Transcript Slide 1

The changing face of
innovation policy
Programme on Regional Innovation
University of Cambridge
Belfast,17 June 2010
PLEASE DO NOT QUOTE
WITHOUT PERMISSION
The changing face of innovation
policy
• Innovation: the conventional wisdom
• A new framework for innovation policy
Map of GDP?
Regional Innovation Scoreboard (RIS) 2009
High innovators
Medium-high innovators
Average innovators
Medium-low innovators
Low innovators
Source: RIS (2009)
Innovation: the conventional
wisdom
• The importance of high technology manufacturing
• The importance of R&D
• Importance of corporate laboratories and
protecting IP
• The role of Universities
– Technology transfer
– Low level of university-business collaborations
in the UK
Innovation and growth: the (Solow)
paradox
• “You can see the computer age everywhere
these days, except in the productivity
statistics". Robert Solow, 1987, (MIT, Nobel
Laureate)
• Economic growth is not apparently correlated
with innovation
The Innovation (Solow) paradox
• Answer?
– Innovation takes time to have a major
impact on economic growth.
• Why?
– It is the use of technology not the
generation of technology that has the
biggest impact on growth
The innovation (Solow) paradox
• US Productivity growth 1995-2000: the three largest
contributors to the productivity surge were, in order:
– wholesale trade
– retail trade
– security and commodity brokers
(Solow, CMI Summit 2001)
Bentonville AR.
Innovation: how important is
R&D?
‘This country’s success ultimately depends on a
strong skills base and dynamic R&D both driving an
innovative and competitive economy...... The
Government will continue to play its part by
stimulating R&D investment. The recent changes to
the Research and Development Tax Credit, for
example, will bring additional benefits to small,
medium and large companies alike’.
Lord Drayson, Minister of State for Science and
Innovation,The 2008 R&D Scoreboard, pp. 2-3
How important is R&D?
• EU target of increasing research and
development (R&D) to 3 per cent of GDP by
2010
• Illusive or elusive ‘externalities’?
• Frequent failure to distinguish between ‘R’
and ‘D’
• Many innovating firms do little or no R&D
Innovation expenditure per employee (£ in 2004)
From: Abreu, Grinevich, Kitson and Savona (2008), Taking
Services Seriously, NESTA
Innovation expenditure per employee (£ in 2004)
From: Abreu, Grinevich, Kitson and Savona (2008), Taking Services Seriously,
NESTA
Importance of corporate
laboratories
• Conventional view is that innovation takes
place within the corporate laboratory
• But most ideas and most expertise are outside
the organisation
• Importance of being open
• Importance of being connected
• Importance of Knowledge exchange
Source: Chesbrough, 2006
The implications of open
innovation
• Importance of developing networks and
communities
– It is not costless
– Often difficult for individual businesses
• Develop ‘boundary spanners’ – people who
understand partners and can manage relationships
• Utilise economic anchors – organisations that do not
move
– Universities and Hospitals (‘eds and meds’)
Innovation: the role of universities
• The ‘laissez faire’ model
– Importance of chance, luck and serendipity
• The narrow model
– Focus on a narrow range of technology transfer
mechanisms
• The wider model
– Focus on a wide range of interactions
– Exchange rather than transfer
The laissez faire model
• Universities focussed on two missions – research and
education
• Example: the ‘Cambridge Phenomenon’ initially
developed when the University took little active
interest in business engagement. In the past:
– University largely ignored IP issue
– Adopted a liberal attitude to what academics did
– Industrial liaison merely acted as ‘window’ on
what the university did – little exchange or
dialogue
The standard narrow model
• Narrow focus on Technology Transfer
• Mechanisms: Patents, Licenses, Spin-outs
• Limitations
– Model is incomplete
– Potential financial returns were frequently overestimated
– Metrics distorting behaviour (Goodhart’s Law: any
observed statistical regularity will tend to collapse
once pressure is placed upon it for control
purposes)
Commercialisation Activities of
Academics
• Patents (7% of academics)
• Licenses (5% of academics)
• Spin- outs (4% of academics)
The wider model: multiple knowledge
exchange mechanisms
•
•
•
•
•
A ‘systems’ approach and not simply ‘market failure’
Educating people
Problem solving
Role of many disciplines (not just STEM)
Interactions with public and third sectors as well as with
business
• Public space functions (Universities do not move)
– Relatively neglected, but distinctive
– Includes networking, social interaction, meetings, informal
advice etc
• Focus on exchange not simply ‘transfer’
Academic Interactions with External Organisations
People-based activities
Standard-setting
forums
Giving invited
lectures
Participating
in networks
Enterprise
education
Student
placements
Curriculum
development
Communitybased
activities
Lectures for
the community
Attending
conferences
Sitting on
advisory boards
Employee
training
Commercialisation
activities
5
Licensed
research
Public
exhibitions
7
Patenting
Schools
project
4
Community-based
sports
Spun-out
company
14
Formed/run
consultancy
Format adapted from Ulrichsen (2009)
Source: Abreu, M., Grinevich, V., Hughes, A. and Kitson, M. (2009), Knowledge Exchange between Academics and the
Business, Public and Third Sectors, Centre for Business Research, University of Cambridge, Cambridge.
