Follow the Innovation Summit 2013
On Tuesday 26 November the UK~IRC’s final Innovation Summit takes place at the British Library on the ‘Future of Science and Innovation Policy. The conference includes presentations from Rolls Royce, Trampoline Systems, University of Manchester, SPRU, NESTA and HEFCE.
Welcomes & Introduction
Professor Alan Hughes, UK~IRC Director welcomed delegates to the fifth annual UK~IRC Innovation Summit.
In 2004, he explained, there was major look forward via a 10 year science and innovation framework taking a medium term look at policy in this area which set a number of targets for R&D investments. However during this time government expenditure fell, although Higher Education R&D rose. In the last 10 years the business sector has failed to increase its R&D as expected, with declining investment, and should be a focus in the future. However, much of the UK’s R&D is global, relying on overseas funding which has advantages and disadvantages. Notably also 10 large firms account for around a third of R&D whereas independent small firms account for less than 4%.
Key issues going forward, therefore, are the relation of universities and business, and public sector procurement, which will be discussed in sessions today. It was also noted that businesses funding university research has declined relative to other countries.
However, Professor Hughes explained there are other ‘pathways to impact’ including people-based activities such as universities roles in developing skills, problem-solving and commercialisation. So going forward it’s vital to look beyond R&D investment to think of different types of impact and how to justify future levels of government spending.
Finally, today the UK~IRC launches its latest report on this area entitled ‘Connecting with the Ivory Tower: Business Perspectives in the UK’.
At this point, participants divided into two sessions, either Financing and Skills for Innovation or Public Sector Procurement.
Parallel Session 1: Public Sector Procurement
This session is chaired by Luke Georgiouh from Manchester Business School with presentations from his colleagues Jakob Edler and Elvira Uyarra, with Mark Phillipps from the Renfrew Group and Colin Cram from Marc 1 Ltd providing a practitioner perspective.
Luke Georgiouh introduced the session by explaining that public and economic policy tends to focus on regulating demand, whilst it is rare to think about the quality of that demand and direct it towards innovation. There has been, he argued a growing realisation that public procurement has a lot of potential, gaining greater attention in recent years, but without effective implementation as yet.
Elvira Uyarra described the Manchester Business School survey examining barriers and drivers to innovation in public procurement. They targeted suppliers to the UK public sector, many of which had introduced service, product and process innovation. It was noted that procurement had an impact on innovation and on sales in the private sector.
Jakob Edler then looked more closely at key examples from the results, showing several core challenges for public bodies including poor definition of need, risk and high learning / adaptation cost. It is important to note, he explained, that these challenges differ for each organisation. MBS had conducted detailed case studies on NHS, Greater Manchester Authorities and HMRC. Success in adopting innovation requires strong motivation within senior management team, as well as creating opportunities for co-generated learning where the supplier and public body work in partnership to adopt the innovation. In conclusion, he showed that demanding public sector procurement instantly becomes more innovative is impossible without addressing the deep and complex challenges these organisations face. It requires incentives, support, leadership initiatives, instruments and enabling organisations to help share knowledge across public bodies.
Michael Phillips from the Renfrew Group, a product design consultant, argued that innovation in procurement is most important, particularly in tenders, early engagement with procuring organisations and outcome-based specifications. One vital point is the ‘intention to purchase’ by all parties at the end of the innovation process helps to drive the development.
Colin Cram from Marc1 Ltd, a public sector consultant, explained that procurement innovation is a powerful tool for the government to generate economic growth. This has been recognised since the late 80s but hasn’t been implemented. One of the reasons for this is the fragmentation of UK public procurement, with more than 35 in the Manchester area alone, with little commonality between them, making innovative solutions very difficult. To remedy this, genuine access to expertise is necessary for organisations as well as some internal changes to processes. It was noted that central and local governments need to address ways to implement innovation in procurement processes and develop a more coherent, efficient and cost-effective approach which can have huge benefits for the UK economy.
Parallel Session 2: Financing and Skills for Innovation
This session is chaired by Paul Nightingale from SPRU with presentations from his colleagues Alex Coad, Marc Cowling and Josh Siepel
Paul Nightingale opened the session by asking where are the small firms that grow into large ones and is this prevented by skills or credit constraints. By focusing 97% of firms who do get credit, we overlook the 3% or who could be innovative and likely to grow.
Marc Cowling discussed SME motivation in high tech sectors which requires an increase in STEM graduates for who there is a high demand. Non UK firms, he argued are more likely to reinvest in graduates, than UK firms.
Josh Siepel examined long-term performance and the effects of general and specific human capital on long-term growth and survival. He asked what success would mean in this area and whether this is mere persistence or survival, but firms with STEM graduates are associated with higher performance.
Alex Coad talked about diversity, the dimensions of which depend on variables with conflicting results; so having younger founders showed higher entrepreneurial growth and technological skill secured high growth and employment.
Paul Nightingale then noted that there are issues with demand as well as supply, and whether there was too much underperforming entrepreneurial activity in the UK? He argued that firms fusing STEM with arts and humanities knowledge will experience higher growth. In conclusion, he argued that using high-growth firms as the basis for policy-making is misleading as firms dies, but technologies live on.
Keynote Speech: Ben Martin – 15 Challenges for Innovation Studies
Ben Martin, Professor of Science and Technology Policy at SPRU, University of Sussex and Editor of Research Policy, delivered the keynote session just before lunch, in which he looked back at half a century of innovation studies in order to identify the challenges and research focus for the future.
Innovation Studies, Martin argued concerns the ‘economic, policy, management and organisational studies of science, technology and innovation (STI) with a view to providing useful inputs to decision-makers concerned with policies for and the management of STI.’ In the last 50 years, he argued, the field has made 20 core advances including a refocus from the individual to the corporation; a move to multi-factor explanations; taking a resource-based view of firms; from single to multi-technology firms, and from closed to open innovation. Some of these changes had a specific impact on managing technology and innovation, while others were geared towards national and international policy.
Professor Martin then outlined his 15 challenges for the future, some of which represent major shifts in understanding, some concern managing intrinsic tensions and others are more general problems for scholars and practitioners. The first challenge, therefore, is to acknowledge and develop metrics to measure other forms of innovation which Martin currently describes as ‘dark’ such as incremental, financial or social innovations. Another challenge, which links to our UK~IRC project, is the move from traditional forms of innovation which still dominate academic study, to a greater focus on services which now dominate activity in most advanced countries. Greater focus also needs to be given to more mundane innovations, he argues, that in many ways contribute more to humanity and well-being such as domestic appliances, and those that alleviate poverty, as well as a focus on global systems of innovation linked to sustainability.
Finally, Martin stated, researchers in this field must do more to maintain integrity and avert misconduct, by being particularly sensitive to issues of data-borrowing and self plagiarism. In conclusion, he believes this is a good opportunity to assess past achievements but also to open debate about the type of field innovation scholars want to be in.
These challenges he argues are intended to provoke debate, but by engaging with these questions it create an opportunity to influence the shape and purpose of the field for decades to come. During the Q&A Martin explained that scholars cannot work alone. To move things on in both economic policy and in the ways it is perceived, the innovation community should work together to share evidence and address some of the more ambitious challenges outlined.