Making universities work to beat the recession

Whilst much of the focus has been on the negative aspects of the current recession and its impact on the business sector, it must not be forgotten that a strong knowledge base and the ability to exploit new technological and market opportunities are critical components in any plan to emerge successfully from the current economic crisis.

The higher education sector, in particular, has an important contribution to make to this process, especially as perception of universities as mere institutions of higher learning has, during the last decade, given way to a view that they are important engines of economic growth and development.

The key question is how programmes can be developed which create innovation-based strengths such as the ability to develop new products, access successfully new markets, apply new technology, incorporate best practice in the management of enterprises and develop skill levels across the full spectrum of the labour force, as these are what will lead to rapid economic recovery and, more importantly, sustained competitiveness.

It is generally agreed that one of the real policy challenges, not only in peripheral regions such as Wales, but across Europe, is how to create an indigenous knowledge-based sector that can create wealth and employment as found in areas such as Silicon Valley and around MIT in the USA. That is where universities have a vital role to play.

Some would argue that the university’s economic role should be limited to the creation of spin-offs and patents from academic research, especially as we hear stories about scientists creating hundreds of millions of pounds of income through the exploitation of a new technology. However, such stories, although inspirational, are few and far between.

Whilst not as glamorous as creating high technology firms, universities can play a valuable role in directly transferring both technological expertise and knowledge to local entrepreneurial ventures. Various studies have shown that consulting by academics and engineers can be the most versatile and cost-effective means of linking industry with the university sector.

This is because it is a relatively inexpensive, rapid and selective means of transferring information with few institutional tensions and it rarely involves extensive demands on university personnel and material resources. It is recognised as the most effective two-way channel between university and industry, often leading to other forms of co-operation. Academic scientists and engineers who engage in consulting acquire knowledge about the needs of industry and can therefore identify how these needs can be met by the university sector.

It is a win-win situation for both university and the business sector and it is not surprising that economic development agencies have created different vehicles to enable this to happen. The most successful programme of its type is ‘innovation vouchers’, a concept which began in Austria and which was recently recognised by the European Commission as one of the top ten “good practices” on how to make life easier for SMEs from all over Europe.

Its beauty is its simplicity – the innovation vouchers scheme is designed to help businesses to purchase academic expertise from universities to support innovation and business improvement. The voucher entitles businesses to purchase specialist consultancy up to a certain value, usually less than £5000. There is little bureaucracy as the voucher is easy to apply for, easy to spend and the costs to run it are relatively cheap.

Not surprisingly, other regional development agencies across Europe, including those in England, have adopted the scheme although it has yet to be implemented in Wales.

During the 1990s, I was director of a major transnational research project which examined links between universities and industry across seven European countries. Our conclusions at the time were that the key factor contributing to the success of the different initiatives was the acknowledgement and incorporation of mutually beneficial activities for all partners involved and an awareness of the economy in which they participate.

Often this isn’t easy because the evidence suggests that there this is due to a clash of two quite different organisational cultures. On one hand, the traditional culture within many academic institutions does not encourage the development of links with small-scale industry. On the other hand, there is a general reluctance by small firms to become involved in relationships with their local universities although large companies regularly access universities for external sources of technological expertise.

Clearly locally-based programmes such as innovation vouchers address this issue by enabling small companies to become comfortable with the knowledge and expertise that their local universities can offer them before potentially creating more in-depth relationships that can lead to substantial projects such as Knowledge Transfer Partnerships (KTP).

Through working with small businesses that are desperate to grow and develop their technology and skill base, such programmes could enable the higher education sector to finally banish its image as a group of ivory towers that have little do with the business community.

More importantly, these initiatives, which bring the academic and the entrepreneur closer together, have the potential to maximise opportunities in enabling the university sector to support businesses and, more importantly, to assist them out of recession.

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