Innovation plays a very important role in the private sector in terms of competitiveness, and is the key to success for private businesses, helping to cut costs, improve products and open new ...markets. Nowadays, innovation is gaining in importance in the public sector as well, as it can improve the quality of service delivery as well as reduce costs. Innovation is an important driver of economic progress and competitiveness in all economies. Collaboration between public and private entities creates better and more effective public and private services and products. Collaboration enables the participants to exchange and share knowledge, experiences, know-how and expertise. Collaboration helps to bring a broader set of skills and talents and a more responsive work culture into public sector organisations, along with innovative thinking and creativity; it also helps private companies to innovate more effectively and to achieve their concrete goals in a more efficient way. The objective of this paper is to outline the differences and similarities between private and public sector innovation in terms of definition, driving factors, barriers and measurement; the paper also aims to examine the importance of cross-sector collaboration for private and public sector innovation, and demonstrate that collaboration can improve innovation.
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