THE CHINA QUESTION:Li Yuese nanti• Few people, other than scholars, will be familiar with the story of theCambridge don whose study of China’s scientific history helped to changethe West’s appraisal of a civilisation once thought hopelessly backward.• By the time Joseph Needham died in 1995, he had published 17volumes of his “Science and Civilisation in China” series, includingseveral that he wrote entirely on his own.• The Chinese began printing 600 years before Johannes Gutenbergintroduced the technique in Germany. They built the first chain drive 700years before the Europeans. And they made use of a magnetic compass atleast a century before the first reference to it appeared elsewhere.• So why, in the middle of the 15th century, did this advancedcivilisation suddenly cease its spectacular progress?• So powerful has Needham’s contribution been to the historiography ofChinese science that this conundrum is still known as “The NeedhamQuestion”. Even the Chinese themselves use it: the phrase inMandarin is Li Yuese nanti.• In 1936 three Chinese assistants came to work in his biochemistrylaboratory. One, Lu Gwei-djen, who came from Nanjing, began teaching himChinese, which ignited Needham’s interest in the country’s technologicaland scientific past. He retrained as a Sinologist and took a job in Chongqingas Britain’s scientific emissary.
• Network Ubiquity–More than a billion Internet users and three billionwireless subscribers, worldwide• Open Standards–Widely-adopted technical and transactionspecifications• New Business Designs–Horizontally-integrated operationsWorld Knowledge Economies andSocieties in a New and Emerging Era:21st-Century Drivers of Change
TOP PRIORITYFROM SOCIO-ECONOMIC BEING TOTECHNO-ECONOMIC BECOMINGFrom natural (and/or artificial) scarcityto technology- and knowledge-enabled abundance(Adapted from Carayannis et al, Smart Development, MacMillan, 2005)
Key Resources of theKnowledge Economy and Society…Adam Smith defined Land, Labor and Capital as the keyinput factors of the economy in the 18th century.Joseph Schumpeter added Technology andEntrepreneurship as two more key input factors in theearly 20th centuryIn the late 20th and the beginning of the 21st century,numerous scholars and practitioners such as PeterDrucker, have identified Knowledge as perhaps the sixthand most important key input and output factor ofeconomic activity.
TRIPLE VS. QUADRUPLE & QUINTUPLEINNOVATION HELIX• The Triple Helix focuses on top-down government, university andindustry policies and practices whereas the Quadruple Helix focuseson BOTH:– top-down government, university and industry policies andpracticesas well as– bottom-up and mid-level out civil society grass-roots initiativesand other actions that help better shape, fine-tune and makemore effective and efficient the government, university andindustry policies and practices.• The Quintuple Helix adds to the Quadruple Helix the environmentaldimension to ensure that said top-down, bottom-up and mid-level outpolicies, practices and initiatives are indeed as smart, sustainable andinclusive as possible and meet the triple bottom line (financial, social, andenvironmental) hurdles criterion.9
TRIPLE VS. QUADRUPLE & QUINTUPLEINNOVATION HELIX• The social and natural considerations act as the “creative glue” forpromoting smarter, more sustainable and more inclusive growthopportunities in the Knowledge Economy and Society for both developedand perhaps even more so for transitioning and emerging economies.• In this latter case, civil society and environmental structures, infra-structuresand institutions are often lacking or under-developed allowing for thecumulation of substantial negative externalities (such as pollution) andother transactional costs of growth (such as corruption) as well asimpeding or even suppressing market, knowledge and network spill-over effects (positive externalities).10
"The innovator has for enemies all who have done well under theold, and lukewarm defenders in those who may do well under thenew law."Nicolò MachiavelliWords of Wisdom to remember...
INNOVATION DEFINEDInnovation enhances the yield of resources viasuccessful technology commercializationInnovation resides at the intersection of inventionand insight, leading to the creation of social andeconomic value•US National Innovation InitiativeInnovation is a socio-economic, socio-technical, and socio-political phenomenonDelivering an Innovation Economy AND Society is the keystructural challenge for new growth in gloCalized Europe andWorld Knowledge Economies and Societies.We may need to think in terms of TARGETED OPENINNOVATION terms…
Source: Adapted from Elias G. Carayannis, GWULectures and in print, 2005STAGEOFINNOVATIONSECTORSECTORTECHNOLOGYTECHNOLOGYStart-uptechnologyventuresCorporateR&D LabsNanotechnologyInformation and CommunicationTechnologiesNon-profitR&D Labs BiotechnologyDeploymentDevelopmentDiscoveryGovernmentR&D LabsAdvancedMaterialsDiffusionCommercializationTHE INNOVATION CUBE
Idea | Research | Fuzzy Front End | Product Dev | CommercializationResourcesResearchResourcesCommercializationResourcesVALLEY OF DEATHEarly Stage Innovations1 in 5,000!17
S3 Business Technology Life CycleTime (t)TechnologyPerformanceperUnitCost(TP/$)[EfficacyorValue]R&D or ProductDevelopmentMarketAcceptance,Adoption,and InnovationLegacy orHeirloom TechnologyDiminishing ReturnsEconomicDisequilibriumEMERGENCE GROWTH MATURITY DECLINE• Also known as the product evolution S-curve.– Showing axes and various curve components labeledwith appropriate descriptors for the world of IS.
