Innovation is an alternative model of economic growth that relies on leveraging knowledge and experience, science and business to create a new reality, rather than merely copy or improve old designs. Compared to growth through modernisation, this model assigns a different role to the state and gives priority to other business solutions.
The state provides an environment where high-risk projects may thrive by assuming a risk that no business ever would. By that I mean cognitive risk inherent to basic research which is expected to push forward the development od activity which would help to materialize the preferred vision od development. This model also requires public money to be used to fund prototypes as the first tangible manifestations of revolutionary ideas. In other words, the state’s task is to create innovative bricks which, just as LEGO bricks, when put together in the right way may become commercial innovations. And herein lies the gist of the issue – innovation cannot exist without commercial success. It is business that shapes innovation. This is not to say, however, that innovation is only driven by business from the get-go. On the contrary, business is the final link in the long chain of innovation.
Business’s creative input to the innovation process is discovering latent demand, demand for something that does not exist yet and what business sees as having market potential. Examples abound: from intermittent wipers through pharmaceuticals to the iPad. Obviously, this process has its risks as many new products or services turn out to be duds.
In most cases, businesses create new products, services, technologies based on existing designs that were invented, developed and often shelved in hopes their time would come. These are the innovative LEGO bricks I have mentioned, which to a large degree are created on the initiative of the state and with public money.
In her book “The Entrepreneurial State: Debunking Public vs. Private Sector Myths”, Mariana Mazzucato shows that innovative bricks that made the iPad possible are the outcome of diverse research programmes, including basic research, to advance broadly defined military and energy security, funded in this case by the US government.
• LCD: National Institute of Health, National Science Foundation, Department of Defence
• Li-Ion battery : DoE
• Signal compression : Army Research Office
• Micro hard drive: DoE / DARPA
• Touchscreen: Dep of Energy, CIA / National Science Foundation, Dep of Defence,
• Microprocessor, SIRI: DARPA
• GPS: Dep of Defence NAVY
• HTTP/HTML: CERN
• Internet: DARPA
Accordingly, the innovative LEGO bricks are, in a nutshell, the outcome of targeted research, including basic and applied research. All these bricks served some purpose in defence, security or healthcare. Due to the profile of cognitive risk, most were state-funded to a large degree.
Also research teams from the best US universities participated in these research projects. However, they were funded through contracts awarded by specialised government agencies, not grants given directly to universities.
Why? The reason is simple – the contractor (a government agency in most cases) specified the purpose of research and controlled its progress using the stage-go procedure. As is often the case, many projects were cancelled and countless outcomes of research work shelved due to costs or having no application. Many were resuscitated as a use for them was found. In other cases, chance discoveries were made that could be applied in a completely different field.
So, what are the conclusions for Polish innovation? There are several of them:
1. Polish innovation is not a necessity yet, but will be sooner rather than later.
2. The shift in the development model from modernisation to innovation will be slow and will require perseverance. That is why have to start right now.
3. This process will require preparation from businesses, scientific centres and state institutions:
• Innovation is not possible without involvement from business (from start-ups through medium enterprises to state-owned companies), but also
• Innovation is not possible without both basic and applied research.
• Innovation is not possible without state involvement (development mission, funding targeted research)
4. At the beginning of the innovation chain, research should be state-sponsored with business taking over towards the end, while joint efforts are required in the middle.