The Midlands has a reputation for innovating, but a poor record of exporting its ideas. UKTI recently brought together directors, academics and export experts to see how we can better sell our ideas abroad.
- ANDY LAWTON-SMITH Probrand
- GRAHAM ASHMORE West Midlands Chambers of Commerce
- ANDY BROOKS Keele University
- RICHARD FALLON European Bioenergy Research Institute
- SIMON JENNER Birmingham Science Park Aston
- SIMON JONES Cisco
- DOUG MAHONEY UK Trade & Investment
- PETER MATHEWS Country Metals
- RICHARD SIMPSON Birmingham University
- PAM WADDELL Birmingham Science City
Is the region really still innovative, or do we tell ourselves that to make us feel better?
Doug Mahoney The region’s good at innovation in certain areas, but commercialising internationally is difficult. In some areas, such as IT, the innovations are worldwide from day one.
Andy Lawton-Smith There’s bags of innovation, the issue is making that innovation global.
Andy Brooks Are we backwards looking? We see ourselves as an area built around automotive when really we’re no different from any other region in important sectors such as digital, creative and life sciences. I’m worried that if we keep on referring to manufacturing lots of people think of metal-bashing and are put off.
Graham Ashmore It’s easy to concentrate on the technology and forget the service element. I know a company in the Black Country that makes products which can be made anywhere, and the only point of differentiation is service, and that’s what enables him to export.
Peter Mathews We need to create clusters. Jaguar Land Rover’s investment at i54 will not only attract automotive but aerospace innovators, so we can concentrate interest rather than having businesses dotted around. The UK’s seen as a very reliable partner, but we don’t raise our profile: the Americans are loud and pushy, the French slick, the Germans think technically. We do not extol the virtues of what we do; we think the world owes us a living and we don’t realise we have to compete for business.
How important is building these wider teams to export innovation?
Lawton-Smith One of the elements is telling innovators you have the kernel of a good idea, but you need people with other skills to bring it to fruition and get orders. Innovators are only part of the team, but sales people are not valued anything like they should be.
Simon Jones British companies encapsulate too much within the domain of the business. They need to realise that growing and scaling can happen quicker by partnering. We have a lot of manufacturing outsourced but keep creativity in house. And that’s spreading to other functions – sales and marketing is becoming more strategic and innovative, and our route to market via partners is being enhanced.
Mathews Outsourcing and partnering is fine, but you still have to meet and eyeball your customers to understand them.
Mahoney A lot of small businesses have one driving force, a specialist in one product but not in marketing, sales or even business. It’s the golden goose syndrome: the person with the idea who thinks they can do everything, but needs external support. We must expand their knowledge, which can be done by a non-executive director or partnering.
Pam Waddell The models we need are different for different sectors. But partnership is critical in getting people from different levels of an organisation working together.
What are the hurdles for getting funding for innovation and exports?
Simon Jenner Finance is an issue for any business. Venture capital in the US is $300 and something per capita, Israel more than $200, in the UK it’s $25. You can’t compete when the difference is that marked.
Mathews We can all name loads of promising projects that could not get investment and have gone abroad. So many that it’s unbelievable.
Jones The UK’s unusual in Europe in funding university innovation. In Europe it’s 60 to 70 per cent industry-led, where it’s the other way around here. I’ve found universities here are open to working with business but are naïve about how it works. The appetite is there but it’s a matter of making them realise that there isn’t an all-or-nothing approach to funding innovation.
Lawton-Smith The economy is as good as it can be made, with tax breaks and low interest rates, but we still don’t have a culture of investing in innovative businesses. You can invest in a start-up as a private investor almost tax-free. What more can you expect? Compare that with the US, where there’s a tradition of investing in research and innovative businesses, and we’re a million miles apart.
Jones Is there an issue of innovators failing to reach beyond the Midlands for the diversity of expertise?
Waddell There’s a lot of effort from business-led consortia in bridging the gap and overcoming the valley of death – the notorious space between the invention of something to it being technology ready and marketable. A lot of stuff coming out of universities is too early stage for businesses to invest in and the universities don’t have the capability to commercialise it.
Lawton-Smith But the commercial side of the valley of death needs to be better at telling universities what it wants. It’s difficult for academics to dream up great ideas that’ll have instant commercial value. It’s implausible, impractical, impossible to anticipate what variations might be needed in worldwide markets. It’s equally important for business minds to say what they actually need.
Waddell True, but those businesses needn’t just be private sector – the government, hospitals, councils and health authorities can have a huge
impact. In Birmingham the council is looking at creating an energy ring in the centre, using bioenergy, which would be a great demonstrator.
Richard Simpson The changes in the way funding is allocated by groups like the Technology Strategy Board to research will make a difference. Research will be more aligned with industry. But even then the changes are still much too slow.
Richard Fallon I’m working on projects to convert waste into energy, and the European funding is built around the principle of keeping the commercialisation in the Midlands, benefiting 80 businesses.
Ashmore That’s encouraging because too often you take people to a recycling plant in Britain to find out it’s run by the French, full of German, Italian, Dutch and American equipment and the only British component is a simple bit of technology like a conveyor belt.
Mathews Yes, if you look at Airbus, 60 different countries make parts for one, while the average car is a global vehicle. We need to adapt to that need for global demand.
Picking up on that, how good are businesses and universities at talking to each other about their needs?
Fallon Sometimes we innovate without a clear idea of what the customer wants. We have research groups considered innovative because they publish lots of papers but what emerges isn’t practical and business won’t ever pick them up.
Simpson It’s too much to ask academics to change their thinking to commercialisation quickly, and universities move very slowly. There should be much more market pull in terms of research because technology push does not work.
Lawton-Smith We have innovation but our speed to market is so slow that by the time we get there someone else has already done it. It’s partly because universities, chambers, government and the like move at a snail’s pace. They don’t think about commercialisation, while academics don’t give a damn about the customer, they just want to publish papers.
Source: Insider Media – Kurt Jacobs, Editor