Unified funding required to stimulate innovation
-Danny Wootton is UK Innovation Director at Logica. The opinions expressed are his own. He will participate in a Reuters Budget live blog at noon GMT on Wednesday, March 24, 2010. Please tune in and join the discussion. -
It is pretty well accepted that budget cuts in public spending are inevitable, but it is important that a plan to effectively use the funding that will be available to stimulate the economy and drive innovation forward is developed.
This cannot be achieved through a fragmented approach. Overall, we need to have a joined up funding programme to stimulate innovation; from education to research, to incubation and through to commercialisation – in effect an innovation eco-system.
By laying out a path to an innovative culture over the coming years, it allows us to maximise the returns from limited future funding available.
One of the key elements of a connected innovation eco-system is the recognition that innovation is not just about invention or research, but also about the successful exploitation of those ideas for a positive benefit, be that economic, social or environmental.
Obviously, many people will have different views on what that plan and areas of competitive advantage should be, and that’s not for me to decide, however, I would be very disappointed if it didn’t include areas such as; a low carbon technologies such as a leading position in electric vehicles and the national infrastructure needed to support them, renewable energy, eco-mobility, the space industry and future security including physical and cyber.
But as I say, we should look at all of those areas a eco-systems that need an end to end plan.
Let’s start with schools and education – although it is important that we continue to support the arts in our education system, from schools to universities, but we also need a ‘connected plan’ to ensure we are investing in areas of education that we see as the stimulus for future economic growth in the next 10-20 years, making sure we have a range of GCSEs and degrees that map onto the country’s future growth sectors to ensure we have an adequate supply of suitably skilled employees in the future.
The same applies to research.
We need to ensure that we are investing in research programmes that will give the country a competitive advantage in the coming decades. If we run our country like a business, we would have a strategy, of which an R&D plan and a view of ‘what we want to be famous for’, I am not sure I see that for the UK. Usually, we would say that we shouldn’t constrain our research teams and we should allow them to think freely, however, in these times of limited funding, we need to have a clearer plan of where to spend our limited public funding.
To achieve the ‘success exploitation’ described above, another area that needs to be support, but is often overlooked, is the incubation and commercialisation of innovations. Many Regional Development Agencies do a good job of incubating local university spin-outs or start-ups, but there is often a gap between these activities and partnering models with larger companies, who often have the funds to commercialise these ideas, plus have the routes to market.
A funding stream for incubation centres to support innovation should be maintained, plus incentives for larger businesses to work with those centres in the exploitation of ideas, whilst maintaining or increasing the levels of R&D tax credits for businesses own development activities.
It is clear that from the research completed and the work that Logica are doing with many of its clients, that the implementing and commercialising of ideas is still a massive problem for British businesses and therefore continued support in this area is essential.
So, how do we fund all of the above activities in a time of reduction in public funding? Well for me its about looking at finding innovative ways of spending less rather than tax increases.
We live in a world where technology can easily be used to provide a more co-ordinated way of managing public procurement; taking a more dynamic approach to public programmes allowing the public sector to quickly benefit from changes in services and technologies, buying shared services across multiple public sector organisations to get economies of scale, simple procurement frameworks allowing smaller SME businesses to work with government etc.
With the right overall plan, none of the above are beyond the capability of the current or future governments, let’s hope it’s on their agenda.