Sociedade Portuguesa de Inovação Tuesday, June 21 st, 2005 3,5/3,5 CM Innovation in America

Sociedade Portuguesa de Inovação

Tuesday, June 21st, 2005

3,5/3,5 CM 3,5/3,5 CM 3,5/3,5 CM 3,5/3,5 CM

Innovation in AmericaInnovation in America

Innovation in America CRCiJune 2005 by Elia Cossis

Innovation in America

ObjectiveObjective

To give the audience a general overview of America’s national innovation initiatives and priorities;



AgendaAgenda

1. America’s national innovation agenda

2. America’s Innovation opportunities and challenges

3. The new shape of innovation in America

4. The innovation ecosystem defined by America

5. Looking ahead



America’s TaskAmerica’s Task

Innovation has always been deep in America’s soul Innovation has always been deep in America’s soul from the nation’s birth 228 years ago.from the nation’s birth 228 years ago.

For the past 25 years, America has optimized its organizations for efficiency and quality. Over the next quarter century, America must optimize its entire society for innovation.



America’s RoleAmerica’s Role

America has fundamentally been about exploration, America has fundamentally been about exploration, opportunity and discovery.opportunity and discovery.

“The legacy America bequeaths to its children will depend on the creativity and commitment of our nation to lead a new era of prosperity at home and abroad”, Council of Competitiveness



America’s ChallengeAmerica’s Challenge Innovation itself, where it comes from and how it Innovation itself, where it comes from and how it

creates value is changing. It requires a new vision, creates value is changing. It requires a new vision, new approaches and new action plan new approaches and new action plan

To unleash its innovation capacity to drive productivity, standard of living and leadership in global markets.

Macro-economic forces and financial constraints make innovation-driven growth a more urgent imperative than ever before.

American business, government, workers and universities face an unprecedented acceleration of global change, relentless pressure for short-term results, and fierce competition from countries that seek an innovation driven future for themselves.



1. 1. National Innovation AgendaNational Innovation Agenda



Three categories of the Three categories of the national innovation agendanational innovation agenda

I. Talent

II. Infrastructure

III. Investment



Talent InitiativesTalent Initiatives

The lifeline of innovation starts with human capital and the The lifeline of innovation starts with human capital and the ability to be creative. ability to be creative.

Building a national innovation education strategy for a diverse, innovative and technically-trained workforce;

Catalyzing the next generation of American innovators;

Empowering workers to succeed in the Global Economy.



Investment InitiativesInvestment Initiatives

Money, incentives and risk are necessary investment for Money, incentives and risk are necessary investment for promoting innovation.promoting innovation.

Revitalizing frontier and multidisciplinary research;

Energizing the entrepreneurial economy;

Reinforcing risk-taking and long-term investment.



Infrastructure InitiativesInfrastructure Initiatives

The right means for creating innovation.The right means for creating innovation.

Creating a national consensus for innovation growth strategies;

Creating a 21st century intellectual property regime;

Strengthening America’s manufacturing capacity;

Building 21st century innovation infrastructure – the health care test bed



2. Innovation Opportunties and Challenges in 2. Innovation Opportunties and Challenges in AmericaAmerica



Innovation OpportunitiesInnovation Opportunities

21st Century opportunities for innovation lie in many areas.21st Century opportunities for innovation lie in many areas.

Promise of environmentally friendly and plentiful fuel sources;

• i.e. Hydrogen cars

Medical therapies to cure diseases;

• i.e Biotechnology

Lower-cost and higher quality health care by applying 21st century information technologies;

• i.e 1/3 of health care dollars are tied-up in administrative paperwork



2121stst Century Innovation Opportunity – Century Innovation Opportunity – the Hydrogen Economy Case Study the Hydrogen Economy Case Study

The potential of a hydrogen economy to address major challenges facing America and the rest of the world is capturing the imagination of consumers, researchers, government and industry.

Why hydrogen?

