Workshop explores how UK Industry might measure its ability to innovate

With the theme ‘Innovation – Measuring for Successful Delivery’, and contributing to the wider debate on UK Innovation, the workshop focused on how an organisation’s innovative strengths can be measured. The event’s results are being submitted as the West Midlands contribution to a UK-wide debate initiated by the Department of Innovation Universities and Skills (DUIS).

Despite Science and Innovation Minister, Ian Pearson’s having declared innovation to be ‘a key driver of UK prosperity in the decades ahead’, a recent study by Birmingham City University’s leading automotive engineering specialist, Professor Adrian Cole, found significant causes for concern, particularly in auto-sector. Prof Cole commented: “We found short-term, often customer-driven, urgency dominated long-term innovation. Top managers may believe their companies perform well in innovation, but line managers and technical staff are often frustrated, because short-term demands dominate.”

Following this research, Government white paper, ‘Innovation Nation’, stated its aim was ‘to make the UK the best place in the world to run an innovative business or public service.’ It argued that ‘innovation is essential to the UK's future prosperity and ability to tackle major challenges like climate change.’ A key recommendation was ‘to pilot a new Innovation Index in 2009 to measure UK innovation performance’, as it is difficult to improve something if there is no agreement as to how to measure it. A pilot is being managed by the National Endowment for Science, Technology and the Arts (NESTA) and the WMRO/TIC-led workshop was run to develop a concerted West Midlands’ viewpoint on the Innovation Index concept.

To help assess just how to measure the effectiveness and improvement in innovation, the workshop heard from the CBI’s Head of Innovation, Science and Technology, Dr Tim Bradshaw. He referred to a recent study of innovation performance in the service sector, by the CBI and Qinetiq. This explored best practice, identifying areas which can’t be costed, but are crucial to innovative success. The study’s results identified the need to develop an ‘innovation culture’, with mutual trust among staff to remove fear of failure, since many innovative projects inevitably fail. A company’s innovation activity was also found to need influential champions, and the importance of design was emphasised, with a need to encourage technical staff to persistently review data relevant to innovation.

Warwick Business School’s Professor Stephen Roper illustrated an approach to innovation measurement based on the Europe-wide Community Innovation Survey (CIS) data. The performance of over 550 West Midlands firms was compared to a similar in-depth exercise with businesses in the US State of Georgia. Aspects included R&D spend, new product introductions, training, quality of links with universities, suppliers and customers, as well as employment growth. The results showed firms in Georgia gaining more external help such as that from universities, whilst their West Midlands counterparts seemed better at exploiting internal and external collaboration.

Dr Phil Extance, Advantage West Midlands’ Director of Innovation, told the Workshop the thrust of Birmingham’s ‘Science City’ initiative could be a basis for greater use of the region’s research expertise. Knowledge transfer from universities and other educational institutions into business could stimulate more R&D and innovation. Support for new businesses was also key.

Co-host WMRO’s Economist, Brian Macaulay, is co-ordinating the workshop’s response to NESTA and DUIS. Birmingham City University’s Prof Adrian Cole commented: “The workshop’s presentations revealed a need for both qualitative and quantitative approaches to measure firms’ innovative performance. Such measures shouldn’t just comprise simple, single-number indexes”. He added: “Greater involvement of Industry with universities in applied research and innovative solutions can be very significant in making real progress in innovation performance, whatever measurement is used.”