking. In 2024 our ranking was 25th. Over the last six years, our ranking has changed little, with a high of 24th (2022) and a low of 27th (2023).

In 2024 New Zealand’s highest rankings were in the pillars of Institutions (7th), Infrastructure (12th), Business Sophistication (20th), and Human Capital and Research (23rd). All of these pillars sit within the Innovation Input Index. 

In the Innovation Output Index New Zealand did not rank as highly, placing 45th in Knowledge and Technology outputs, 34th in Market Sophistication, and 31st in Creative outputs.

The depth and breadth of the information contained within the GII enables a thorough exploration of innovation inputs and outputs at a local level, in comparison to other nations featured in the GII, and alongside implemented and emerging initiatives. Ahead of the 2025 edition of the GII, we've started exploring how various industries are faring in the GII, and how the industries and government that support them are responding. Click the images below to explore.