Helping You Hunt Down Your Next Innovation27 October, 2015 / Articles
There have been various proclamations that innovation is slowing down over the past few years. The charge was led by Tyler Cowen in his 2011 e-book on the “great stagnation,” in which he argued that the ideas machine had somewhat ground to a halt.
Much of this concern rests on an apparent slowdown in the number of unique and groundbreaking innovations that are reaching the market. There is undoubtedly a change in how we classify innovation, with evidence suggesting that fewer patents contain truly unique findings, with an increasing number taking existing innovations and using them in novel ways.
The study, published in Nature, looked back through the history of the U.S. Patent Office to explore just how unique and revolutionary patent applications were. Not only did the analysis reveal that around 40% of patents are subtle refinements of previous works, the rate of ‘recombination’ is actually increasing at a rapid pace.
The importance of dissemination
So if technological recombination is now so important to innovation, it is fundamentally important that people are able to locate and make sense of the latest research and innovations that are happening around the world.
This is historically something that the research community has struggled with, both in terms of spreading the word about their research and in translating the findings into something the general public can consume.
The importance of doing this better was highlighted in a recent report from the OECD into the productivity of a nation. It found that there was a huge disparity between those at the leading edge and the mainstream.
Our research shows that the slow productivity growth of the “average” firm masks the fact that a small cadre of firms are experiencing robust gains. OECD analysis shows that the productivity of the most productive firms – those on the “global productivity frontier” in economic terms—grew steadily at an average 3.5% per year in the manufacturing sector, or double the speed of the average manufacturing firm over the same period. This gap was even more extreme in services. Private, non-financial service sector firms on the productivity frontier saw productivity growth of 5%, eclipsing the 0.3% average growth rate. Perhaps more importantly, the gap between the globally most productive firms and the rest has been increasing over time, especially in the services sector. Some firms clearly “get it” and others don’t, and the divide between the two groups is growing over time.
Innovating over the productivity gap
In other words, it isn’t so much that innovation is grinding to a halt, but rather that the innovation that is happening is not spreading throughout the economy quickly enough.
The authors of the OECD report highlight four key barriers to diffusion:
1. Greater global connectivity to allow for deeper learning around what is working
2. Easier means of experimentation with new technologies and business models
3. Better matchmaking to ensure that productive firms have access to the tools and resources they need to grow
4. Innovation investment should extend beyond just technology to include skills and managerial quality
That connectivity issue is highlighted in the recent NCUB State of the Relationship report, which revealed that whilst there is growing connectivity between university and business, these partnerships are often smaller in nature, and therefore harder to sustain over the longer-term.
What’s more, just 6% of businesses report any kind of relationship with universities, which highlights the challenges involved in getting the latest thinking into the mainstream of industry.
The recently published Dowling Review highlighted the importance of making the process easier, and a cohort of bodies are working on a new innovation brokerage tool to enable businesses to better locate cutting edge thinking and thinkers.
It is also a task that I will endeavor to support in posts to this blog. I will attempt to bring you some of the best thinking from the best universities, together with some fascinating projects that are making their way in the world of work.