Written evidence submitted by C-Tech Innovation
Ltd (TIC 83)
THE INNOVATION
VACUUM : FILLING
THE GAPS
LEFT BY
THE DEMISE
OF THE
RDA'S AND
BUSINESS LINK
UK SME's are in crisis and their capacity for innovation
is on the wane ….
The demise of the Regional Development Agencies is
leaving a vacuum in SME's for the provision of research, innovation
and business support. The landscape of the support that was available
had been simplified by the Business Support Simplification Programme,
to make it easier for businesses to understand and access the
support that was historically available, however today much of
this support is disappearing. Grant for R&D is on hold, KTP
are frozen, support programmes such as Envirowise are now part
of WRAP and delivered via a web portal and it appears that BusinessLink
is also heading in this direction. This has resulted in the disappearance
of much of the one-to-one business support that is so essential
in helping British inventors turn their ideas into products and
jobs.
For the average SME owner-manager looking to "step-up"
and take on the challenge of growing Britain's economy as the
Public Sector shrinks, there are still many questions left unanswered
and much more detail needs to be provided. For these companies,
who had grown steadily by adopting a pragmatic approach to business
support from the Public Sector, the proposed centralised Business
Link web / helpline format seems a pale imitation of the
kind of support these more established companies had previously
benefited from. So who will provide the more intensive support
these companies need and where will the funding come from?
David Willetts (Minister of State for Universities
and Science) recently announced
that the Technology Strategy Board would be placed at the centre
of future developments in innovation, both for universities and
business. It is clear that the government intends to establish
a series of national Technology and Innovation Centres (TIC's)
based on the recommendations of the Hauser / Dyson reviews, which
are similar to the German Fraunhofer Institutes, and that these
would be funded by the Technology Strategy Board (TSB). These
seem to be a logical focus for the development and strengthening
of the UK's lead in certain specific key technology areas. The
centres also seem to be a natural conduit for the University sector
to transfer knowledge and other intellectual property to industry,
ably assisted in this by the TSB's own Knowledge Transfer Networks.
Indeed the University sector does have an important
SME business support role to play at local level also. But this
needs to be based on the proven strengths of the Universities
such as the provision of training and the management of business
incubators and an increased ability to "talk the language
of business".
However, if the TIC's do follow the Fraunhofer model
in having a physical geographical location and a single sector
specific remit, eg ICT, Advanced Materials, Environmental Technology,
these centres could end up adding value to only their local SME's
and companies with technology needs beyond the remit of their
regional TIC's would not be able to access such badly needed support.
The BusinessLink model has proven that SME's respond better to
business support delivered within their business and that remote
"hands-off" support is a poor "second best".
So how will the Innovation Supply Chain work
from the high level national strategy of the TSB and TIC's, down
to the localised needs of the UK's SME's?
A potential solution is through Local Enterprise
Partnerships (LEP's) however these will be constrained in their
ability to do this as it has already been stated that no central
funding is available to cover the costs of running these entities.
A review of most LEP bids shows that although some have local
SME business support plans, many intend to focus on larger infrastructure
projects, such as Transport, Tourism and Retail as a means of
stimulating growth at the Macro level and will therefore be bidding
into the £1.4 billion Regional Growth Fund (RGF) to support
such projects.
If not the LEP's, then who else will champion the
cause of SME innovation at a local level?
The answer to the dilemma of how to provide more
intensive business support to SME's in the current cash-strapped
climate, lies in the role of the, as yet little known, Regional
Growth Hubs (RGH's) and the activities of private sector knowledge
transfer specialists such as independent research and tech-transfer
organisations (RTO's) and consultancies. With proper business
planning RGH's can fill the SME business support vacuum left in
the regions, by providing a vital co-ordinating function between
LEP's, the TSB and it's Knowledge Transfer Networks (KTN's) and
the University Sector. These RGH's could facilitate the kind of
intensive business support, such as 1:1 mentoring and coaching
of SME owner-managers as well as embedding an understanding of
the requirement to secure IP and develop processes that shorten
the "time to market for new projects. This approach has been
successfully proven through a number of programmes run by the
former RDA's. The RGH's as part of this process could also provide
a vital role in catalysing the outcomes University research and
"know how" into new product for both "spin-outs"
and SME's. In a sense not just helping Universities to reach out,
but also reaching in to provide vital 'market' knowledge
to Universities on research, skills and training needs.
Clearly this co-ordinating role requires an intimate
knowledge of all of the key players and influencers within the
innovation landscape. In many cases independent Research and Technology
Organisations (RTO's) and consultancies have a very successful
track record in having delivered such activity. So the historical
evidence proves that they can play a vital role in the future
delivery of high level business support to stimulate the innovative
capacity of UK PLC.
There are a number of potential funding streams for
RGH's to draw upon to support their activity, e.g. the TSB, the
RGF and pots of as yet unused European Regional Development Funds
(ERDF), which lie within the regions. As yet there is no clear
message from government which of these sources is most relevant
to RGF's, so it is vital that decisions are made soon to clarify
the position.
The inevitable changes that have been forced upon
UK business by the recession gives us the opportunity to take
the lesson learnt and develop more effective mechanisms to provide
a superior innovation and business support policy and strategy
that is fit for purpose.
Immediate action is required to support SMEs and
the business support community, universities, research and technology
organisations, including other players in the UK knowledge base
are ready to rise to this challenge. What is lacking is a clear
framework so that they can work together to accelerate the recovery
of the UK from the recession.
Ged Barlow
Managing Director
C-Tech Innovation Ltd
9 December 2010
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