Time (t)TechnologyPerformanceperUnitCost(TP/$)[EfficacyorValue]Limit of PhysicsThere is a natural physicallimitation to the behaviorsof matter and energy uponwhich any technology isbased.Diminishing Economic ReturnsAt some point (even if the limit of physics is notobtained) the amount of marginal economic returnbecomes vanishingly small no matter how muchadditional resources are input.S3 What Makes the Curve S-Shaped• Every technology life cycle S-curve inevitablylevels off at the top.– At which point, NO additional incremental gain can be derivedfrom a system regardless of further resource availability.
Heterogeneity dynamics – (IPO)Number of firmsSize of firmsNumber of productsFirm PerformancesMarket concentrationC C CInput H Output HProcess HLand/Labour/CapitalTechnologyEntrepreneurshipKnowledgeC3 to S3: Co-opetition, Co-evolution , Co-specializationSource: (CARAYANNIS ET AL, DIVERSITY IN THE KNOWLEDGE ECONOMY ANDSOCIETY, MAY 2008)
Regional Innovation Network: Comparisons2 March 2011 Carayannis/Schoonmaker 29MarylandUniversities 56R&D Spending $14.3 billionIncubators 15PortugalUniversities 39R&D Spending $2.1 billionScience Parks 8
Mode 3: Regional Cultural ComparisonsDimension Maryland PortugalEntrepreneur - Focus on productdevelopment- Well-educated (MBA/Ph.D.)- Often, 1st start-up- Focus on incremental steps- Focus on going global- Well educated (MBA/Ph.D.)- Often, 1st start-up- Focus on incremental stepsGovernment - Primary support programsoffered at regional/local level-Primary support programsoffered at regional/local levelAcademia - Limited transfer ofknowledge throughTTO- Transfer of knowledge isactive viaTTOIndustry - Private financing at earlystages-VC financing typically withBiotech-Private financing at earlystages-Corporate funding for spin-offs2 March 2011 Carayannis/Schoonmaker 30
Mode 3: Regional Innovation Network2 March 2011Carayannis/Schoonmaker31Dimension BusinessObjectiveNetworkResourcesCulture GoalEntrepreneur -Firmrevenues-Firm profit-Skills-Knowledge-Focus-Incremental Approach-Learning style-Well educated(graduate degree)Creating a goingconcernGovernment Economicdevelopment-Support-Grants-Motivated by politicalenvironment and role ofpublic serviceEconomicshowcase(Political clout)Academia Royalties IP -Motivated by research–grants and placementof publicationsPower ofknowledgesuccess (Accessto grant fundsand bestresearchers)Industry ROI Funds -Private/Angel smallerrisk profile-VC controlling (largerrisk profile)High “hit” rate(Attracts otherinvestors andhigher qualityinvestments)
Triple Helix to Quadruple Helix:Industry Map2 March 2011 Carayannis/Schoonmaker 32Mode1Mode2Mode3Government Academia Industry Civil SocietyB2CI1CI2II3IB5GM1GB6GB7GI4GB8GB9GI5GM2GC1GI6GE1GBiotechChemicalEnergyICTMediaB1GB1IB1A B1CB2A B2IB2GB3G B3AB3IB3CB4GB4A B4I B4CI1G I1A I1II2G I2A I2CI3GI3AI3CB5A B5I B5CM1AM1IM1CB6AB6IB6CB7AB7IB7CI4A I4I I4CB8AB8IB8CB9A B9I B9II5AI5II5CM2AM2I M2CC1AC1I C1CI6AI6I I6CE1CE1AE1I
Triple Helix to Quadruple Helix:Regional Map by Cluster2 March 2011 Carayannis/Schoonmaker 33MarylandPortugalR&DFundingSupportGovernment Academia Industry Civil SocietyI2B5M2B3 B5M2C1I1E1B1B2 B5 B2B2B2B3B1B4I1I3I1I1 I3I4B6B6I2B7B7 B8I1B9B1C1I6E1B1 B1 B1B2 B3 B5 B9I2B4 B5 B6B2 B3 B7E1 I1 I4 I5B2 B4I5 I6E1I6I5M2M1B6B7 B8I2 I3 I4M1B1I1B2I1E1B5 B2B3B3 B5 B2B6 B8I2I4I1M1M1I3B7
Empirical Evidence2 March 2011 Carayannis/Schoonmaker 34• Networks with largest number of nodes and densityrepresent 70% of all connections in regionalinnovation networks. Pharmaceutical and ICTindustries are examples. (Christ)• Positive and significant correlation betweenuniversities and regional technology innovation.(Florida)• Mode 3 regression analysis demonstrated strongprediction (~80%) for payroll, salary, and revenues(Carayannis & Schoonmaker)
Key Findings2 March 2011 Carayannis/Schoonmaker 35• Civil Society– Virtual extension of all actors• Industries– Biotech and ICT are industries that are beginning to demonstrate‘Mode 3” and the ‘Quadruple Helix’• Regions– Maryland is leading the regional progression towards M3/4H– Portugal is operating on the frontier of M3/4H• Companies– M3/4H Best in Class companies are able to leverage all 4 actors– Highly networked, globally to locally, typically 2nd start-up
