Perspectives on Innovation

There has been a fair amount said about the innovation “ecosystem” (also referred to as “infrastructure” or “landscape”) recently and, as we talked about it within and without the Technology Strategy Board, I realised that most people have a different opinion about what it is and how it operates. That is why many of the discussions I have listened to recently failed to achieve any degree of closure!

I am never sure whether it’s a failing or a strength but, when faced with a problem, I always look for similarities to the world of science that I was trained in. Most things exist at many different levels of scaling, and what you see often depends on which scale level you choose to look at. For example, many people devote their whole lives to understanding behaviour at the atomic level. As a result we know quite a bit about how atoms work. At the next scale level, there are those who seek to understand how molecules behave as ensembles. They cannot apply all the understanding of their “atomic” colleagues, because they would swamp their models, so they take what they need and approximate the rest. At the next level, where scientists and engineers effectively treat materials as continuous, the learnings from the molecular level (and those from the atomic level that are contained within) are included, but in a cut-down form. This goes on and on, each level taking what it can from the complexities of the level below, but seeing the part of the scale it is most interested in.

 As we thought about it, we realised that the environment in which innovation happens looks very different at different scales. If you are a small company looking for support it looks like one thing, if you are a government agency trying to support those companies, it almost certainly looks very different – and there are many intermediate levels that understand bits up and down but cannot see the whole picture.

 If you are a small company inside whatever we call it, then although it is rarely a straight line, your progress is at least monotonic. Anything else would mean that there were discontinuities and “gaps” and although it may look like that from outside, from within a small start-up company, once started the one thing you crave is a smooth ride!

At the start, all the founder has is an idea. What they need first is other people who understand their idea and who can contribute to its development and implementation. Very quickly, the second need – for money – crops up. Unless you are independently wealthy or have another job that doesn’t mind you going AWOL in unpredictable ways, this takes you into scrounging off friends, courting angels and being very nice to the lower end of venture capital. Once you can pay yourself and the others to work solely on your idea, the fun begins. Depending on which field you are working in, you might need suppliers or subcontractors, you will be scouring the world for potential customers and you will be looking for information about the world you are now working in. Perhaps the thing that you don’t know you want is to meet people who have done what you are doing before, and who know the pitfalls and shortcuts. There are an increasing number of ways to meet these people, but support from the surrounding community is possibly one of the main reason why places like Silicon Valley keep on spawning new companies that work (as well as the number that don’t!)

If you take a view across the whole of a certain sector, things look different. What you see is many companies, each offering its own contribution to the development of the field – which may be the development of a technological capability, or the addressing of a specific market need. Although these companies are “in competition” with one another for funding, they may not necessarily be in competition with one another for customers – indeed, they may be developing complementary products or services. At this level, the complexity of innovation gets its first outing. Individual companies come and go, companies combine, people leave one company and join another, intellectual property is traded and so on. Looking from outside, it is difficult to know who is most deserving of help, who has the most commercial potential or who is closest to market. If you have money, they will all tell you that they are the best and most deserving case and that they alone can offer you the best return on your investment.If you are a potential customer, they will promise you the best product or service because they need your patronage and the promise of your custom. Each sector is different from one another, but many share common characteristics such as these.

Step up another level to the view a national body has and the picture gets even more complex. Each sector is competing for your support, your funding and your attention. Each of them sees their own field and thinks it is important. To them, it is. Each of them thinks that their needs are special and different from all the others. To an extent they are, but how do you choose between supporting exciting new technology in the healthcare field and developing transport systems with very much lower carbon footprints? How do you choose between developing the next generation of digital communications systems and the overhaul of the housing stock? How can you tell which area of activity is moving the fastest where your support can make a bigger difference sooner, or where the progress is slow and the field needs the most support to get it back into commercial contention?

If we are to understand the way innovation happens, we need to bear all these different views in mind. None is the only true way. Each can contribute to the eventual success. What we have learned – as a government backed agency trying to support those companies that are likely to have the highest return to the UK economy – is that we have to be able to span all the views. If we cannot explain how we view the sector or area that a company is operating in to them and convince them that we can add value to them, then they will not listen to us. If we cannot explain the overall view to those in government who back us with money, then they will cease to do so. What we have to do is hold both views in our heads as we work. They are different, but only in their perspective. What they are seeing is the same!

 

 

Last updated on Friday 24 February 2012 at 10:08

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  • How do we create a viable innovation system?|03/09/10 at 11:21 AM

    Agreed! And it is also a dynamic system that needs to be able to adapt and survive in a changing environment.

    That means that the various activities that are part of the system (at the various levels - national, regional, local, business, university etc.) need to be connected to stop different bits of the system causing problems for one another. It means that policy makers with a stake in the innovation system have a responsibility to allocate resources to the various activities, ensure that they deliver performance and are coordinated and coherent at all the connection points. It also means that there needs to be effort put into understanding the environment and future changes so that the system's activities can be developed to meet future needs. Otherwise we risk squeezing the maximum performance out of current activities without realising that the world has moved on and the innovation system needs to adapt and do different things.

    Using a top down design process may not be quick enough to keep up with the rate of change in the real world.

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