Making Innovation Flourish

Tim Berners-Lee on the future of the web

Just finished listening to Jonathan Freedland interviewing Sir Tim Berners-Lee live on stage at the Innovation Edge conference.  It's always odd seeing your heroes, and for once, he didn't disappoint.  TBL was charming, self-effacing, and more importantly, made interesting and intelligent points on the future of the web.  NESTA has helped fund the Web Science Research Initiative which he has set up, and he outlined most of his reasons for setting this up in an all-too brief video linkup.

What lessons can be learnt from the way he developed the web?
You need to give people space and time to find solutions.  Give them a chance to try and see the bigger picture, to find the generalised solution where possible.  And if you are asking or funding someone to develop a solution then don't micromanage them.  Specifically, if you tell them what to produce in too much detail  you'll end up with the same old ideas you had. 

And bear in mind that the end destination can come from left field - he quotes a possibly apocryphal story of Einstein's 'if we knew what we were doing it wouldn't be called research.'.

What are his hopes and fears for the 'adolescence of the web'?
Berners-Lee was very keen to point out the distinction between the people who use the web (and therefore the society that this creates or reflects) and the technology, or 'substrate' as he calls it, that underpins the web. 

Fundamentally, he sees the web as 'humanity interacting' or more prosaically, as 'humanity connected'.  Technology should not get in the way or dominate.  So, the web should be neutral, enabling new ways of democracy, new ways of doing science etc...
 
What is the rationale behind web science?
"We found that people doing interesting things tended to fall between various stools - computer science, psychology, economics etc.  The web needs to be thought of less as a series of connected computers to 'humanity connected'.  There are more web pages out there than neurons in your brain.   It's a very big system - one which we rely on - and it is not obvious what its properties are?   Will the blogosphere keep a check on the press?  Or will the blogosphere turn into a rumour mill and spread hatred etc - as part of a cultural revolution?
 
Is the web stable?  TBL is arguing that we need a science to understand this.  And we have a duty to understand it, so that we can take care of it.  He spoke of the unexpected or unintended effects of the micro leading the macro - eg ebay's role in driving down the prices of new items.

How fragile is the web?
Commenting on the 'megalapse' or the potential for the web to meltdown.  TBL argues it's more subtle threat than this.  Will the web be a force for the good?  The web may work fine but the society may not be one you want to live in, eg the use of email has arguably passed the tipping point of spam usage.

Is the future of innovation about collaboration?
The world is full of groups working and making their 'own language' .  The web should be making this more transparent and enabling more people to contribute.  Challenges in medical advances can only be done collaboratively, the problem is simply too big for an individual to keep in their head.  How does this work when one person's head has half the idea and if another has the other half.  How can the web help enable this solution?

Well, how can it?

*Update - podcast now online here

Part of the national character?

We're underway at the Innovation Edge.  There are thousands of people here - delegates, speakers and exhibitors.  There's a very real buzz around and it's a nice day to boot!

Chris Powell, our Chair, has set out the agenda for the day, looking to remind ourselves of the need for innovation in the first place, and to discuss where the leading edge of that innovation may be or take us.  In a broad overview of the state of innovation in the UK, he spoke of the ways that DIUS and DCMS are helping to embed innovation in the UK, and citing examples such as the Fairtrade Association of innovation in action.

Jonathan Kestenbaum, our CEO, has built on these themes by restating our mission - to improve both the capacity and climate of innovation in the UK.  He summarised it in three key areas:

• risk - NESTA is at it's best when it takes risks, experiments.  Innovation flourishes when there are a committed set of risk-takers in this country.
• the power of partnerships, collaborations.  In the diversity of disciplines, sectors and approaches comes real breakthroughs.  And it's not just us - there are a growing set of public sector, voluntary and other organisations driving this forward.
• a huge national appetite for doing things differently.  There is a common misconception that Britain has no appetite for innovation, which is simply not true.

Real innovation is not an elite activity the way it used to be - it's now part of the national character.  He left us with a quote from Bobby Kennedy - 'the future belongs to those with passion, with reason and with courage'.

Do you agree?  Is innovation now part of the British mind-set?  Do we have the right skills and attitudes, or are we on the way to develop these?

*Update - Podcasts are now being uploaded - first sessions are now online.

Preparing for the Innovation Edge

It's a little over 18 hours away from the start of our flagship conference at the Royal Festival Hall.  The organisation is buzzing, and there's a hive of activity going on making sure that the event is both an interesting, enjoyable and useful experience.

As Roland has already mentioned, we will be trying to capture a flavour of the day both on twitter and on this blog.  If you are blogging on the day, drop me a line or tag your content 'innovationedge' and I'll add you to the list.

