i3l powertalk presentation on innovation systems: implications for research and policy by dr andy...

Innovation systems: Implications for research and policyI3L Powertalk

AGRICULTURE

Dr Andy Hall • CSIRO Research Group Leader – Innovation Dynamics for effective agriculture systems (IDEAS)

5 February 2016

Outline

• The challenge of moblising science for innovation.

• Defining innovation.

• Technology in a system of use.

• Systems of continuous innovation.

• Role of public research and the private sector

Innovation systems: implications for research and policy • Dr Andy Hall2 |

The challenge and the paradox

• Science is the most powerful tool for discover and knowledge creation know to

human kind. Ever. And we are getting better at it all the time.

• Business and entrepreneurship is the most powerful tool for driving innovation that

delivery products and services we need and for making money. Ever. And we are

getting better at it all the time.

• Yet scientific research organisations are under intense pressure not just to

demonstrate scientific excellence.

• To be an agent of innovation, an innovation catalyst, an innovation hub, to be client

focused and to demonstrate contributions to social and economic impacts.

• What does that mean and what is this innovation thing that we are been asked to

do?


Innovation: the simple meaning

• Research turns money into ideas. Innovation turns ideas into

money.

• A process that combines:

– Technological break - throughs or inventions: The creation of ideas from

research, but also from other sources.

– Technological artifacts: The embodiment of technology and ideas in new

products and services

– Using ideas for gain: The actions, practices and conditions that allow ideas

to be put into productive use.


Innovation: more meaning

• The process of creating and putting into use combinations of knowledge from many

different sources

• This knowledge may be brand-new, but usually it is new combinations of existing

knowledge

• Not research or technology, but might involve both.

• To be termed innovation, the use of this knowledge has to be novel to the farmer or

the firm, neighbours and competitors, but not necessarily new globally

• Invention, on the other hand, is the creation of new knowledge new to the world,

usually by research organisations, but also by artisans and others

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Different ways of organising agriculture innovation• Dr Andy Hall

Innovation systems: implications for research and policy • Dr Andy Hall

Technology in a system of use

Technology is an important component of innovation but for it to have social and economic value it needs to be part of a system to enable its use.

• New crop varieties

• Aeronautical engineering


New crop varieties in a system of use

• Crop variety with higher performing characteristics

• Mechanisms for articulating farmer and consumer demand for new

characteristics

• Accompanying technical changes: water management, agronomy, pest

control.

• Changes in input and output markets (seed supply, procurement)

• Farmer organizations to negotiate prices and create markets for new

crop.

• Policy changes: price policy for inputs and outputs, regulation of credit,

seed certifications


Aeronautical engineering for passenger line travel

• Technological push from jet engine technology, aircraft design and

navigation systems.

• Accompanying technologies and systems: air traffic control systems, flight

scheduling, travel agents, policy, regulation and safety standards, catering

services (disgusting though their food maybe), airport infrastructure etc.

• continuous process of upgrading and innovation. The low cost airlines

revolution; on-line booking and e-ticketing.

• Not only technology driven innovation, but consumer driven innovation

enabled by technology


Different types of innovation?

• Technological innovation: Farmers adopting a new crop variety, a

new agronomic practice, or animal feeding regime.

• Organizational innovation: farmers work collectively to market

produce.

• Institutional innovation. Researchers form new partnerships with

farmers and companies to deliver solutions that give income and

profits

9 | Innovation systems: implications for research and policy • Dr Andy Hall

What does innovation look like?

• Business innovation: companies develop new products

and service or new ways of delivering these that create

profit and other value.

• Value chain innovation: Value chain actors use new

ways to procure, add value or market products.

• Policy innovation: regulations, rules and incentives

that add value to social and economic activity. Food

standards, pesticide approvals, new ways of financing

farming and business investment.

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How does innovation happen?

• There are broadly 2 views.

• A technology transfer pipeline view

• A “systems” views that suggests different

types of innovation need to be coupled

together.

• Neither can be universally correct.

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What do we know about how innovation happens?

• Entrepreneurs are the driving force with motivation to search out

opportunities to extract value from ideas.

• Innovation emerges from a dense network of interaction which allows ideas to

flow and be shared and which allows different ideas to be combined in new

ways.

• Partnerships and other business and social relations help this.

• Routines and other learnt behaviors that make interaction standard practice in

organization are a key element of innovation capability in both the public and

private sectors.

• Innovation is not just risky but is highly uncertain and unpredictable as it

emerges from a complex system of interaction


What is an innovation system?

Networks of organizations or actors, together with the

institutions and policies that affect their innovative

behaviour and performance, continuously bring new

products, new processes and new forms of organization

into economic and social use.



“Innovation systems” view

Technology triggers

Market triggers

Social triggers

Environmental triggers

Research Organisations

Enterprises

Support Organisations

Markets and Consumers

“Go - between” Organisations

Protocols

Enabling Policy Environment

Innovations of

economic, environment

al or social significance

New capacity to innovate

An “innovation ecosystem” view of an agri-food innovation system (after Hall 2012)

Some implications and missunderstandings

• Research needs to become a more responsive element of the innovation

system (consumer clients, business clients, policy clients).

• Investments by organisations needed in building partnerships and links.

• Investments by organisations in learning routines that strengthen

interaction, knowledge sharing and access.

• X The market will invest in innovation brokering and intermediation to

build dense networks of interaction.

• X All research must respond to the needs of the market


Role of the public sector in enabling innovation.

• Setting framework conditions, policy, regulation, infrastructure, law and order.

• Addressing market systems failures: tax credits for R&D in the private sector,

public good applied research.

• Addressing innovation systems failures?

• Creating mechanisms to promote non-market interactions that underpin

innovation (long term public private sector interface)

• Investing in research and market development in uncertain innovation

trajectories that can create new economic sectors (biotech, ICT, nano-tech etc)

• Investing in innovation trajectories with high social value: renewable energy

and green technology generally, food waste and nutrition, inclusive innovation.


Innovation systems demands more and different public investment not less

• Mazzucato (2013) argues for an urgent need for “Mission-mode public

investment” in opening up new innovation trajectories and associated markets.

• Investment in research, business capacity development and associated

innovation support services and financing and investment.

• Priorities are likely to involve technological innovation opportunities that sit

across existing areas of research, to uncertain to rely on the private sector alone

in its formative stages

• Efforts to develop business opportunities and markets around these, with close

public private sector partnership.

Presentation title • Presenter name17 |

Paradox of the smart phone

• Icon of private entrepreneurial led hi-tech innovation … Or is it?

• Did consumers articulate a demand for smart phones? Or did

technology create that demand?

• Never the less a plethora of transformational impacts on every

sector of the economy and in fact society as a whole

• The key technical innovations came from private investment in

R&D. Right? Wrong!


Presentation title • Presenter name19 |

Public investments that make the iPhone ‘smart’ (source Mazzucato, 2013a, p. 109)

Some concluding conundrums

• Innovation is not research or technology, but may involve both.

• Innovation is not supply led or demand led, but involves the iteration between

opportunities and needs.

• Market failures create risks that prevent private investment, innovation is

uncertain and requires public investments.

• Innovation performance has a rate, but also a direction that can not be left to

the market alone.

• Business innovation is a critical driver of economic growth, but this requires a

more entrepreneurial, proactive role for the public sector not a smaller hands

off approach.


Andy Hall, CSIROLevel 1 Ecosystem Science Building, Black Mountain Laboratories, Clunies Ross Rd, Acton, ACT 2602TEL. +61 477 735 [email protected]

AGRICULTURE

Thank you