Innovation Cities™ Index 2015 & 2014 FAQ

Frequently Asked Questions about the 2015 & 2014 Indexes.

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Index General Questions

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What is the Innovation Cities™ Index?

The Index is a classification designed to help you determine which cities are the best places to start innovation in a given year.

How does it work?

The Innovation Cities™ Index classifies 500 cities in 2015 across all populated regions into 5 classifications. In 2014 this was 445 cities.

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.

What are the 2015 & 2014 classifications?

All cities are classified based on Index Scores into 5 classifications 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 these 2 bands:

INFLUENCER: City is competitive in some segments, but is out of balance on many segments.

UPSTART: City has potential strong future performance, with some further improvement.

Cities that score below the Upstart band are not classified as they scored below a 50% possible score.

What does the ranking of cities mean?

The ranking of each city is based on 2thinknow detailed analysis of each cities underlying data. Rankings are the fun stuff, but classifications are what really matter. Rankings are more telling at the top of a list than the bottom, also as the ranking represents 2thinknow’s view on the best places to innovate.

What is the New Starters 2015 list?

It’s a list of 58 new cities at Node level or below, that are added to the Index. These 2thinknow think have potential, and have made the list on their interest and merits.

All Hub and Nexus cities are already in the Index since 2012-2013. There are 442 cities from 2014 in the 2015 index.

How do I use the Indexes for my 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.

If you want specific guidance regarding your city and the Innovation Cities Index, please purchase a cities package with email support.

If you want to compare cities, purchase detailed Comparative City Data from City Benchmarking Data.

Have there been any corrections to Innovation Cities Index 2015?

Yes, the publication tables had 3 errors in them. The 3 differences between the original release in December 2015 and March 31st 2016 are as follows:

For the following cities scores were updated to correct publication errors:

Sheffield score has been corrected (-1 point). Buenos Aires and Bogota score have been corrected (+1 point).

Generally we only correct errors. In this case we corrected the error in the scores, the ranks are not changed. The ranks were correct.

These have been corrected in the official report as at 2nd April 2016, and will shortly be corrected in all online information.

There were also some errors in the reproduction (not content) of the Asia region tables these will be corrected at the same time.

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.

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.

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 2014/2015 these are scored out of 20, in previous years out of 10.

3 factor scores published are based on the 162 standardized indicators of the City Benchmarking Data-set consulted by our analysts. Each of the indicators match 31 segments, which summarized into 3 factor scores for the Innovation Cities™ Index.

The relationship between 3 factors, 31 segments, 162 indicators and the underlying data points are explained over on our City Benchmarking Data site Data page.

3 Factors scores for the current year are contained in print form within the report and all of the packages in Excel form. For 3 factor data on cities since 2007, please purchase a Bronze or other package All packages come with email support.

For detailed 162 indicator data on one city consider a Single City Data-set or Silver or Platinum Package.

Where can I get an explanation of the rational behind the Index?

Click for a brief overview of 2015 & 2014 methodology as well as this FAQ.

For urban professionals, a detailed practical foundation purchase this year’s Innovation Cities Analysis Report — which you can order online here as print, standard (PDF + print) or slide format.

For cities, the best option is one of our packages available for online order or invoice. Monthly plans available upon request.

How are the Index city rankings done based on score ?

Analysts compare cities with the same 3 factor scores and competitively rank them based on their current performance within their band. Every city with the same 3 factor score may have relative strengths and weaknesses related to current trends — e.g. technical innovation may be more important than medical in a given year, or vice versa.

The classification is more important than the ranking, all things being equal. Since 2014 all cities are now ranked (up from 30% in prior years).

Where can I read more about City Benchmarking Data?

Take a look at the dedicated City Benchmarking Data product site, especially the Data page — explaining how factors, segment, indicators, benchmark scores and data points capture information about cities, and allow easy comparison in the 2thinknow model.

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 a great choice — unless you have specific industry in mind.

Besides the global index, what other indexes are there?

There are 4 regional indexes for Americas, Europe, Asia and Emerging are extracted from the main Global index. We also have this year for the first time released the full rankings of cities in what are termed Sub Regions, which is a further sub division of the world into geographical divisions. These sub regions that reflect the major socio-economic groupings globally.

Data

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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 can data be purchased?

The 3 Factor scores are available to all report purchasers or package subscribers.

The underlying 162 Indicators data and benchmark scores is available for purchase for one city in a Single City Data-set or Silver or Platinum Package.

Detailed Comparative City data-sets of a mix of selected cities from our list and selected standard Indicators is available to order via a Proposal. Contact us.

Our City Benchmarking Data site explains our commercial cities data-set consulted to produce the Index each year

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. Contact us for a Proposal for data or an analyst report.

How many cities does your underlying indicator data cover?

The City Benchmarking Data covers 500 cities for 162 indicators at this time of publication (2015). Other data is available for the remaining 1200+ cities we track some data on, some of which will be added to the Index in future years. The Indicators are designed so that even in the absence of perfect underlying data-sets a accurate opinion of performance of a city can be formed. This is especially useful in emerging markets or even large portions of Asia where data is scarce. It is also useful to benchmark U.S. cities (where data is plentiful for some indicators) against competing world cities to identify comparable investment opportunities in locations anywhere.