I'm particularly curious to see how this kind of micro-blogging and backchannel will pan out with such a mixed audience.  Will it be just the social networks crowd participating?  Or will more of the policy and investments audience join in?  What lessons can we draw from this form of rapid-fire, informal, communications - and how does it relate to our other channels and methods of communication - will blogging reduce or magnify the impact of the reportage that will follow?  Are the blogerati looking forward to the same things I am?

I guess we all find out tomorrow....

Matt Rhodes at Freshnetworks is blogging the event as well

Preparing for the Future: preparing for the long-term by embracing the short-term

Young people do not seem to be under any illusions that the future working environment is going to be tough and that a job for life is no more.  This is borne out in research that we commissioned on young people’s perceptions of the future world of work and is also confirmed in our latest essay on how to equip young people for a rapidly changing world. 

In this article, 17-year-old Phil Croft argues that the future workplace is likely to be based on short-term contracts.  He puts forward some interesting suggestions for helping young people deal with this - from encouraging greater adaptability in students to facilitating more project-based work in schools.

For some students, more of an emphasis on applying their knowledge, rather than just acquiring it, is likely to improve their motivation for learning. Where the project-based learning is grounded in real challenges and dilemmas facing organisations, both learners and organisations can benefit.

We are working with Space Unlimited, a group that facilitates groups of young people to work on a particular problem posed by a company.  Space Unlimited has found that their programme provides skills development for the participating students and fresh insights for the companies.

Of course, I’m mindful that such schemes require time and resources to broker but surely the benefits outweigh this.  What do you think?

Preparing for the Future: A Generation of Mentees

Luke Skywalker knew how to be a good mentee and as a result, the whole universe was at his fingertips…..

In the second of our series on preparing young people for a rapidly changing world, entrepreneur Tom Hadfield highlights the importance of mentoring.

Tom argues that “the art of how to ask for advice from mentors, how to distil the key lessons and how to apply them to our own lives is one of the best kept secrets in education”.

This is a refreshingly novel idea. Effective mentoring benefits all parties involved. For the mentor, it provides a personal development opportunity. For young people, it encourages them to seek advice and guidance, and, as Richard Reeves argues in last week’s essay, to continually question. A successful mentoring relationship can provide young people with some of the skills likely to be needed to succeed in the future workplace, such as confidence, enquiry skills, reflection and flexibility.

Is the current education system the right environment for successful mentoring relationships to develop? Much support is given to training the mentor. But how do we support young people to ask the right questions in a environment which focuses on knowing the right answers? As always, I am keen to hear your views.

DIUS White Paper: Towards an Innovation Nation

Last summer, the Department for Innovation, Universities and Skills (DIUS) faced a significant challenge: it was a new department, charged with a wholly new responsibility, much of which depended on exerting influence across Whitehall.

The Innovation Nation White Paper demonstrates intellectual leadership, presents an ambitious new direction for UK innovation policy and lays out how the UK will keep track of its performance against this new framework. Carrying through the implications of its analysis to their full extent will be challenging for DIUS if it remains traditionally structured, and constant effort will be required to remain at the cutting edge of innovation policy.

As always, I’m keen to hear the thoughts of the NESTA community.

Making innovative places (part two - observations)

Continuing from yesterday's post - reflecting on the first NESTA Summit: Making Innovative Places, held on 12 December at NESTA's head office in London.  You can see videos of highlights from the event here.

I've tried to capture some of what I felt were the main lessons of the day - I'll post more next week.

1. History matters – James Simmie and Ron Martin from Oxford Brookes and Cambridge Universities respectively presented the interim findings of their research on path dependence.  Path dependence means that a region’s past industrial structure and performance will have a significant bearing on its future.  But like so many powerful theories, it sounds deceptively simple.  To put it in context, demonstrating this would mean thinking again (and ideally quite quickly) about cluster-creation policies and about the ‘real’ choices that cities and regions face when attempting to shape their futures.

Download the reports from the NESTA website

2. Innovation goes global – It’s always the way.  We staged a major conference about the criticality of thinking on a sub-central level about innovation policy and already the delegates were ahead of us.  Several pointed out that thinking smaller than the nation also meant automatically thinking larger than the nation too.  Firms and individuals increasingly have less respect for administrative boundaries, so why should innovators or, for that matter, innovation policy?  Luckily, our very own Sami Mahroum was at least one step ahead.  He is already talking to me about the international bent of his next research strand.

3. Don’t create, absorb!  Michael Kitson, James Simmie, Ron Martin and Paul Benneworth all addressed to various degrees the concept of ‘absorptive capacity’.  This is bedded in sound theory and masses of empirical observation – that many innovations that create value result from the identification, absorption and recombination of existing ones.  Taken to an extreme, one can imagine a highly innovative economy that creates no new knowledge but simply takes it from elsewhere, applies it to problems and creates value-generating solutions.  Thinking in these terms means thinking of universities not simply as producers of knowledge, nor as ‘transferors’ of technology, but as highways of international knowledge and homes to bright people who know where good ideas are.

