This publication starts by introducing innovation systems diagnosis as a holistic method, and makes a distinction between three different perspectives on innovation systems: national, sectoral and local innovation systems, and then relates these insights to different kinds of value chains or sub-sectors.
This is followed by a detailed description of the important elements of innovation, technology and knowledge and their complex interactions. However, the focus in innovation systems is not on the elements, but on the dynamics, process and transformation of knowledge and learning into desired outputs within an adaptive and complex economic system. Thus the focus is less on the individual elements such as innovation within one or several firms, or on intellectual property rights, but more on the interaction between these elements. Along the way innovation is de-mystified, the definition of technology is broadened, and the importance of knowledge generated among and between actors is highlighted.