Universities, industry and innovation: a discussion ‘think piece’ Professor Lynn Martin Birmingham City University A presentation given at Innovation Day, 19 th March 2009. This presentation forms part of the Observatory’s ongoing State of the Region dialogue between policy makers and researchers on the theme of innovation.

Universities, industry and innovation - a discussion ‘think piece’ Professor Lynn Martin, Birmingham City University and Dr Julia Rouse, Manchester Metropolitan University 19th March 2009

Universities and Industry Policy documents Innovation is seen as the route to competitive advantage. knowledge transfer between university and industry supports innovation UK universities to develop a range of initiatives to connect with business e.g., via HE Innovation funds

Policy documents

Innovation is seen as the route to competitive advantage.

knowledge transfer between university and industry supports innovation

UK universities to develop a range of initiatives to connect with business e.g., via HE Innovation funds

Is the university-industry relationship established? A work in progress? UK firms may have extensive but weak links with universities, using them as one of a range of sources for business partnerships, information or assistance (Abreu et al, 2008; Hughes, 2008). Even innovative firms put universities low in the pecking order behind customers and suppliers as knowledge sources in the USA and the UK (Cambridge Centre for Business Research and MIT, 2007). Perhaps this also indicates the relative value that company owners and managers place on different sources of knowledge for innovation. US firms more likely than UK to rate university sources of knowledge as very important for their innovation; US firms are also more likely to invest in training to support university links (Cosh et al, 2006). So when universities and companies connect, how does this occur?

A work in progress?

UK firms may have extensive but weak links with universities, using them as one of a range of sources for business partnerships, information or assistance (Abreu et al, 2008; Hughes, 2008).

Even innovative firms put universities low in the pecking order behind customers and suppliers as knowledge sources in the USA and the UK (Cambridge Centre for Business Research and MIT, 2007).

Perhaps this also indicates the relative value that company owners and managers place on different sources of knowledge for innovation.

US firms more likely than UK to rate university sources of knowledge as very important for their innovation; US firms are also more likely to invest in training to support university links (Cosh et al, 2006). So when universities and companies connect, how does this occur?

How does Knowledge Exchange with HEIs occur? People Recruitment, Personnel Exchanges and internships, Studentships Codified Knowledge Publications, Patents, Prototypes Problem Solving Contract Research Joint R&D Projects, Consulting by University Staff, Testing, Standards, access to specialised equipment, Consortia, Non exclusive and/or exclusive licensing Public Space Meetings and Conferences, Standard setting fora, Entrepreneurship Centres, Networks, Joint Curriculum Development Committees, Informal Contacts, Invited Lectures, Brainstorming Sessions Other Collaborations with University Spin Outs Contact with Intermediaries or Boundary Spanning Organisations

People

Recruitment, Personnel Exchanges and internships, Studentships

Codified Knowledge

Publications, Patents, Prototypes

Problem Solving Contract Research

Joint R&D Projects, Consulting by University Staff, Testing, Standards, access to specialised equipment, Consortia, Non exclusive and/or exclusive licensing

Public Space

Meetings and Conferences, Standard setting fora, Entrepreneurship Centres, Networks, Joint Curriculum Development Committees, Informal Contacts, Invited Lectures, Brainstorming Sessions

Other Collaborations with University

Spin Outs Contact with Intermediaries or Boundary Spanning Organisations

Knowledge Transfer research Knowledge - embedded in the interactions of people, tools, and tasks – is the basis for company competitive advantage (Argote and Ingram, 2000) Research into how universities and industry interrelate – benefits and barriers - can be divided into 4 categories; firm characteristics, university characteristics, spatial relationships and channels of knowledge transfer : Research in the 'firm characteristics' category focuses directly on company issues, such as internal organization, resource allocation, and partnerships. Research in the 'university characteristics' category focuses on issues relating to the university, such as licensing strategies, incentives for professors to patent, and policies such as taking equity in return for intellectual property. (SBD) Research into spatial relationships between firms and universities is related to performance in terms of knowledge transfer success Research in the 'channels of knowledge transfer' category examines the importance of knowledge transfer routes between universities and firms, such as publications, patents, and consulting (Agrawal, 2001).