Download the reports from the NESTA website

4. Leading in harmony – If it wasn’t obvious already, Richard Leese’s address at lunchtime proved that regions don’t lead themselves.  Paul Benneworth’s report took this observation to new analytical heights.  He identified not only a ‘regional innovation journey’ that stacked up remarkably robustly against the eleven case studies in his report and (by all accounts) the experience of the practitioners in the room.  His presentation was helped by his highly accessible 2x2 matrix which went on to describe four types of leadership styles through the analogy of musical groups – from a few leaders leading a lot of innovation actors (an orchestra) to lots of actors without any leadership (enthusiastic improvisational jazz).  I’m pleased that he stopped before he decided to characterise either the nations and regions of the UK and/or our leadership of this group of research projects.

Download Richard Leese's speech and Q&A (MP3) or watch them online.

Thoughts?

Making innovative places (part one)

Over the next few days I will be reflecting on the first NESTA Summit: Making Innovative Places. It was quite a day. Stephen Timms, Sir Richard Leese and AnnaLee Saxenian delivered keynote addresses and we launched three final reports, one interim report and one policy briefing. 

That all sounds very impressive but I said it then and I’ll say it again: the 90 delegates were collectively as impressive as the ‘big names’ and I hope that much of the value will live on in the connections made as much as the evidence heard and opinions formed.

‘Yesterday’ actually started on Tuesday. The Daily Telegraph picked up on a pre-publication copy of ‘Rural Innovation’ and extensively quoted Dr. Sami Mahroum, the NESTA Senior Policy Analyst who has driven our ‘place’ agenda.  In a significant article, Richard Tyler talked of a ‘new industrial revolution’ that was going ignored by central innovation policymaking. He wasn’t wrong.

 

Building effective university-industry links

Yesterday, NESTA hosted a series of events with Silicon Valley Connect that involved venture capitalists, entrepreneurs and academics from California.  The underlying topic was, inevitably, how to replicate (whatever that means) Silicon Valley’s success in the UK.

More specifically, however, the panel I chaired focused on how to stimulate university-industry collaboration.  It featured speakers from Stanford’s Media X programme, Turner Broadcasting, Google, a Stanford engineer and two representatives from the UK – from Cambridge Enterprises and UCL Advances.  A few clear themes emerged.

The most important question an entrepreneur has to answer

Sherry Coutu (in her article in the 'what I wish I'd known'  series) explains that “solving someone’s problem” is at the heart of a business.

On the face of it, it appears an obvious consideration, however, a large proportion of the companies we see can not satisfactory articulate the problem they are solving. I put it down to a reluctance of some early stage entrepreneurs to really get to know their potential customers early on in a business’s life. This hesitancy to speak to a real customer can lead to outrageous assumptions on the depth of the so called ‘problem’ that they are solving.

Answering the question ‘what problem are you solving’ is fundamental to getting to the heart of the value of your business…if that is not enough reason to reconsider this concept then consider that every sensible investor I know asks a version of this question at some point in their first meeting with a company that is looking for investment. In short it is essential that you and everyone in your business can give a clear, articulate answer.

Silicon Valley comes to the UK

What is it about Silicon Valley that still sparks so much curiosity and interest for us in the UK? Perhaps it’s driven by our quest to find a perfect solution to the UK’s own innovation landscape – or our desire to be inspired by the luminaries from the Valley who have led the world in technology innovation.

We’re delighted to announce that NESTA is bringing Silicon Valley to the UK – 17 leading entrepreneurs, venture capitalists, and university / industry collaborators will tour the UK’s ‘Golden Triangle’ - Cambridge, Oxford and London – in November.

Included in the mix are Reid Hoffman (Founder of Linked In), Megan Smith (Vice President of New Business Development at Google), and Javes Slavet (a Partner at Greylock Venture Capital).

We have an exciting range of events for students, entrepreneurs and policymakers who will have the chance to learn from the entrepreneurs about their experiences - both successes and failures - hear about the latest developments in Web 2.0 and other technology, and to consider whether the Silicon Valley model can or should be neatly translated into the UK’s innovation landscape.

View the full range of speakers or click here for details of the events that NESTA is putting on.

Promoting world class science and innovation

We have put together a commentary on the Pre-Budget Report and Comprehensive Spending Review 2007. It examines the issues of most interest to the innovation agenda and focuses on the PSA target which looks at promoting world class science and innovation.