Academic Interactions with External Organisations
People-based activities
65
87
Standard-setting
forums
Giving invited
lectures
Participating
in networks
38
6
Enterprise
education
31
Sitting on
advisory boards
Attending
conferences
33
Student
placements
Communitybased
activities
38
33
67
28
Commercialisation
activities
Problem-solving activities
35
Public
exhibitions
Research
consortia
57
7
Informal
advice
Patenting
10
Prototyping
and testing
15
30
Schools
project
Curriculum
development
5
Licensed
research
Lectures for
the community
3
Community-based
sports
Employee
training
4
Spun-out
company
49
Hosting
personnel
Joint
research
43
27
Consultancy
services
10
External
secondment
37
14
Formed/run
consultancy
46
Joint
Publications
Contract
research
9
Setting of
physical
facilities
Format adapted from Ulrichsen (2009)
Source: Abreu, M., Grinevich, V., Hughes, A. and Kitson, M. (2009), Knowledge Exchange between Academics and the
Business, Public and Third Sectors, Centre for Business Research, University of Cambridge, Cambridge.
Constraints on Collaboration
• Commonly cited constraints include:
– cultural differences
– disputes over intellectual property (IP)
• But, overall, these are not highly cited by in
the businesses or academics
• Although they may be important for certain
types of interaction
Academic and business perceptions of
constraints on interactions
Bureaucracy /inflexibility of
univ admin
Insufficient rewards
Insufficient resources internally
Identifying partners
Cultural differences
45
40
35
30
25
20
15
10
5
0
Reaching agreement on terms
(incl IP)
Lack of experience in dealing
with academics
Academics
Business
Lack of external interest
Differences in timescale
Source: Hughes, A. and Kitson, M. (2010), Connecting with the Ivory Tower: The Business Perspective on
Knowledge Exchange in the UK, Centre for Business Research, University of Cambridge, Cambridge.
Innovation Policy: lessons from
Europe
• Moderately superior comparators:
– Schleswig-Holstein (Germany)
– Wales (UK)
• Superior comparator:
– Liguria (Italy)
• Significantly superior comparator:
– Noord-Brabant (The Netherlands)
• Leading regions as target comparator:
– Gothenburg (Vastsverige)
– Southern Finland
A new framework for innovation
policy
•
•
•
•
Importance of local economic structure
Adopt a broad notion of innovation
Foster connectivity and openness
Importance of key regional economic
anchors
• Develop a Triple Helix approach
• Develop appropriate governance and
policy implementation
Importance of local economic
structure
• Build on local strengths
• Develop, transform and upgrade local
industries
• More cost effective and a bigger impact then
developing new industries
Adopt a broad notion of innovation
• No simply about high technology
manufacturing
• Importance of process
• Importance of design
• Importance of business practice
• Importance of innovation in services and
‘traditional sectors’
A useful electronic device?
‘It has no camera; no USB port; no
replaceable battery; no obvious
advantage over a laptop, it doesn't
support Flash’
Who would buy this?
Foster connectivity and openness
• Develop collaborative structures and
communities
• Develop a professional skilled secretariat
• Train ‘boundary spanners’
• Networks must be outward looking and
inward looking
• Move from giving grants to supporting
networks
Importance of key regional
economic anchors
• Many economic actors move or can move
– Skilled workers, businesses
• Importance of connecting to local economic
‘anchors’
– Major employers, universities, hospitals
• Creates and embedded networked economy
High Tech Campus Eindhoven
• In 1999, Philips decided to
concentrate all its
innovation activities in
one campus
• Since 2001 the campus
has been open to other
high-tech companies
• It operates under an
“open innovation” policy
• Facilities are shared, and
collaborations and
knowledge exchange are
encouraged
Develop a Triple Helix approach
• Triple Helix: foster and strengthen
connectivity between business, universities
and policy makers
• Fosters knowledge exchange and wider
innovation
• Strengthens all partners and the local
economy
ISH: Schleswig-Holstein
ISH: Schleswig-Holstein
• Public-private partnership
• Foster and support collaboration between
academics and business to develop innovation
• Provides (temporary) financial, institutional
and informational support
• Supports development of facilities and
studentships in the regions’ universities
• Objective is culture change and developing
long-term collaboration
The Triple Helix approach in
Northern Ireland
• Northern Ireland has strong universities
• The UK study of knowledge exchange in the
UK shows that academics from Northern
Ireland engage in more knowledge exchange
activity than academics from any other part of
the UK
Governance and evaluation
• Collaborative structures need to be guided by
the needs of business, academia and the
policy community
• Focus should be long-term - and policy should
not shift based on short-term changes or
temporary
• Metrics should be concerned with innovation
trajectories and behavioural change
Summary: Building a Networked
Economy
• Importance of local economic structure –
supporting key sectors – often large traditional
sectors
• Role of key regional economic anchors
– Universities, Hospitals, Large Businesses
• Importance of local culture and traditions
• Importance of governance structures
– Policy must be long term
– Impacts will take time
– Importance of appropriate metrics
Summary Building a Networked
Economy
• Building collaborative structures – between
different businesses and with academia and
government (Triple Helix approach)
• Structures must facilitate and manage
relationships – providing finance/ grants is
insufficient
• Importance of providing information on how
to collaborate and the potential benefits