September 25, 2009

The Blurred Boundary Between Science and Business

The second point from Sir Peter’s talk ‘Can Transforming Science Transform NZ?’ revolved around the blurred boundaries between science and business. The two are very different. Things cannot be easily measured in science that are valued and required by business, for example, profit forecasts, return on investment and other milestones. Science just doesn’t work that way – it is often hard to predict what will happen.

Simon Upton points out in the Dominion Post that “Politicians and managers just don't know enough about the essentially creative drivers of research to try to manage them.”

Sir Peter stated that the importance of business planning in grant applications has increased over the last decade. And so it should I believe, because scientists should not just get ‘money for jam’ - they must be accountable to taxpayers like everyone else. But because NZ Business investment in RST is so low, this has meant that the role of this business planning has fallen largely with the scientists, and as pointed out above, scientists really have no idea about business and vice versa.

Scientists have confused themselves between technology transfer and fundamental research, essentially trying to fit a mould while being micromanaged via the strict government grant process, which in Sir Peter's view creates a cynicism that leads to second-rate science.

Second-rate science achieves nothing, and to quote Simon Upton again, "attention would be better expended ensuring that those with the necessary business skills can access and commercialise the opportunities that arise in the ordinary course of research". In short: in R&D, the scientists should be left to the 'R' and the business/technology transfer experts should be left to the 'D'

I’m not so sure our research is second rate and in my experience traveling to conferences worldwide, I know that we can definitely hold our own. Do we simply not have the volume of basic research to drive innovation? Or is it that we lack the business skills to take great ideas to scale?

Potential solutions mooted here were:
  • Better assistance schemes for matching up science and business
  • Academics on company boards
  • Business Development/Technology Transfer skills as part of career development
  • Cheaper access to university research facilities

I agree with Sir Peter and I think he is creating a much-needed stir in his new role. The onus now lies with Prime Minister John Key and the National Government to make good on claims like "science should be at the heart of Government”, and "RST will be expected to play a bigger part in improving our economic performance". The recent announcements by Minister Mapp, indicate that things may at last be moving in the right direction.

1 comment:

  1. I always thought Simon Upton had a rather romantic view of RS&T. Particularly for someone that oversaw the development of CRIs with their focus on mission oriented applied RS&T.

    Investment in RS&T (along with investment in other intangible assets) hasa pay off in terms of economic growth, and the more intangible, uncertain, unappropriable and long-term the more it gets under-invested in by business.

    The first step to a solution is to separate out the various kinds of RS&T an economy needs in a way that helps highlight where the problems lie. Time scale to return isn't a bad proxy for the latter. With shorter-term return RS&T the investment decisions are easier and the focus needs to be on business taking responsibility. With undirected RS&T with little immediate pay off potential we are in Simon Upton country. Funds like Marsden and PBRF fit this bill with their strong emphasis on quality of investigator - although even here there are some moves a foot to shape the investment so it better fit with broader national priorities, and this isn't necessarily a bad thing.

    The issue lies with RS&T that is between these two extremes. Stuff that lies beyond the time horizons and risk profiles of a typical business, but is mission oriented and applied (and, all due respects to Simon Upton, hence needs business input into what is done, and what stops getting done). This is typically NERF/RFI. Managing this investment not only needs a good strategic understanding of what RS&T can deliver but also what business can - and how to get the best out of both.

    IMHO setting up a better framework to allow these conversations to occur is the answer and this is where the low hanging fruit lie in improving our systems. I note this isn't about sector plans and the like, it needs to happen at a much lower and different level of aggregation - perhaps something to comment on later when other things are not pressing.




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