Knowledge - embedded in the interactions of people, tools, and tasks – is the basis for company competitive advantage (Argote and Ingram, 2000)

Research into how universities and industry interrelate – benefits and barriers - can be divided into 4 categories; firm characteristics, university characteristics, spatial relationships and channels of knowledge transfer :

Research in the 'firm characteristics' category focuses directly on company issues, such as internal organization, resource allocation, and partnerships.

Research in the 'university characteristics' category focuses on issues relating to the university, such as licensing strategies, incentives for professors to patent, and policies such as taking equity in return for intellectual property. (SBD)

Research into spatial relationships between firms and universities is related to performance in terms of knowledge transfer success

Research in the 'channels of knowledge transfer' category examines the importance of knowledge transfer routes between universities and firms, such as publications, patents, and consulting (Agrawal, 2001).

Barriers/suggestions (Connor and Hirsch, 2008) Companies develop internal management capacities to Be clear about what they want from HE Choose academic partners carefully Appreciate and use universities for their strengths Use a range of links - informal contacts, local networks, internships, knowledge exchange and other actions HE should Make it easier for employers and employees to find out what HE can offer via accessible points of contact and improve internal communications to better join up external opportunities with internal responses Be business-like responsive but realistic in dealings with employers Be strategic about employer enjoyment Encourage academics to be 'industry active' and to make industry more aware of their applied research Across organisations Long term relationship not one night stand Find connectors – skilled intermediaries to bridge the gap between academics and industry

Companies develop internal management capacities to

Be clear about what they want from HE

Choose academic partners carefully

Appreciate and use universities for their strengths

Use a range of links - informal contacts, local networks, internships, knowledge exchange and other actions

HE should

Make it easier for employers and employees to find out what HE can offer via accessible points of contact and improve internal communications to better join up external opportunities with internal responses

Be business-like responsive but realistic in dealings with employers

Be strategic about employer enjoyment

Encourage academics to be 'industry active' and to make industry more aware of their applied research

Across organisations

Long term relationship not one night stand

Find connectors – skilled intermediaries to bridge the gap between academics and industry

Where possible use connectors Cross organisational Contact KE – liaised with individual academics and with universities across the West Midlands to build up relationship and to identify expertise. At the same time worked with a range of other organisations already known/trusted with an existing relationship with West Midlands firms. Because this built on existing relationships more companies were engaged than in other similar initiatives and with more tangible results SMEs The West Midlands Technology Network (WMTN) estimated that 2,461 jobs were created and safeguarded; with 1,131 innovation projects having been delivered across the region. £100 million Sales for West Midlands Businesses Secured through Innovation from Local Universities More specific sectoral/technical Birmingham City University's Jewellery Industry Innovation Centre (JIIC) a one stop option for companies, ranging from SME to micro businesses, seeking assistance in the areas of new product development, design, technology application and close to market research. JIIC offer services and expertise to producers of small products, or giftware, automotive, ceramic, engineering, and white goods industries.

Cross organisational

Contact KE – liaised with individual academics and with universities across the West Midlands to build up relationship and to identify expertise. At the same time worked with a range of other organisations already known/trusted with an existing relationship with West Midlands firms. Because this built on existing relationships more companies were engaged than in other similar initiatives and with more tangible results

SMEs

The West Midlands Technology Network (WMTN) estimated that 2,461 jobs were created and safeguarded; with 1,131 innovation projects having been delivered across the region. £100 million Sales for West Midlands Businesses Secured through Innovation from Local Universities

More specific sectoral/technical

Birmingham City University's Jewellery Industry Innovation Centre (JIIC) a one stop option for companies, ranging from SME to micro businesses, seeking assistance in the areas of new product development, design, technology application and close to market research. JIIC offer services and expertise to producers of small products, or giftware, automotive, ceramic, engineering, and white goods industries.