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

Purchase a Single City Data-set or a complete Silver / Platinum Package containing all the detailed data for 162 indicators on a single city. Packages contain additional innovation resources.

I wish to compare multiple cities on multiple data areas (livability, cost of living, transport, etc)

Request Comparative City Data-set 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, Ogilvy and a number of corporations and governments. Simply Contact Us.

Do you sell the whole City Benchmarking Data Set?

No. We sell access as Single City Data-set for single cities. Or Comparative Data-set — collections of comparative indicators for selected cities. We also prepare custom data projects of any data points for any cities and/or analysis for clients like Samsung, Ernst & Young, Ogilvy, BCG and others. 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.

Package Subscribers

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How do I get access to the Innovation Cities Index before others?

2thinknow offers 3 Innovation Cities Service Packages: Bronze, Silver and Platinum. All subscribers of the packages can in 2016 (upon request) get access to the Index roughly 7-14 days before release. Please click here for more information about the city packages.

Are there any benefits for package subscribers related to the Index?

Yes. There are many benefits for the package subscribers. In addition to the complete data set for your city, you can get analyst explanation of the index for your city. Package subscribers also receive substantial discounts on training and services that can build your cities urban innovation economy. If you understand the Index better than the others, your city will innovate better than the others!

Can I get data on any city?

When you subscribe for any of the Silver or Platinum Package, you can ask for a Single City Data-set [SCD] on ANY city, even those not listed. This includes 1670 cities globally. The 500 cities will be provided more quickly, however, SCDs can be prepared on any city globally. All cities are benchmark scored against our core 500 city data set in 2015 onwards. Our pricing is very competitive compared to the non-specialised management consulting firms, due to our specialization and knowhow. Contact Us for a full Proposal based on whatever data you need.

Previous Years

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Is there any difference between cities included in earlier years?

Yes. Data obtained up to 2012-13 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. We adjust the underlying data each year, so 3 factor data is less likely to vary for stable cities that have been in the Index for some time (except due to war, economic disruption, external events, etc).

Each year we improve the process, and we in 2014-2015 are close to working through the final Index Process.

Can I purchase historical 3 factor Index data?

Bronze package holders receive detailed 3 factor data for all years since 2007.

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). We are working on new ways to use our unique trend insights in future Indexes.

Can I purchase historical indicator data?

No right now. We are planning to release a historical indicator product in future.

Ongoing improvements to the data-set mean that for past data it is rarely an apples to apples comparison — e.g. our transition from qualitative to quantitative data points underway at current. The Indexes are not effected as they are based on a snapshot of the data reduced to a 3 factor score. Issues are practically eliminate by the granularity design of our data from factors down to data points.

Once our data systems undergo further design upgrades to cope with the process we will offer historical data going forward.

Are there any estimates in each year of the Index?

Newer cities added in 2012 onwards will include more estimates. Cities in China, Asia and Emerging markets include more estimates. E.g. the score for Kabul is wholly estimated based on available information. We are confident of the range of possible scores.

Are any cities scores withheld?

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

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

Cities such as Paris, Boston, San Francisco, Amsterdam, London and New York will typically under current methodology always be Nexus cities. Trends support the movement of other cities up or down, and in and out of Nexus cities. London has rapidly advanced as a Nexus, based on the negative position of London in earlier versions of the Index. Smaller or less connected cities may move in and out of Nexus based on their government, business and community choices.

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.

Models & Methods

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What is the 31 segments model?

The 31 segments cover all major industries and community activity areas of any urban economy. 2thinknow analysts use these to analyse the urban innovation economy. You can review the 31 segments here.

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). 2thinknow have mapped the process of idea communication and adoption as a process of innovation. Part of this process can be overlayed onto mapping the pre-conditions for innovation via the 3 Factors. i.e. How possible is it for ideas to become innovations as a structured process, in a given location.

What are the 3 Factors?

The 3 Factors of the Innovation Cities™ Framework are explained in detail regarding cities in our accompanying report. For an explanation of how this relates to our city data click here.

How do Factors, Segments and Indicators link together?

This is explained in brief in the City Benchmarking Data site here. Each level has strategic benefits in analysis and understanding a city.

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 of course the industry profile of each city (for which you need detailed indicators or data points). Segment  analysis can explain what strengths a city has.

Can I examine the Index by country?

You can download a basic excel file here for easy analysis. Report purchasers or package subscribers receive more detailed data.

City Government

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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.

How many cities do you include?

500 cities in 2015, 445 cities in 2014, less in previous years.

We have a city benchmarking data-set of 1,600+ cities in total for which we track some data.  Cities are selected from a list of 1,540 cities based on health, wealth and other core factors. This includes population, GDP, GDP per capita and infant mortality among other base factors. This may be relative to ensure a geographic representation using our proprietary model for ensuing some cities in each region are represented.

How can my city improve it’s classification or ranking?