Lord Sainsbury's Review of the Government's Science & Innovation Policies

On Friday morning, I had the honour of attending the Prime Minister’s launch, at No 10, of Lord Sainsbury's Review of the Government's Science & Innovation Policies.  He responded favourably on behalf of the Government.  Of course, firm commitments will only become clear when the Comprehensive Spending Review is released tomorrow. However, he did make four specific statements of support:

1. Bringing together funding from the TSB, RDAs and Research Councils to deploy £1bn in support of innovation over the next three years.  He said that this would be ‘written into’ this week’s public spending announcements.
2. Doubling the number of Knowledge Transfer Partnerships.
3. Launching a ‘major campaign’ to support STEM skills, building on the recommendations in the Review.
4. Forcing government departments to allocate a share of their research spend to early-stage high-tech businesses. He further confirmed that this would be recorded.

Innovation Technology: How new technologies are changing the way we innovate

NESTA’s Provocations are regular extended essays by leading thinkers that showcase
thought-provoking work on innovation.  In 'Innovation Technology: How new technologies are changing the way we innovate', David Gann and Mark Dodgson argue that a new set of technologies is emerging that enables firms to innovate more rapidly, efficiently and accurately than ever before. This 'Innovation Technology' (IvT) includes eScience, virtual reality, simulation and modelling techniques, and rapid prototyping.

Indeed, it is possible that it will have as profound an impact on economic growth and social well-being in today's knowledge economy as the development of machine tools had on the industrial economy of the mid-19th century.

Over the next decade, understanding what IvT does, how to use it and where its limitations lie will prove critical for those running businesses, working in firms and providing public services. As a result, government policy-makers at all levels would do well to appreciate its implications.

I welcome your thoughts...

The Innovation Manifesto

Suw Charman's recent exploration of the sources of innovation touches on a lot of the same themes as my earlier post and issues a warning about the current way in which people & businesses think about innovation. In reading through Suw's post, the key messages start to feel like tenets of an Innovation Manifesto (if such a thing existed*). Julia Styles summed these up nicely in her comment:

Innovation does not have a size...it can be a small change that helps solve a big problem.

Innovation is not in a vacuum, and anyone might have a solution, including young people and customers.

Innovation will succeed in business when the business accepts innovation as part of their corporate culture.

It's important to stay connected to technology and what's going on in the outside world and new media if we want to really be innovative.

And finally,
"Innovation is not a buzzword to be repeated in meetings, it's an action, a culture, a day-to-day activity."

While I agree for the most part, I'd adapt this one slightly: "Innovation will succeed in business when the business creates a corporate culture where innovation can thrive."

It's a small change, but important I think. Creating a climate that's conducive to innovation has to come first (only then will you be able to accept innovation as part of the culture). In my mind, the single biggest hindrance to innovation within a business is a culture that is closed, or overly hierarchical, or one where the pressure to perform means people can't see the forest for the trees.

I'd also add a few of my own tenets to the manifesto, namely:

• Innovation cannot be forced, and often not even planned.
• Innovation isn't always about creating something totally new. Adapting, combining and applying existing ideas in new ways can be just as innovative.

Do you have any other principles to add to the manifesto? What's your take?

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* Turns out a few others have already made a stab at their own Innovation Manifestos, including John Kao, who made his into a book (I'd be interested in your review of this if you've read it). Of those freely available online, my personal faves are this one (for its pure idealism) and Matthew May's Elegant Solutions (for its practical advice and applicability). It's also worth a look at Mind of the Innovator, another PDF from Matthew May on the eternally-inspiring site ChangeThis.

Missing the point: net radio's last stand

In the same week that NMA announced that online (download) sales now acount for 90% of British single sales (yes, ninety!), the UK Copyright Tribunal did exactly what I was hoping they wouldn't: they followed the US CRB in effecting royalty charges that could kill internet radio in the UK entirely. What's more, the UK fees will be up to 9 times the amount their US counterparts will pay. Pandora, one of the most respected US services that had only recently started broadcasting in the UK, is preparing to shut down their UK operation as early as this week.

What stations like Pandora do is provide an excellent way of selling more records. Here's how: you type in the name of a song or musician you like, and Pandora plays you music that is similar. You may never have heard of the artist or song that Pandora plays to you, but if you like it, you can buy it from iTunes or Amazon at a single click. I have no doubt that this has led to an increase in sales, especially for lesser-known artists.

The whole purpose of royalty fees is to protect composers and performers (and of course record companies) by compensating them each time their song is played in public, thus generating income for them. But actions like the new net radio fees will only end up hurting music sales, which generate more income than royalties. The UK Copyright Tribunal and the US CRB have effectively killed off one of music's cheapest and most effective marketing tools.

Until regulatory bodies like this recognise that the world has changed around them and learn to adapt their ways of working to account for the digital age, it's a lose-lose situation. Regulation needs to evolve to support innovative business models like internet radio, or nobody wins.

Launching 'The Disrupters'

I am pleased to announce the latest report from NESTA Policy and Research Unit (NPRU).

