Digital Economy Dispatch #010

15th November 2020

Innovation is on a Mission

How should universities and businesses drive their innovation efforts in response to the covid-induced crisis? Many leadership teams are now concerned with this question with little clear consensus on the response.

It has been a tough few month for all organization. Having spent a lot of effort to ensure business continuity through the initial pandemic shock, they then had to respond to challenges raised by a rapidly changing business environment. An initial burst of team reorganization and operational flexibility appears now to have slowed to be followed with a pause for breath and a period of relative stability.

However, the pressure for rapid change remains. According to a recent report from McKinsey, although businesses see the overwhelming need for further innovation they feel under prepared and under resourced to step up to the challenge. Cutting costs, driving productivity, and ensuring resilience of business and IT systems dominate their efforts. As a consequence, outside of medical domains, the executives surveyed in the McKinsey report reported a decline in innovation across all industries. Innovation appears to be at an impasse.

This paradox has not gone unnoticed. A new report from the National Centre for Universities and Business (NCUB) describes the outcome from a taskforce looking at the innovation priorities for Universities and business in response to the current crisis. It also offers a set of recommendations for how to proceed in light of the R&D roadmap published by the UK Government in July 2020. Much of what they suggest involves structural reform and a focus on increased R&D investment from Government, as can be expected. However, beyond this, there is a strong emphasis that the innovation impasse can best be addressed through a mission-oriented innovation approach.

Organizing innovation around a set of missions has received a lot of attention in the past few years, and is particularly associated with the work of economist Mariana Mazzucato. Her recent book on the entrepreneurial state and subsequent activities take a provocative approach to the relationship between the public and private sectors to accelerate positive societal change. From her perspective most current innovation is boring and unambitious. Much of the rest is misguided. Furthermore, the term has become another lever for large companies and commercial interests to exploit profits for the personal gain of a few owners, shareholders, and venture capital firms.

A recent wave of writing, thinking, and activism is challenging much of the last decade’s promotion of innovation as a heroic venture driven by a handful of gurus generating large profits for highly valued companies. Two fundamental concepts form the basis for the concerns. One is that the role of the state in funding innovation is under-appreciated and under-rewarded. Consequently, this is limiting the state’s ambitions and mis-directing its investment in innovation. The second is that a maniacal focus on shareholder returns is driving the wrong decisions and behaviours to limit long-term societal impact of established companies.

The essence of a mission-oriented approach to innovation is that investment and effort should be targeted toward solving major societal problems and taking risks to achieve a greater objective. Mazzucato defines five criteria missions should obey: they must be bold and inspire citizens; be ambitious and risky; have a clear target and deadline; be cross-disciplinary and cross-sectorial; and allow for experimentation and multiple attempts at a solution, rather than be micromanaged top-down by a government. Examples she promotes include reducing plastics pollution, improving diagnosis and treatment of cancer, and lowering occurrence of dementia. Lessons from the US-based Defense Advanced Research Projects Agency (DARPA) indicate that organizing around missions creates strong public-private partnerships that deliver both new research and commercializable impact.

Mission-oriented innovation approaches are gaining support through the European Union’s recent update to its Horizons programme, and via funding commitments to a DARPA-style initiative in the UK. Such efforts will galvanize research agendas in the post-covid era and may well champion a new way for universities and business to work together. It can act as a much-needed boost for overcoming the current reticence to invest in sustainable long-term innovation. The UK initiative has been viewed as the pet-project of the Prime Minister’s close advisor Dominic Cummings. Let’s hope that his recent resignation does create too many additional complications for this scheme.

A new impetus for innovation cannot come fast enough for many of us anxious to ensure that the challenges of 2020 can be used as an innovation slingshot for progress in 2021 and beyond. From basements, attics, and spare bedrooms across the land let’s raise a cheer!

Digital Economy Tidbits

Educational technology is coming of age during the pandemic. Link.

More than 4,000 educational technology start-ups, attracting over $2bn of venture-capital funding, have emerged in India over the past five years. And many more to come.

AI is wrestling with a replication crisis. Link.

I really think this discussion in MIT Technology Review is making an important point about lack of transparency in AI code, algorithms, and models. If an organization like Google do not feel able to give any insight into how its systems work, we have a real issue. The critique of a paper published by Google scientists in Nature is a clear challenges to this:

Where do we draw the line between legitimate proprietary concerns about competition, and the broader scientific and societal needs for openness to verify such advances?

A new record for Alibaba one day online sales – $74B. Link.

The artificially contrived “singles day” (11/11) generated record 1-day sales for Alibaba of $74B. It is now bigger that “black Friday” and “cyber Monday” combined.

Learning and teaching reimagined: a new dawn for higher education? Link.

Just published, a new report from JISC on the future of Higher Education. Their number 1 recommendation is:

Summary:

This report is the result of a five-month higher education initiative to understand the response to COVID-19 and explore the future of digital learning and teaching.

It involved high levels of engagement with more than 1,000 sector leaders, staff and students through webinars, roundtables, consultations, focus groups, surveys, interviews and case studies.

In this report we explore the experience of 2020 and changing aspirations of the nature and shape of learning and teaching for the next academic year, 2021/22, and 2030.