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Sparking Innovationby Ben Doctor
During his 2011 State of the Union address, President Obama called attention to America’s proclivity for innovation: “What we can do, what America does better than anyone, is spark the creativity and imagination of our people.” President Obama praised the visionary leadership of Americans such as Edison and the Wright brothers and of companies such as Google and Facebook. He proclaimed that “in America, innovation doesn’t just change our lives. It’s how we make a living.” Of course, re-sparking a surge in American innovation is easier said than done.
An Incubator for Fresh Ideas
When President Obama chose to highlight corporate innovation, he drew attention to two California-based companies: Google and Facebook. This should come as no surprise to Californians, who have long recognized their state as an incubator for fresh ideas. And within California, few places are as intimately acquainted with innovation as San Diego.
According to the 2010 3rd Quarter CONNECT Innovation Report (CIR), San Diego was among the top innovation economies in California, based on the amount of federal research funds provided by the National Institutes of Health and the National Science Foundation during the first three quarters of 2010. Quoted in the CIR is Kelly Cunningham, economist and senior fellow at the National University System Institute for Policy Research, “[The life sciences] sector holds considerable potential for the nation's economic future, with San Diego continuing to be a prominent leader in this specific category of tech startup.”
A major force behind San Diego’s prominence in the life sciences is its community of more than 80 research institutions. Diverse knowledge structures like those exhibited across San Diego’s research landscape elicit diversity of thought and creative problem solving that invariably yield innovation. The ability to capitalize on the region’s combined knowledge drives its innovation capabilities. As a result, to date, UC San Diego faculty and alumni alone have created more than 300 startup companies.
Government Involvement in Innovation
The CIR says that, in order to sustain such growth in an innovation-driven economy, San Diego must increasingly rely on government involvement, from funding of research and the protection of intellectual property to workforce development and investment incentives.
Vice President Joe Biden recently met with Verizon Communications Chairman Ivan Seidenberg, MasterCard CEO Ajay Banga, Eli Lilly CEO John Leichleiter and Fox Filmed Entertainment Co-Chairman Thomas Rothman, where he proclaimed that the Obama administration “is deeply committed” to economic prosperity through innovation. Biden continued that intellectual property protection is “a matter of economic opportunity and it’s also a matter [of] public safety and national security.” Furthermore, government involvement has become increasingly important in ensuring access to startup capital. America’s growth in innovation-driven industries is fueled by public policies that encourage investment and reward risk.
A 2009 World Economic Forum report concluded that “a world without risk taking is a world without innovation, without entrepreneurship and without growth.” CONNECT CEO Duane Roth commented in the CIR that San Diego-based startups have weathered the 60 percent decrease in venture funding from pre-recession levels largely by securing federal research grants. Consequently, San Diego’s pharmaceutical and biotechnology medical device sector ranked first statewide with 33 new companies formed in the third quarter of 2010. However, strides in intellectual capital and technology can only be made if smart, creative and entrepreneurial people are spurred to undertake such endeavors.
People Drive Innovation
President Obama decreed that “the first step in winning the future is encouraging American innovation.” But the task of systematically inciting innovation is fraught with organizational challenges. As opposed to strategies that forecast clear, unambiguous goals, innovation often arises from incremental capitalization of unexpected opportunities. To take full advantage of such opportunities requires latitude to experiment and to make mistakes.
Quoted in the book “Built to Last,” 3M President William McKnight asserts: “Mistakes will be made [by giving people the freedom and encouragement to act autonomously], but…the mistakes he or she makes are not as serious in the long run as the mistakes management will make if it is dictatorial and undertakes to tell those under its authority exactly how they must do their job. Management that is destructively critical when mistakes are made kills initiative and it's essential that we have many people with initiative if we are to continue to grow.”
Because it is so remarkably difficult to evaluate progress when an employee’s very output is supposed to be novel and unprecedented, failure must be framed as an investment in learning. In his book, “Winning Decisions; Getting it Right the First Time,” Albert Yu, senior vice president at Intel, acknowledged that “failure is just part of the culture of innovation. Accept it and become stronger.”
Thankfully, the vast and diverse research culture in San Diego embodies those very principles. The community can be seen as an organic structure, which is adaptable when challenges and opportunities are ambiguous and demand cross disciplinary knowledge and experience. It’s the collaboration among our diverse institutions that produces an environment primed for commercial application of research.
The concept was recently reinforced by the new Clinical and Translational Research Institute, which was awarded a five-year, $37.2 million grant to serve as the catalyst for the clinical application of medical research conducted across San Diego. The enormous potential of the project stems from the strength of its partners: the UC San Diego Medical Center, the Rady School of Management, the Jacobs School of Engineering and the greater San Diego biotechnology and health sciences community. By demonstrating the working potential of collaboration across its diverse and capable sectors, San Diego can potentially serve as a model for Obama's vision of an innovation-driven future.
Ben Doctor (Rady Full-Time MBA ’12) has a bachelor of science from the University of California, Santa Barbara. He is a Rady Fellow with diverse professional experience ranging from environmental consulting to education. His interests lie at the intersection of entrepreneurship, innovation, leadership and marketing strategy.