The Disrupters: lessons for low-carbon innovation from the new wave of environmental pioneers tells the stories of eight businesses and organisations that are pursuing low-carbon goals by putting into practice new business models or services, or cheaper and simpler alternatives to existing products or services. The report argues that while our efforts to reduce carbon emissions could benefit from these disruptive forms of innovation (perhaps more effectively than through pumping money into more radical technology-based forms of innovation), the UK is currently not set up to encourage them and the entrepreneurs that drive them – in fact, they are frequently thwarted. The report was the subject of a recent Daily Telegraph article and was launched last week in conjunction with NESTA’s latest ‘Innovation Challenge’ around the issue of climate change.

• More details and download a PDF of The Disrupters
• Download the accompanying Policy Briefing - New types of innovation for a low-carbon society.
• Video of Rebecca Willis, co-author, presenting The Disrupters at our Environment Challenge launch

Internet radio: how regulation could impact online innovation

Today internet radio stations in the US are observing a day of silence to protest the Copyright Royalty Board (CRB)'s decision to hike royalty fees for internet radio stations - a hike of 3-12 times the fees currently being paid by stations. Small stations have complained that the fees would be more than their annual revenue, and many pundits argue that this could effectively 'kill' streaming internet radio in America. Even non-profit radio, such as NPR (National Public Radio) would be severely hit by the hike.

Roughly 1 in 5 Americans listened to internet radio regularly in 2006, so the potential impact shouldn't be underestimated. For reference, on this side of the pond, the picture is much the same: BBC's internet radio doubled its listenership in 5 months, and a year ago reported over 32million hours of net radio consumption (I'm sure it's doubled again by now).

To me, the tragic irony in this story is the fact that the proposed royalty fee model could never have existed without the online medium itself. The fees are per song, per listener - something which could never be accurately measured in the old broadcast model, but suddenly is possible for online stations due to the trackable nature of streaming media. Net radio campaigners say this is an unfair model, as it penalises online radio unjustly compared to satellite or standard broadcast radio fees.

Internet radio is the epitome of The Long Tail at work: thousands of small, non-commercial niche stations sprang up as an alternative to mainstream commercial stations littered with ads, churning out the same playlist over and over. A thriving new business model emerged based on broadband penetration, streaming media technology and consumer demand; a perfect example of innovation at work.

Looking at the bigger picture, this is a case in point of how something like regulation could seriously impact the growth of an innovative business model. What nascent markets like these need is not overbearing regulation, but forward-thinking. Of course I'm not saying they shouldn't pay (fair) fees, but this was a missed opportunity for the CRB to demonstrate leadership in the way intellectual property should be managed in the digital age. Instead, they opted for an approach that exploits the nature of the new medium to line the pockets of the record companies: none of the proposed fees would go to the recording artists.

Innovation policy needs to be more like innovation

The innovation that matters most differs between sectors. Obvious really, but it’s easier to recognise than it is to design policy for.

NESTA’s new research report, Hidden Innovation, examines six sectors that, at least according to traditional measures like R&D, have low rates of innovation. But sectors such as oil production and construction do innovate, just in different ways. In oil production, innovation is the development and application of technologies in the field. In construction, it’s more about the adoption of new working methods and materials. Neither form of innovation is based primarily on university or corporate lab research which is then applied and commercialised – the so-called linear model of innovation.

The new policy agenda for innovation – developing approaches that stimulate and support the different forms of innovation that matter in different sectors – will need a new approach to policy development. In effect, in the past we have relied on a linear model for policy development: do some research (privately); analyse the results; develop and launch a pilot programme; evaluate the impact before deciding whether to roll-out as a full ‘product’.

Much innovation in industry no longer works in this way. It’s collaborative, interactive, incremental, experimental, open. Not words usually associated with policy development, let alone politics.

At the event to launch the NESTA research, Alistair Darling, Secretary of State for Trade and Industry (and possibly the next Chancellor of the Exchequer) announced the intention to form ‘sector innovation groups’ with industry partners (and NESTA) to discuss and develop new policies to support innovation in service sectors of the economy. [You can watch his speech here] Does this approach – potentially innovative in itself - represent the future of policy development for innovation?

Ideo, Interdisciplinarity and Enterprise

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From lightbulbs to 3D TV

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Last week I was fortunate to spend a day at the High Tech Campus in Eindhoven in the Netherlands. The site itself is very impressive and hosts around 5000 engineers working on new technologies with ‘Open Innovation’ as their motto. And yet as recently as 2003, the site used to host just one big company, Philips.

Philips made a very deliberate decision to open up the way they operate, and the way they innovate. A clear indication of how things hare changed in a short space of time is the fact that there are now hosts over 40 businesses academic research institute and network called MiPlaza where companies share equipment and services such as cleanrooms. As a symbolic move, in 2005 they even removed the Philips sign at the entrance to the site, despite the major historical connections with the site.

We were fortunate to hear their Chief Technology Officer talk about their approach to open innovation. They now realise that it is much easier to sell successful businesses than it is to sell new technologies, and so they active spin out companies or technologies in the same was as many Universities.

