What are the implications for UK businesses of the emergence of the new knowledge driven economies of China and India? Damien McDonnell has a view
More recently we have seen the emergence of the new knowledge driven economies of China and India. Both have the potential to be massive economic powers in the near future and both are investing heavily in their scientific and technical infrastructures. They are now producing between them a staggering 5 million science and engineering graduates every year. The reality is that China and India will not be driven by low cost manufacturing for many more years but will, in fact, become high value added knowledge intensive economic giants. The expression “Thought of in Europe and made in China” will increasingly be:
Thought of in China and made in China.
The key challenge to address in accelerating innovation in the UK is to bring about a permanent cultural change in which the responsibility for leading the innovation agenda lies with business and not government or academia. In order to compete effectively then market-led, cross-sector and multidisciplinary innovation must become at least as important over the coming decade as technology-led innovation was in the past. Professor Henry Chesbrough from University College Berkeley has described and advocates a new approach, which he calls ‘Open Innovation’.
This approach recognises that business enterprises cannot remain competitive drawing exclusively on their own research and technology but need to adopt practices which repurpose technologies across market sectors through partnerships. In this approach to innovation the risk and the tension between ‘technology push’ and ‘market pull’ can be better managed to achieve greater benefits to their customers and hence sustain their competitiveness. However, three typical challenges face businesses as they strive to innovate in this manner:
- How do they gain awareness and access to technologies unknown to them but which could solve their problems?
- How can they achieve effective technology insertion?
- How can they anticipate technology-related threats and opportunities?
The evidence is now overwhelming that to compete in the modern world businesses must raise their game in harnessing science and technical skills into greater value addition and productivity in all that it does. The Scottish entrepreneur, Sir Tom Hunter, put it very simply:
If we always do what we have always done, then we will always get what we have got!
In order to embrace open innovation practices there is a knowledge integration conundrum that has to be overcome namely:
How do we get what we know to where in the business we need to know it, particularly when that knowledge is not explicit to us because it is tacit knowledge or it is from another sector? It is difficult to ask for something if you are not aware of its existence. Moreover, it is often the case that an owner of a possible solution is unaware of the question or the need. While invention is the work of an individual or a few individuals, innovation is the work of a community that can harness all the skills necessary to realize the successful commercial exploitation of knowledge.
The Quantum Innovation Centre will play a key guiding role to business, enabling open innovation, signposting the route to better exploitation of their R&D and making better use of the science base, with all the rewards that this will bring in terms of:
- increased profits;
- more rapid company growth;
- increased opportunities for overseas partnerships & investments; and
- more and better value added employment.
The UK is not starting from a low base, and we already have some of the best, R&D in the World and we can point to some truly outstanding academic work underway in fields as diverse as ICT, nanotechnology and advanced functional materials, aerospace, environmental energy technologies, and world leading health research and medical applications.
Damien McDonnell, Quantum Innovation Centre