Abstract

Acknowledging the public sector’s remarkable innovation potential and several challenges hindering its innovation capability, this case study explores the impact of public sector innovation laboratory on innovation barriers of public health care. Findings are based on a Finnish hospital district’s innovation laboratory specialized as an authentic environment to develop novel technology and service solutions with various private sector partners. By altering the PSO’s approaches on interaction, commercialization, mutual learning and independence, the PSI laboratory proves especially influential in tackling innovation barriers related to complexity and organizational competences. Conversely, the lab’s impact on the barriers of risk-aversion and bureaucracy is lesser.