I always find it fascinated to see how organisations re-invent themselves but this was made blatantly clear when we saw how Philips has moved on from starting out in lighting, progressing into Consumer Electronics, and now with a major focus is on Healthcare. The best ‘I want one of those’ moments came when they showcased a pretty spectacular 3D TV – like 3D cinema but without the cardboard red and green specs.

I am struck by the desire and ambition of companies like Philips to engage with ‘the outside world’ in a proactive way, and the opportunities for smaller companies, universities or individuals are significant, though it’s not always easy. Therefore, the theme of corporate open innovation is one of the three core themes that we will investigate through NESTA Connect launching in 2 weeks tomorrow and we’ll post again on this subject over the coming months.

Social web for social issues

This morning's news about a screensaver and online social network for Alzheimer's sufferers and their carers is exactly the kind of social innovation the Innovation Challenges team are exploring. The screensaver is a simple application with the "why didn't I think of that" factor: a carer and person with dementia can upload text, video and photos to the screensaver to help them remember important people, moments and facts about their lives. It's great when an existing technology like this can be adopted and put to good use. If the social network element works well, I can see that being taken up by folks without Alzheimer's as well. Millions of elderly people live alone, and this could be their connection to other people out there. Sure, it's not the same as actual physical contact, and some considerations would need to be made for those not familiar with computers, but it could just be the lifeline that keeps lonely elderly people going.

Difference drives innovation...

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In my experience, homogeneity of skills, influences, opinions, ideas, competencies, knowledge and cultures, can only lead to conformity of views and the maintance of the status quo.

More interestingly (to me at least), differences in skills, influences, opinions, ideas, competencies, knowledge and cultures, can lead to one of 2 potential outcomes:

1. Firstly differences can descend into chaos, fragmentation and highly un-productive activity, or
2. If managed well, differences can lead to a highly creativity, inspiring and innovative environment.

The key question is, of course, how to you set things up so that you create the latter innovate outcome, rather than the former. The short answer from me (at the moment) is that I'm not sure, however we are in the process of trying to find out.

Nesta launches a new programme on June 14th called Connect, which seeks to prove that new, unexpected or extreme collaborations drive innovation. Our key lines or enquiry are centred around differences, networks, interactions and trust. It's a fascinating subject which spans psychology, solciology, antrohopoly, technology, economics and politics, so we've got our work cut out for us. We'll post on this blog as and when we find out more.

Trust, technology and transliteracy

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I attended an event on 'Transliteracy'€™ at the Institute of Creative Technologies (IOCT) at De Montford University yesterday. As a simple soul, I normally like to shy away from words of more than 3 or so syllables and from difficult (to say) concepts such as ‘interdisciplinarity’ and ‘transliteracy’. Having said that, I was intrigued by the work Prof Sue Thomas and her colleagues are doing at the IOCT so decided to participate.

Transliteracy is fundamentally it is about communicating effectively in different ways and sometimes using different technologies, but has a much more detailed definition you can find here.

Effective communication and building trust gets a lot more difficult when technology is involved as you don’t have the usual body language and eye contact that we often take for granted in face to face interaction. Blogs, social networks or online environments like Second Life, all have their own cultures and etiquette, which are often not obvious to the uninitiated.

Also, it is often said that something like 95% of communication is non-verbal. If this true, then there are real challenges to communicate across distance using technology, which is usually text based. The style of communication also varies massively depending on the communication channel (e.g. irony is difficult in email as I frequently discover to my cost, small talk is the norm at the beginning of face-2-face meetings but not in some other forms of communication etc.).

In particular, when talking about stimulating innovation, I would argue that all innovation is fundamentally collaborative. With increasing specialisation in business and academia in recent years, this has led to an increasing need for organisations and individuals to develop wider, more open networks, partnerships and trusted communities to share ideas and to innovate. In particular, a powerful source of innovation is to collaborate across traditional boundaries, be they organisational, disciplinary or geographic.

Therefore, much of the discussion centred upon how can we communicate effectively and build trust across these disparate communities. Technology definitely has a major role to play in supporting these boundary-disrupting collaborations, but perhaps there is a need to further develop most peoples ‘transliteracy’ skills (idea for a future Nesta programme perhaps).

Another possibly interesting observation (to me at least) was that, through the use of technology, it may reduce the need for facilitators or super-connectors (which are critical in off-line collaborations) because more background information is typically available in a technology facilitated collaboration. For example, it can be easier to ‘scan the room’ for interesting people to talk to in an online environment where peoples profiles are there for everybody to see. If only most networking events or parties were so easy to navigate. And yet, if you are unfortunate enough to get stuck in the (virtual) corner talking to that boring bloke who just split up with his girlfriend and he wants you to talk through it’s last days of their relationship in real time, it is still far easier to ‘exit stage left’.