Obviously the lower your relative ranking, the further improvement can be made. The Index is inherently conservative, so some cities will move up in some years due to corrections to underlying data based on superior evidence being located.

Does my city need to submit data to the Innovation Cities Index?

 Our Index does not rely on data submitted by cities, except where they have published statistics or data on their own websites or in publications.

The Index is currently prepared with data gathered by 2thinknow in the form of 162 indicators and our internal analysis. This is based on data in a mix of locations and languages from over 5,000 sources and standardized.

Cities that purchase a Silver or Platinum service package can view our detailed standard indicators data and suggest changes or corrections based on superior evidence.

Can we mail you information?

2thinknow have a library. Cities and organizations are free to mail us DVD/CD-Roms of data, or printed materials, books, journals to be added to our library.

Mail to: 2THINKNOW, Innovation Cities Program, GPO Box 3375, Melbourne VIC, AUSTRALIA 3001.

Information can be emailed however due to the large volume of emails received we prefer physical media. Excel, Word, PowerPoint, PDF or Kindle formats accepted electronically.

Can I submit data to the Innovation Cities Index/City Benchmarking Data?

Anyone can Contact Us and make a suggestion. Cities that purchase a Silver or Platinum service package

How can another city rise when I think my city is better?

2thinknow analysts take a detached rational view of cities and try not to be swayed by temporary issues and problems. Rather than have the Index radically change from year to year we take a look at mid (2-7 years) and long term (7 years+) trends as part of the ranking cities.

Whilst say a city may score artificially high on one measure due to manipulation, to improve in our Index cities can score better by small improvements in many indicators.

Why do some cities rise despite problems?

In the case of emerging or non-Western locations or cities with less public data, we may have obtained better information about the city. One of the primary ways a city can rise in the Index is if better information is obtained. We will always use the best available information, which reflects our bias towards rational information from diverse sources to analyse cities.

So even if the trend is down, better evidence may cause a rise especially in areas where information is difficult to obtain.

A city has changed to a lower classification this year, what does that mean?

This means that in general based on favorable industries and trends in 2014-2017 the city is slightly less favoured for general innovation than it was in 2013.

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. There are some considerations where cities may be corrected based on better evidence, or one-off events (e.g. bank failures and related data in the past knocked down some cities in the USA).

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.

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.

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 all years 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.

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 500 benchmark cities (2015) and 445 cities (2014) and ranking of top 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.

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.

Why do you include more indicators than other indexes?

We consult 162 standard indicators. We are producing an overall city index score for all all 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 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.

Cities that work with 2thinknow as package customers may be included ahead of similar size cities as we have more data for these cities. So for some cities we may accelerate the timeline for listing. It is unlikely however that such cities would enter the index above the Node status — which is the central position for cities.

Innovation Cities™ Analysis Report

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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.

What else is important in the Report?

In each report we make predictions about the immediate future of the world, and recommendations on high level actions and possible world events. So far we have predicted the climate of the GFC, the strength of the German economy, U.S. economic issues, the circumstances for the Ukraine crisis. Significantly we have also made very few errors compared with the many reports published by larger firms. We also hold a quite contrarian view to mainstream commentary.

The predictions come primarily from the City Benchmarking Data, and change trend and innovation models of Christopher Hire, our Executive Director.

These analysis are clearly stated and are used to prepare the final comparative Innovation Cities™ rankings.

How do I purchase the Innovation Cities Analysis Report?

You can purchase this year’s Innovation Cities Analysis Report — order online here as print, standard (PDF + print) or slide format.

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. The 3 factor scores for all cities are included in the report.

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

You can order a detailed single city data-set 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.

Media

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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 I reproduce the indexes or top rankings?

Yes. As long as you attribute them correctly and don’t change their integrity.

Can you send me a 3 factor file for graphics?

Yes. The 3 factors can be used to create graphs/charts for features. Contact us or email media@2thinknow.com.

Can you do an interview?

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

Will you help out my blog

You can publish our Media Release and send us some quick questions. Not too many though.

Do you accept all interviews?

Please note we only do interviews for genuine publications or blogs, and not for those seeking to gather information for other purposes. We refuse interviews for some websites, and this includes those who seem to be posing as journalists. Please provide your publication name and email address at your publication or other proof you are a journalist (even a cadet is ok, we just don’t like people from intelligence services who pretend to be journalists to get free information).

Future Indexes

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When will the next Index be published?

The Innovation Cities Index is annual index. Note that we will update this from time to time on this website.

How can I include my city in the next year’s Index?

Any city can request to be included. However, the main cities by population, connections and economic contribution are already included. More cities will be included in future automaticaly based on our internal geographic and economic distribution process.

To fast track inclusion, any city can purchase a City Review Visit (price varies by location) or a Platinum Package. These packages ensure your city will be reviewed more rapidly and comprehensively, and guarantees your inclusion in the next Index year.

Will new 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 occasionally reduce a score). Cities tend to be scored conservatively first year published unless there is a compelling data / analysis  reason.

Why are Nexus cities the best all-round destinations for future 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.

We recommend detailed City Benchmarking Data for each city — including data in the segments you wish to invest in.