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Why America must organize innovation

“Organized” and “innovation” are words rarely heard together. But an organized approach to innovation is precisely what America needs today, argue Steve Currall, Ed Frauenheim, Sara Jansen Perry, and Emily Hunter. We sat down with the authors of Organized Innovation: A Blueprint for Renewing America’s Prosperity to discuss why America ought to organize its innovation efforts.

Why does America need a more organized innovation system today?

An “innovation gap” has emerged in recent decades — where US universities focus on basic research, and industry concentrates on incremental product development. At the same time, the stakes have risen around technology invention and commercialization. Innovation has become more central to the economic health of nations, but the rate of US innovation is slowing while that if other nations is accelerating. Since 2008, the number of foreign-origin patents that the US Patent and Trademark Office has granted annually has surpassed the number of domestic-origin patents. Between 1999 and 2009, the US share of global research and development spending dropped, while the share of Asia as a whole rose and exceeded the US share in 2009.

What’s behind this innovation gap?

In a nutshell, history and a set of myths held by many in the United States. The gap dates to the 1970s and 1980s, as big US companies retreated from basic research and focused on incremental product development. The shift had to do with a greater focus on short-term financial results, as well as increased competitive pressures. Research fell to the universities, but academic research often remains within particular disciplines, conducted in a vacuum that minimizes societal needs. Too often academic research does not make the leap beyond the lab to the real world. For years, observers have noticed the widening gap, but it has not been addressed. We think that has much to do with three myths—that innovation is about lone geniuses, the free market, and serendipity. These myths blind us from seeing that we tolerate an unorganized, less-than-optimal system of innovation.

business school

What do you propose as a solution?

We call it Organized Innovation. It is a blueprint for better coordinating the key players in the US innovation ecosystem: universities, businesses, and government. The solution taps the power of both the private and public sectors to generate groundbreaking innovations—the kinds of new technologies that create good jobs and improve life for everyone.

The solution has three main pillars:

  1. Channeled Curiosity: steering researchers’ fundamental inquiries toward real-world problems.
  2. Boundary-Breaking Collaboration: tearing down walls between academic disciplines, and between universities and the private sector to better generate novel, high-impact technologies.
  3. Orchestrated Commercialization: coordinating the various players involved in technology commercialization—including scholars, university administrators, entrepreneurs, venture capitalists, and corporations—to translate research insights into real-world benefits.

The Organized Innovation framework already has proven effective in closing the innovation gap. It is inspired by our nearly decade-long study of a highly successful but little-known federal initiative, the National Science Foundation’s Engineering Research Centers. These university-based centers require researchers to link basic science to social and market demand, require interdisciplinary and industry-academic collaboration and encourage the creation of proofs-of-concept to demonstrate that a lab-based technology has commercial potential. From 1985 to 2009, about $1 billion in federal funding was invested in the centers. They have returned more than 10 times that amount in a wide variety of technology innovations.

What is your favorite example about new technology generated from the Engineering Research Center program?

Our favorite case is about Mark Humayun and his artificial retina. Humayun, a professor at the University of Southern California, is a fascinating individua, and his team developed a device that captures video from a camera embedded in eyeglasses and wirelessly relays digital signals to an implant placed directly on the retina. The artificial retina, called Argus II, is approved for use in the European Union and won US FDA approval in early 2013. Humayun’s device is changing lives — restoring useful vision to people blinded by retinal diseases.

You propose that the US government changes its approach to funding research and development. What is your message to policy makers?

We propose that federal and state funding agencies devote funds to research programs that embody Organized Innovation principles, which may translate into more funding for research with practical significance or innovation outcomes. The key advantage of our model is that we can maximize the public’s return on research and development investments. Both political parties can support this approach; it is fundamentally bipartisan.

Organized Innovation goes against the grain of widespread doubts about the ability of universities, business, and government to work together to solve problems, especially amid growing public deficits. But we’re convinced Americans will have the courage to see the value of such investments in our future.

Steve Currall, Ed Frauenheim, Sara Jansen Perry, and Emily Hunter are the authors of Organized Innovation: A Blueprint for Renewing America’s Prosperity. Steven C. Currall is Dean and Professor of Management in the Graduate School of Management at the University of California, Davis. Ed Frauenheim is an author and an editor at the Great Place to Work Institute. Sara Jansen Perry, Assistant Professor of Management in the College of Business at the University of Houston-Downtown, earned her Ph.D. in Industrial-Organizational Psychology at the University of Houston. Emily M. Hunter is Assistant Professor of Management and Entrepreneurship in the Hankamer School of Business at Baylor University after earning her Ph.D. in Industrial-Organizational Psychology at the University of Houston.

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  1. [...] Oxford University Press’ blog recently interviewed UHD assistant management professor Sarah Jansen Perry on her co-authored book, “Organized Innovation: A Blueprint for Renewing America’s Prosperity.” Read the interview here. [...]

  2. [...] An authors’ Q&A is available here. [...]

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