• Hydrogen fuel cell vehicle is nearly twice as energy efficient as a conventional vehicle and its only emission is water vapor;

• If 1 in 100 cars use hydrogen, 4 million gallons of gas will be saved every day

• Hydrogen can be extracted from various fuels, promoting energy diversity

• Fuel cells are a potential source not only of transportation power, but also of electrical power.


General Motors says Sequel, its latest hydrogen car prototype, can help end gasoline's grip on the industry

Fill 'er up with hydrogen




Innovation ChallengesInnovation Challenges The rest of the world is picking up the pace... Today the forces

of global economic integration and advances in technology are creating a different and more complex challenge.

Sweden, Finland, Israel and South Korea each spend more on R&D as a share of GDP than the United States;

China overtook the United States in 2003 as thh top global recipient of foreign direct investment;

Asia now spends as much on nanotechnology as the United States

Only six of the world’s 25 most competitive IT companies are based in the US; 14 are based in Asia

Corporate R&D dropped nearly $8 billion in 2002, the largest single year decline since the 1950s.



3. The New Shape of Innovation in America3. The New Shape of Innovation in America



The New Shape of InnovationThe New Shape of Innovation

Relationships that once looked adversarial are increasingly evolving into complementary, even symbolic ones.

Some of the most salient new relationships among innovators and in the nature of innovation itself include:

• User and producer-based innovations;

• Manufacturing and services

• Nationalism and globalization

• Security and scientific openness

• Public and private sector innovations



The New Shape of Innovation [cont.]The New Shape of Innovation [cont.] User and producer based innovations

• The world is divided into “producers” and “consumers” with the former in control…or not?

• This has now changed with “User-based innovation”, a term coined by MIT’s Eric von Hippel

• New models of innovation incorporate the customer into the design and development process

• This relationship can help manage risk and significantly mobilize the nations innovation capabilities.



The New Shape of Innovation [cont.]The New Shape of Innovation [cont.]

User and producer based innovations

Photo courtesy of the Economist – “The rise of the creative consumer”Mar 10th 2005



The New Shape of Innovation [cont.]The New Shape of Innovation [cont.]

Examples of user-based innovation:

General Electric’s “LightSpeed VCT” – 3D image of a beating heart

Staple’s “wordlock” – a padlock that uses words instead of numbers

BMW’s “telematics” – combining computing and telecoms for new generation luxury cars. BMW posted a toolkit on their website asking customers their ideas for in-car online services; 15 out of 1000 replies were chosen and prototypes have been developed.

Electronic Arts’ “open source software” – manufacturer of computer games ships programming tools to its customers, posts their modifications online and works their creations into new games.

What’s the connection? Harnessing customer innovation requires new methods



4. The Innovation Ecosystem 4. The Innovation Ecosystem as difined in America as difined in America



The Innovation EcosystemThe Innovation Ecosystem

Innovation is best seen not as a linear or mechanic process, but as an ecosystem, a multi-faceted and continual interaction among many aspects of the economy and society;

Ecosystem must take into consideration:

supply inputs

market demand

influence of external factors, especially the policy environment and common national infrastructure.



The Innovation EcosystemThe Innovation Ecosystem



5. Looking Ahead5. Looking Ahead



Key National PrioritiesKey National Priorities The National Innovation Initiative identified some key national

priorities that while not specific to near-term stimulation of innovation, do underpin America’s ability to innovate. These key priorities include:

• Unfunded Liabilities I.e. Health Care and Social Security

• K-12 Education More emphasis on creating a workforce equipped for creative

thinking and collaborative culture. American students tend to have mediocre performance on international assessment exams.

• A Global Trading System Harmonize global rules on competition policy, international

standards and intellectual property, the fundamentals of protecting innovation.

• 21st Century Infrastructure Transportation and Internet upgrades

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Useful Source of InformationUseful Source of Information InnovateAmerica – National Innovation Initiative Report

December 2004; Council of Competitiveness

Available in CRCi

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Sociedade Portuguesa de Inovação Tuesday, June 21 st, 2005 3,5/3,5 CM Innovation in America