When it comes to collaborative commercialisation in Australia, researchers have a vital role to play outside the laboratory, says Rowan Gilmore.Work with researchers? “Why would we want to?” I hear many of my friends in business ask. Perhaps it’s a response in jest, but there is a sensible answer.
It is widely recognised that those companies that innovate are more likely to grow and prosper in the long term, to export, and to be more profitable than firms that do not. But innovation comes in many guises, and from many sources. Innovation is all about successfully creating something of value in the marketplace, and results from new products or services, or new ways of serving the customer.
Most ideas for innovation in fact come from the customer, or from within the organisation. However, understanding what needs to be done is only the first part of the challenge; implementing those ideas is the hard part. It is here that organisations must frequently turn to outsiders for help.
Far from working in ‘ivory towers’, many researchers want to see their ideas translated into practical outcomes. The right idea in the right business can bring innovation value to the business, kudos to the researcher and their institution and better service to an end user or customer.
What then prevents stronger interaction between Australian business and the research community, when collaboration could clearly bring benefits to all?
The first challenge is one of perception and motivation. Businesses, particularly small businesses, often aren’t motivated to innovate. Only one-third of Australian businesses reported any innovation activity at all in the latest Australian Bureau of Statistics survey. The other two-thirds either don’t recognise they are innovating or are genuinely not, and will ultimately be overtaken and perish.
Perhaps focused only on managing cash-flow and risk, their need to innovate goes unrecognised. Collaboration, particularly with knowledge workers, is simply seen to be irrelevant. The boards of these companies should shake their lethargy by adding a standing item on the board agenda – innovation.
The second challenge is cultural, partly because the timescales of industry are typically much shorter than those of the research cycle. True, early-stage research takes a long time to commercialise, but our experience is that the know-how of researchers can be applied to help improve current product and process, even while longer-term innovation continues its gestation.
Incremental innovation, applied to existing business, creates value (the so-called ‘low hanging fruit’) during the wait for more radical innovation to mature. A related challenge is one of project management, but this is a feature of any collaboration and experienced managers can set things right at the outset and overcome the inevitable frustrations that result from misunderstanding of timescales and outcomes.
Other challenges include knowing who to approach, and where to source the best and most relevant, information and knowledge to grow the business. The valuation of intellectual property can also be a problem, since a researcher will often want to base its current value either on sunk cost plus profit, or its final value in the marketplace. The tax-paying business, on the other hand, will assume that much of the sunk cost has already been subsidised by government and rightly wish to incorporate future developmental and distribution costs into the cost side of the valuation equation.
So how can these challenges be overcome? An emerging solution is to use an experienced, independent third-party to help a business understand how it can start down the path to collaborative, market-driven innovation. They can then locate appropriate IP, value it, establish trust between the business and research organisation and provide project management and other services (such as market research and negotiating deal parameters) to build a successful collaboration.
Experience on both sides of the ‘divide’ can help facilitate a common objective and help manage the innovation. This requires individuals with business skills as well as an acute understanding of the research culture. The new Australian Government Intermediary Access Program is helping to fund innovation intermediaries in the AIC’s TechFast program to overcome the challenges in bringing ties and lab coats together. The dress codes may not quite match, but the possible outcomes for innovation are too important to ignore.