I’m pleased to say that the event was interesting and populated with a diverse and interesting bunch of people, who surprisingly were not technologists, but included sociologists, anthropologists, musicians, writers and a museum curator! We probably posed more questions than answered, but I guess that is par for the course at this stage. As de Bono argues in his book ‘Lateral Thinking’, it is important to suspend judgement and not kill off an idea too early until it is more fully formed. I think there is still a lot to do with this concept of transliteracy, but it certainly provided some food for thought.

PS. Being flippant for a moment, I am increasingly conscious of the trend to coin a phrase ‘xyz’ and then for ever more being referred to as the person who coined that phrase/term/meme. Transliteracy could be included in this category, as could crowdsourcing, web 2.0, the long tail, the wisdom of crowds and many more. I want to capture the zeitgeist by coining a new meta-phrase which encapsulates this phenomenon – how about ‘coinification’? As in “that’s just utter coinification”. :)

Where are the Brits?

This month BusinessWeek published their special report on The World's Most Innovative Companies. In looking at the top 50 table, I see that only 2 of the companies are registered in the UK: Virgin and BP. When you delve a little deeper and look at the sector breakdown, things start to get a little more interesting.

Previously unmentioned Tesco comes in at number 9 in Retail and Virgin quite naturally appears near the top (no 2) in Travel/Tourism/Hospitality.

But in the Energy category, the UK starts to shine a little more:
No 1: BP
No 3: Royal Dutch Shell
No 10: EDF Energy

I'm not sure what measures BusinessWeek are using to come up with the results, but it's interesting to see British companies making such a strong showing in the Energy category.

For an excellent commentary that delves beneath the results, have a look at Jena McGregor's piece for Yahoo!

Top 5 things innovation doesn't need

As it applies to business, I've been noticing the growing trend of 'innovation' becoming a buzzword that's all hype, no substance. Lots of attention has been garnered on businesses' need to be more innovative, but this only results in endless lists of shortcuts to getting folks to 'think outside the box' (I hate that phrase!). The focus seems to be on an innovation to-do list of things you can magically implement to result in instant innovation, rather than looking at the culture of innovative companies that leads to fresh, unorthodox ideas being allowed to rise to the top. In response to all these lists, I've created my top 5 list of things that businesses do/don't need in order to become more innovative.

Top 5 things that innovation doesn't need:

1. A dedicated Innovation department
2. Continual and incorrect use of the word 'innovative' as a synonym for 'new'
3. 'Innovate or die' pressure to innovate quickly
4. Quirky or arty 'idea spaces' designed with ultimate feng shui to get ideas flowing
5. Treatment of innovation as yet another formal 'thing' to be implemented, such as a performance management system or issue-tracking process

Top 5 things innovation needs to thrive:

1. A culture that recognises 'failure' as simply another way to say 'learning & growing by trying'
2. A culture that embraces and rewards cross-team and collaborative working
3. Openness and readiness to learn from your customers, suppliers and other contacts
4. Broad understanding that innovation can be painful, expensive and/or slow
5. Recognition for innovation that takes place outside R&D departments and/or from below manager level

Corporate Open Innovation - Hype or Reality?

I attended and spoke at a very well run City-Zone networking event on Corporate Open Innovation on Wednesday which had a lively debate around this theme. The room seemed to be split as to whether 'open innovation' was truly a new phenomenon or just the latest management fad. Proctor and Gamble and Oracle presented how they are actively engaging their supply chain, small companies, or customers to innovate. I added to these examples and talked about how IBM in particular are taking a very enlightened approach to innovation as described in their Global Innovation Outlook report.

My own view is that there is undoubtedly hype and spin around the theme of 'open innovation' at the moment, and the reality of innovating and managing IP is a particular problem that needs resolving. Having said that, I believe the evidence that open networking and partnering leads to better, and more innovation, and is increasingly the way innovation is happening and will happen in the future. I find the work of Lakhani and Burt compelling in this area. Corporates have strong brands and the infrastructure to take a product or service to market. But the enthusiasm, ideas and ability to execute often lies outside of the business. Therefore, I believe we are seeing a new way of working and innovating emerging but there is still a long way to go.

Corporation tax

Northern Ireland's proposal to the Treasury that it should have the ability to reduce corporation tax is an audacious move.  If awarded (or even considered seriously) it begins a new phase in the development of regional innovation strategies, and one that may not be healthy.

Defining innovation

In our monthly e-mail newsletter we pointed our readers at the DTI's definition of innovation ("the successful exploitation of new ideas") and asked them to respond with their own definition of innovation. Phil Burkhard responded with:

"Innovation is the successful application of an idea to improve anyone or anything in order to achieve a dramatic and beneficial outcome. It is narrow and distances people if it is just confined to the commercialisation of ideas, products, technology, R&D, the private sector, people in white coats, mavericks or lucky flashes of inspiration!"