Regional policies Regional economy and innovation reports - a key factor impeding growth of the regional economy is low R&D investment and innovation levels, so WM needs to “increase the regional levels of R&D expenditure and activity (especially by the private sector) and to increase knowledge transfer between research and business - and between businesses - to generate more innovative businesses”. (AWM, 2004; 2007). Previous and planned uni-ind actions offer a “ladder of progression” with entry at different points depending on past engagement; priority for approaches enabling a strong business demand-led process to encourage business investment. The Regional Innovation Technology Council’s primary role is to champion the key areas with potential to lever big economically significant innovations and so promote the region globally as a distinctive and attractive place in which to innovate while promoting learning about what innovative ideas work and learning about the actual processes of innovation. This is a logical approach in terms of investment but may not enable the level of development of innovation seen in Scandinavia for instance where a mixed approach was adopted (TEKES, 2007)

Regional economy and innovation reports - a key factor impeding growth of the regional economy is low R&D investment and innovation levels, so WM needs to “increase the regional levels of R&D expenditure and activity (especially by the private sector) and to increase knowledge transfer between research and business - and between businesses - to generate more innovative businesses”. (AWM, 2004; 2007).

Previous and planned uni-ind actions offer a “ladder of progression” with entry at different points depending on past engagement; priority for approaches enabling a strong business demand-led process to encourage business investment.

The Regional Innovation Technology Council’s primary role is

to champion the key areas with potential to lever big economically significant innovations

and so promote the region globally as a distinctive and attractive place in which to innovate

while promoting learning about what innovative ideas work and learning about the actual processes of innovation.

This is a logical approach in terms of investment but may not enable the level of development of innovation seen in Scandinavia for instance where a mixed approach was adopted (TEKES, 2007)

How will the region embed these examples in policy and build better university-industry links? Who or what will be the connectors between companies and universities in the next 10 years? Long term relationship? The change of focus from short term project based to long term trust-based relationships takes time and may need intermediary support. How can this be incorporated in current practice or future policy? Learning The range of projects and initiatives being reviewed offer key learning points for future knowledge exchange work – how can these be captured and used in making policy and practice decisions in the region? Focus as a limiting factor The policy and initiatives focus on a small number of areas, which it is hoped will deliver large returns. How is this affected by the credit crunch and how will the region deal with the implications of change? Internal resources Key factors impeding knowledge transfer are the managerial capacities in organisations, the ability to develop strong ties with useful partners and to capitalise on these – how will the region update its managerial base to face the challenge of the next 10 years?

Who or what will be the connectors between companies and universities in the next 10 years?

Long term relationship?

The change of focus from short term project based to long term trust-based relationships takes time and may need intermediary support. How can this be incorporated in current practice or future policy?

Learning

The range of projects and initiatives being reviewed offer key learning points for future knowledge exchange work – how can these be captured and used in making policy and practice decisions in the region?

Focus as a limiting factor

The policy and initiatives focus on a small number of areas, which it is hoped will deliver large returns. How is this affected by the credit crunch and how will the region deal with the implications of change?

Internal resources

Key factors impeding knowledge transfer are the managerial capacities in organisations, the ability to develop strong ties with useful partners and to capitalise on these – how will the region update its managerial base to face the challenge of the next 10 years?

Links Contact the Knowledge Exchange, Richard Riley http://www.contactke.co.uk/ Jewellery Industry Innovation Centre, Gay Penfold http://www.jewellery-innovation.co.uk/ West Midlands Technology Network http://www.wm-technet.co.uk/index.php

Contact the Knowledge Exchange, Richard Riley

http://www.contactke.co.uk/

Jewellery Industry Innovation Centre, Gay Penfold

http://www.jewellery-innovation.co.uk/

West Midlands Technology Network

http://www.wm-technet.co.uk/index.php

Contact details Professor Lynn Martin Birmingham City University T +44(0)121 204 3183 E [email_address] Web www.bcu.ac.uk /business-school Brian MacAulay Senior Intelligence Analyst West Midlands Regional Observatory E [email_address] T +44 (0)121 202 3247 Web www.wmro.org Blog http:// wmro.wordpress.com