A presentation from the HEFCE conference 2017 on 12 October 2017.

1. Luke Georghiou
Deputy President and Deputy Vice-Chancellor
University of Manchester
Universities as Core Partners in Realising the
Industrial Strategy

2. Universities provide golden thread through Industrial
Strategy
• Strong identity with place
• Research powerhouses attracting &
leveraging private investment
• Pipeline for talent to raise
productivity
• Founding and supporting growing
businesses
• Conduit to global networks and
markets
• Expertise in key sectors energy
infrastructure etc

3. But…chorus of disapproval combined with
climate of expectation surrounds universities
Demonstrated contribution to UK economy
and society but
• Impact not reaching all sectors of the
economy and society or at least not
visible to them
• Risk of anecdote over evidence
• High presence in UK’s R&D profile 26% cf
OECD average 18% extends expectation to
include clear role in innovation
• Reinforced by formation of UKRI and
enhanced role of impact in REF
• Multiple missions, limited resources
especially time

4. Interdependency: Building an Innovation Ecosystem
Source: L.Georghiou cited in House of Commons Select Committee on Science & Technology Report Bridging the valley of
death: improving the commercialisation of Research, March 2013

5. • People
– Having the right skills and talents, entrepreneurship and enterprise
capability, critical mass in labour markets for creative people, cross-
sectoral mobility
• Finance
– Investment in research, support from banks for growth companies, seed
capital, venture funding, enabling investment in infrastructure (physical
and intangible)
• Services
– Infrastructure and associated services for innovation including
incubators, science parks, facilities/equipment, digital connectivity,
business support, access to equipment for testing etc.
• Knowledge
– Formal and informal flow of ideas, IPR and opportunities created and co-
created by actors in the system
Linking it together – four key flows in the
innovation ecosystem

6. Most important elements of the innovation
ecosystem according to 698 businesses in
11 European countries including 93 in UK
0%
10%
20%
30%
40%
50%
60%
70%
80%
knowledge
flows
mobility of
people
financial
support
services Other
Agri-food Biopharma Clean technologies ICT Manufacturing
This project has received funding from the European Union’s Horizon 2020 research and innovation programme under grant agreement No 64935.
The European Commission has no liability in respect for the above contents.

7. Importance of stakeholders in the
innovation ecosystem
0% 20% 40% 60% 80%
Other infrastructure
Finance
Regulators
Suppliers
Customers
Public research bodies
Percentage of firms
Stakeholders
“Our eco-system really is our customer base I think. Then it is the providers of staff to us, if
the universities are doing good research then they are then training people we need to
take.”

8. Nature and
scale of
knowledge
exchange
mechanisms
between
academics
and external
organisations

9. Uninterrupted Growth: UK HE-BCI Income 2003-15
(£Ms Real Terms)

10. A UK strength: international comparisons
But fallen back
from peak
ranking of 2nd in
WEF Global
Competitiveness
Report for
university-
industry
collaboration in
R&D to 6th place

11. Motivations
• Access to funding from industry
• To provide an outlet for research
results
• To promote entrepreneurship and
secure employment for graduates
• To access complementary
expertise
• To access state-of-the art
equipment
• To contribute to regional and/or
national economy
• Secure supply of recruits
• Access to scarce scientific
expertise
• Access to exploitable intellectual
property
• Enhancing the scope & testing of
in-house corporate activities
• Scanning and entry to “invisible
college”
• Cost saving through outsourcing
For universities to work with
business
For business to work with
universities

12. Barriers to collaboration
• Different objectives for research
– Corporate volatility in objectives
– Concerns for academic freedom
• Different timescales
• Legal or structural barriers
• Career incentive structures not favourable
• Tension between imperative to publish and IPR requirements
• Interface problems in identifying partners and negotiating
terms
• Tension between vocational and educational objectives
• Differing expectations on price/cost

13. Getting it right in business
engagement
• Rests on ability to configure interdisciplinary teams around
key challenges for partners
• No compromise on excellence
– Partners clear: “we do not want universities to be second rate
corporate R&D labs”
• Large firm strategy based on strategic partnerships which
extend scope and scale of collaborations, allow sharing of
strategic information and substantially reduce transaction
costs
• SME strategy often people-focused with KTPs and internships
a core element
• Transaction costs may be addressed by working with
associations and supply chains

14. Sharing best practice
• McMillan Group review of technology transfer1 showed need
for TT policies to be sensitive to local entrepreneurial
conditions
• But also addressed the existence of an effectiveness gradient
in TT practice
• Resonant phrase picked up by Select Committee, Government
Response and UKRI
– “The lack of a ‘one-size-fits-all’ approach to successful technology
transfer does not preclude the sharing of best practice”
• Also stressed need for university senior management to
provide clear statements of purpose and approach
– But that must be mirrored in career incentives and everyday practice
1. Published HEFCE September 2016

15. Challenges and Opportunities
• Challenge and Partnerships are the key words in R&I policy
– Industrial Strategy Challenge Fund will demand both excellence
and state-of-the-art business engagement from Universities
• UK Innovation Ecosystem has universities at its heart
– Need to make the case again & again & again for the value of
research and the positive state of knowledge exchange in the UK
• What is good must still be better if we are to realise the
Industrial Strategy
– As with productivity we need to raise the average towards the best
– Attention in ecosystem flows to inputs as well as outputs
– We risk hollowing out capability through cumulative demands for
matching funds – QR critical to sustainable capacity to engage