I agree with Phil that the usual definition - which tends to focus on R&D and commercial application of technology - isn't broad enough. But in broadening the definition, another stumbling block gets in the way: how do you determine what is innovation, and what's just improvement? In my mind, incremental innovation is a valid and important type of innovation, but surely we need to distinguish between innovation and improvement if we are ever going to find an accurate way to measure the UK's ability to innovate.
 

Uploading...Innovation

I'm really excited about today's Uploading...Innovation event at NESTA. We have a great group of people coming from all kinds of different backgrounds, the commonality being that they are all building innovation communities on the web. To get things moving we have invited a number of people to deliver short sharp provocations and host the conversations that flow from them – maximum three minutes long – and the following people have accepted this challenge:

• Charles Leadbeater on the ideas behind his new book We Think
• Mark Earls on our herding instincts 
• Molly Webb on the insights emerging from the DEMOS project The Atlas of Ideas
• Dan McQuillan from Amnesty on using social media in campaigning
• Johnnie Moore and James Cherkoff will invite you to come together to co-create
• Mark Vanderbeeken from Experientia on a distinctive European approach to user centred innovation
• Jeremy Ettinghausen from Penguin on the crowdsourcing novel www.amillionpenguins.com

Otherwise, the event is open and democratic and anybody can suggest a topic of conversation, but with the group of people we have coming I don't think we'll be short of opinions. I'll post again during or after the event with an update, otherwise keep an eye on the event site here for pictures, posts and video clips.

Patents are not innovation

The report from the World Intellectual Property Organisation (Times, 21 February) stating that the UK is falling behind its global competitors, with regard to innovation, certainly makes for an alarming headline. But it doesn’t tell the full story: patents are not innovation.

Measuring innovation solely by traditional metrics, like patents or R&D spend, leads to a strong bias on scientific and technological invention. It completely fails to recognise innovation that is occurring in other areas of the economy like financial services, software, construction or oil and gas exploration.

NESTA’s recent report, ‘The Innovation Gap’, shows that when traditional innovation metrics are adjusted to reflect the make-up of our economy, the gap between the UK and other leading countries closes by as much as 80%. Worryingly, where innovation is not measured, little effort is put into encouraging it.

This is particularly concerning in service industries which make up around 74% of the UK’s economy and hold the key to our economic future in the face of increasing global competition.

We need to build on the Government’s commitment to innovation in science and technology and develop a tailor-made national policy to support innovation across the whole economy and wider society.

Innovation as a contact sport

There is a lot of talk at present regarding the importance of collaboration/open innovation and networking, and I would argue that innovation almost always happens through collaboration, rather than in isolation. However, the essence of successful collaboration is often dominated by anecdote and opinion, and hard facts or data are limited to the best of my knowledge. As with any meeting of individuals or organisations, it is critical that participants can find a common language, so that they can communicate and collaborate, and build trust.

Therefore we are in the process of developing a new programme, called NESTA Connect, that will focus upon finding and supporting unexpected, novel or extreme collaborations that disrupt the boundaries between different disciplines, organisations and places. The intention being to examine and explore the essence of successful collaboration and then showcase the best of the best models and collaborators.

We know that we cannot begin such an endeavour without tapping into and harnessing the extraordinary network effects of the Web to connect people to one another, to promote co-creation and harness collective intelligence. Therefore I am delighted that NESTA are hosting 150 of the leading online collaboratives at an event next Tuesday called Uploading Innovation (NB this event is full).

I am particularly interested to share experiences of the ways in which people engage online rather than focussing upon the technology side of things, and are also keen to understand the impact that online communities having on communities centred on physical locations or places? I'll post again after the event to feedback the key findings from the day, but any thoughts or comments on any of the above would be of interest.

EC proposals: an example of how regulation can drive innovation

The European Commission has proposed forcing carmakers to cut the CO2 emissions from new cars by 18%, by 2012. It says it is planning legislation to ensure that all new cars emit no more than 130g of CO2 per kilometre, compared with an average of 162g/km for cars sold in 2005. This has led to predictable uproar: car-makers say that the limit is “arbitrary” and will hurt their business; environmentalists say that it doesn’t go far enough. Both are missing the point.

Better emissions standards are of course better for the environment.  They will also cause short-term disruption to the lives of those in the automotive industry (although they must have known that they were coming), but from the point of view of innovation, this is a great example of intelligent regulation that could position Europe’s car industry for explosive growth when the rest of the world catches up with the Commission’s proposals.

As Luke Georghiou makes clear in Demanding Innovation, performance-based regulations like this can force the EU’s industries to develop world-leading technologies that can position them for rapid dominance when those technologies become more widely demanded. Correctly implemented, this move could prove a living case study of the impact of intelligent regulation on stimulating innovation.