Mode 3: C3 Findings36• Academia and entrepreneurs tend to focus onthe product dimensions (effectiveness andefficiencies)• Government and industry tend to focus on thebusiness dimensions (integration and reach)• All work dynamically as part of the Ecosystem
AffordabilityAwarenessAccesibilityAvailabilityCharismaCharacterCultureCommunicationCoordinationCo-optationSustainableEntrepreneurshipEntrepreneurial Critical Success And Failure Factors–Gestation Period and PATIENCE are KEY Factors…–Co-location and a Global / Local View are KEY Factors…Source: (CARAYANNIS, DIVERSITY IN THE KNOWLEDGE ECONOMY ANDSOCIETY, MAY 2008)RobustCompetitiveness
QUADRUPLE HELIX ANDDEMOCRATIC CAPITALISM• Knowledge-based innovation should never be seen as a privilege ofindustrialized countries.• This indeed would be a misleading approach. Knowledge-based innovationsare just as valid for emerging economies and developing countries.• In that sense, the Quadruple Helix and the Quintuple Helix are global unduniversal.• The more appropriate question to ask would be what the specificimplications and ramifications for knowledge-based innovation would bewhen applied in diverse political, economic, social, and technologicalcontexts around the globe (Carayannis et al, 1998 to 2012) and how thisconcerns developed democracies versus emerging autocracies.40
QUADRUPLE HELIX ANDDEMOCRATIC CAPITALISM• In particular, the Quadruple and Quintuple Innovation Helix constructs maywell serve to reveal and promote ways and means to help advance growthin a manner that is becoming increasing aligned with the progress ofdemocracy instead of having growth advancing in defiance of and forthe suppression of democratic institutions.• Over the medium to long term, our fundamental belief and premise isthat true and transparent democracy constitutes a sine qua non forsmart, sustainable and inclusive growth and this constitutes our mainmotivation and guide for our focus on ways and means that conceptssuch as the Quadruple and Quintuple Innovation Helices, can servearchitect a better tomorrow for the peoples of the world.41
• The brightest frontiers ofknowledge reside at theintersection of technology,insight and traditionaldisciplines• A collaborative, sustainedcommitment by industry,government and academia isessential• Innovation is a culture, not adepartment•Nick D’Onofrio,–IBM Sr. Exec. VP–Invited Lecture, GWU SoB,October 2007Points to Remember…
Ending Thoughts...• Until philosophers are kings, or the kings andprinces of this world have the spirit and power ofphilosophy,... cities will never have rest from theirevils - no, nor the human race as I believe...[Plato, The Republic, Vol. 5, p. 492]• The lowest form of thinking is the barerecognition of the object. The highest, thecomprehensive intuition of the man who sees allthings as part of a system.’ [Plato]
THE CHINA QUESTION Re-visited…:Li Yuese nanti• Needham never fully worked out why China’s inventiveness driedup.• Other academics have made their own suggestions: the stultifyingpursuit of bureaucratic rank in the Middle Kingdom and the absenceof a mercantile class to foster competition and self-improvement; thesheer size of China compared with the smaller states of Europewhose fierce rivalries fostered technological competition; itstotalitarianism.• With its unreformed one-party system, its rote-learning in schoolsand state control of big businesses, “new China” is hardly a havenfor innovative thinking. Yet the Chinese continue to fret about theNeedham question.• A Communist Party chief of a middle school in central China recentlysaid that it deserved deep thought and that the answer lay in aneducation system that fails to emphasize improving “character”.• A former government minister also referred to Needham’s lamentthat China had produced no idea or invention of global impact formore than 500 years. Its contribution henceforth, the official said,should be “harmony”.